B-170882, DEC. 15, 1970

B-170882, DEC. 15, 1970

DEBARRED BIDDER LETTER INFORMING THE DUNDALK PAINTING COMPANY, INC., OF THE FINDING THAT, FOR VIOLATIONS OF THE DAVIS-BACON ACT, 40 U.S.C. 276(A) IN PERFORMANCE OF A CONTRACT FOR PAINTING HOUSING UNITS AT THE DOVER AIR FORCE BASE, DELAWARE, THEY WILL BE PLACED ON THE DEBARRED LIST.

TO THE DUNDALK PAINTING CO., INC.:

ENCLOSED IS A COPY OF OUR FINDING OF TODAY THAT THE DUNDALK PAINTING CO., INC., MR. JAMES C. KIRHAGIS, ITS PRESIDENT AND TREASURER, AND MRS. MARY L. KIRHAGIS, ITS VICE PRESIDENT AND SECRETARY, HAVE DISREGARDED OBLIGATIONS TO EMPLOYEES WITHIN THE MEANING OF THE DAVIS-BACON ACT, 49 STAT. 101, 40 U.S.C. 276(A), IN THE PERFORMANCE OF DEPARTMENT OF THE AIR FORCE CONTRACT NO. AF07(603)-3249, WHICH APPEARS TO HAVE BEEN AWARDED ON JANUARY 12, 1965, FOR THE REPAINTING OF INTERIOR FAMILY HOUSING UNITS AT THE DOVER AIR FORCE BASE, DELAWARE.

PURSUANT TO THE PROVISIONS OF SECTION 3(A) OF THE ACT, THESE NAMES WILL BE INCLUDED IN THE NEXT PUBLICATION OF THE DEBARRED LIST, AND NO GOVERNMENT CONTRACT WILL BE AWARDED TO THEM OR TO ANY FIRM, CORPORATION, PARTNERSHIP, OR ASSOCIATION IN WHICH SUCH PERSON OR FIRM HAS AN INTEREST UNTIL THREE YEARS HAVE ELAPSED FROM THE DATE OF PUBLICATION.

FINDING

IN THE MATTER OF THE DUNDALK PAINTING CO., INC., MR. JAMES C. KIRHAGIS, ITS PRESIDENT AND TREASURER, AND MRS. MARY L. KIRHAGIS, ITS VICE PRESIDENT AND SECRETARY.

SECTION 1(A) OF THE DAVIS-BACON ACT OF AUGUST 30, 1935, 49 STAT. 1011, 40 U.S.C. 276A, PROVIDES IN PART THAT --

"THE ADVERTISED SPECIFICATIONS FOR EVERY CONTRACT IN EXCESS OF $2,000, TO WHICH THE UNITED STATES *** IS A PARTY, FOR CONSTRUCTION, ALTERATION, AND/OR REPAIR, INCLUDING PAINTING AND DECORATING, OR PUBLIC BUILDINGS OR PUBLIC WORKS OF THE UNITED STATES *** AND WHICH REQUIRES OR INVOLVES THE EMPLOYMENT OF MECHANICS AND/OR LABORERS SHALL CONTAIN A PROVISION STATING THE MINIMUM WAGES TO BE PAID VARIOUS CLASSES OF LABORERS AND MECHANICS *** AND EVERY CONTRACT BASED UPON THESE SPECIFICATIONS SHALL CONTAIN A STIPULATION THAT THE CONTRACTOR OR HIS SUBCONTRACTOR SHALL PAY ALL MECHANICS AND LABORERS EMPLOYED DIRECTLY UPON THE SITE OF THE WORK, UNCONDITIONALLY AND NOT LESS OFTEN THAN ONCE A WEEK AND WITHOUT SUBSEQUENT DEDUCTION OR REBATE ON ANY ACCOUNT, THE FULL AMOUNTS ACCRUED AT TIME OF PAYMENT, COMPUTED AT WAGE RATES NOT LESS THAN THOSE STATED IN THE ADVERTISED SPECIFICATIONS, REGARDLESS OF ANY CONTRACTUAL RELATIONSHIP WHICH MAY BE ALLEGED TO EXIST BETWEEN THE CONTRACTOR OR SUBCONTRACTOR AND SUCH LABORERS AND MECHANICS *** ." SECTION 3(A) OF THE ACT PROVIDES THAT

" *** THE COMPTROLLER GENERAL OF THE UNITED STATES IS FURTHER AUTHORIZED AND IS DIRECTED TO DISTRIBUTE A LIST TO ALL DEPARTMENTS OF THE GOVERNMENT GIVING THE NAMES OF PERSONS OR FIRMS WHOM HE HAS FOUND TO HAVE DISREGARDED THEIR OBLIGATIONS TO EMPLOYEES AND SUBCONTRACTORS. NO CONTRACT SHALL BE AWARDED TO THE PERSONS OR FIRMS APPEARING ON THIS LIST OR TO ANY FIRM, CORPORATION, PARTNERSHIP, OR ASSOCIATION IN WHICH SUCH PERSONS OR FIRMS HAVE AN INTEREST UNTIL THREE YEARS ELAPSED FROM THE DATE OF PUBLICATION OF THE LIST CONTAINING THE NAMES OF SUCH PERSONS OR FIRMS."

CONTRACT NO. AF07(603)-3249, IN EXCESS OF $2,000 FOR THE REPAINTING OF INTERIOR FAMILY HOUSING UNITS AT THE DOVER AIR FORCE BASE WAS APPARENTLY ENTERED INTO ON JANUARY 12, 1965, BY THE DEPARTMENT OF THE AIR FORCE WITH THE DUNDALK PAINTING CO., INC., BALTIMORE, MARYLAND.

THE CONTRACT CONTAINED THE STIPULATIONS AND REPRESENTATIONS REQUIRED BY SECTION 1(A) OF THE DAVIS-BACON ACT. INVESTIGATIONS CONDUCTED BY THE DEPARTMENT OF THE AIR FORCE DISCLOSED THAT THE CONTRACTOR HAVING FULL KNOWLEDGE OF HIS STATUTORY AND CONTRACTUAL RESPONSIBILITIES DID NEVERTHELESS DISREGARD THESE OBLIGATIONS AS EVIDENCED BY THE DELIBERATE PAYMENT OF WAGES AT SUBMINIMUM RATES TO LABORERS AND MECHANICS EMPLOYED BY HIM ON THE SUBJECT PROJECT. THE INVESTIGATION WAS UNDERTAKEN BY THE DEPARTMENT OF THE AIR FORCE AS THE RESULT OF COMPLAINTS MADE TO THE CONTRACTING OFFICER THAT THE CONTRACTOR WAS NOT PAYING STRAIGHT TIME WAGES AT THE PROPER RATES, AND IN SOME INSTANCES AFTER PAYING PROPER RATES WAS REQUIRING SUBSEQUENT REBATES NOT PERMITTED UNDER DEPARTMENT REGULATIONS. IT WAS CONCLUDED THAT THE COMPLAINTS WERE SUBSTANTIATED AND THAT ADDITIONAL VIOLATIONS HAD OCCURRED. WHILE THE CERTIFIED PAYROLLS SUBMITTED BY THE CONTRACTOR PURPORTED TO SHOW COMPLIANCE WITH THE LABOR STANDARDS PROVISIONS, THE INVESTIGATIONS REVEALED THAT CERTAIN EMPLOYEES WERE CLASSIFIED AND PAID AT BRUSH PAINTERS RATES WHILE ACTUALLY PERFORMING WORK AS ROLLER PAINTERS, A CLASSIFICATION REQUIRING A HIGHER RATE, OR WERE CLASSIFIED AND PAID AT LABORER RATES WHILE PERFORMING THE WORK AND DUTIES OF PAINTERS. THE DEPARTMENT DETERMINED THAT SIX EMPLOYEES WERE DUE WAGE ADJUSTMENTS TOTALING $1,573.24 UNDER THE PROVISIONS OF THE DAVIS-BACON ACT.

BY REGISTERED LETTER DATED OCTOBER 23, 1970, THE GENERAL ACCOUNTING OFFICE NOTIFIED THE CONTRACTOR IN DETAIL OF THE NATURE AND EXTENT OF THE LABOR STANDARDS VIOLATIONS FOUND BY THE CONTRACTING AGENCY, AND OFFERED HIM THE OPPORTUNITY TO REFUTE THE FINDINGS, BUT NO ANSWER WAS RECEIVED THERETO.

IT IS CLEAR, PARTICULARLY IN THE LIGHT OF THE MISCLASSIFICATION OF EMPLOYEES ON THE CERTIFIED PAYROLLS, THAT GOOD FAITH WAS NOT SHOWN IN COMPLYING WITH THE ACT AND CONTRACTUAL PROVISIONS. ONLY THROUGH INVESTIGATION AND DETECTION OF THE MISLEADING INFORMATION FURNISHED IN THE PAYROLL REPORTS WAS IT POSSIBLE FOR THE GOVERNMENT TO ADOPT MEASURES PROTECTING THE EMPLOYEES INVOLVED AND ENSURING COMPLIANCE.

WE THEREFORE, FIND THAT THE DUNDALK PAINTING CO., INC., AND ITS PRESIDENT -TREASURER, JAMES C. KIRHAGIS AND ITS VICE-PRESIDENT SECRETARY, MARY L. KIRHAGIS, HAVE DISREGARDED "OBLIGATIONS TO EMPLOYEES" WITHIN THE MEANING OF THE DAVIS-BACON ACT. ACCORDINGLY, THESE NAMES WILL BE INCLUDED ON A LIST FOR DISTRIBUTION, AND NO CONTRACT SHALL BE AWARDED TO THEM OR ANY FIRM, CORPORATION, PARTNERSHIP, OR ASSOCIATION IN WHICH THEY HAVE AN INTEREST UNTIL THREE YEARS HAVE ELAPSED FROM THE DATE OF PUBLICATION OF SUCH LIST.