B-202850.OM, JUL 16, 1981

B-202850.OM: Jul 16, 1981

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DIGEST: WHERE EVIDENCE OF RECORD FAILS TO SHOW THAT REQUIRED LABOR STANDARDS PROVISIONS WERE INCLUDED IN SUBCONTRACT OR THAT SUBCONTRACTOR EXPRESSLY AGREED TO ABIDE BY LABOR STANDARDS PROVISIONS OF PRIME CONTRACT. SUBCONTRACTOR CANNOT BE FOUND TO HAVE WILLFULLY DISREGARDED OBLIGATIONS UNDER DAVIS-BACON ACT SO AS TO WARRANT DEBARMENT SINCE OBLIGATIONS OF DAVIS-BACON ACT COME INTO BEING BY VIRTUE OF CONTRACTUAL PROVISIONS AND ARE NOT IMPOSED BY OPERATION OF STATUTE. THERE IS NO EVIDENCE THAT THE SUBCONTRACT AWARDED OSBORN BY JERRY NAEGER. PROVISIONS AND THE APPLICABLE WAGE DETERMINATION WERE INCLUDED. INSTEAD THE AGREEMENT WITH THE PRIME CONTRACTOR WAS ORAL AND OSBORN WAS NEVER INFORMED OF THE SIGNIFICANCE OF THE CERTIFIED PAYROLLS.

B-202850.OM, JUL 16, 1981

DIGEST: WHERE EVIDENCE OF RECORD FAILS TO SHOW THAT REQUIRED LABOR STANDARDS PROVISIONS WERE INCLUDED IN SUBCONTRACT OR THAT SUBCONTRACTOR EXPRESSLY AGREED TO ABIDE BY LABOR STANDARDS PROVISIONS OF PRIME CONTRACT, SUBCONTRACTOR CANNOT BE FOUND TO HAVE WILLFULLY DISREGARDED OBLIGATIONS UNDER DAVIS-BACON ACT SO AS TO WARRANT DEBARMENT SINCE OBLIGATIONS OF DAVIS-BACON ACT COME INTO BEING BY VIRTUE OF CONTRACTUAL PROVISIONS AND ARE NOT IMPOSED BY OPERATION OF STATUTE.

ASSOCIATE DIRECTOR, AFMD-CLAIMS GROUP:

INDORSEMENT

RETURNED. THE EVIDENCE INDICATES THAT THE SUBCONTRACTOR, R. C. OSBORN AND SON, INC., (OSBORN), DID PAY THE EMPLOYEES IN QUESTION LESS THAN THE WAGE RATES PRESCRIBED BY THE WAGE DETERMINATION. THE SUBCONTRACTOR HAS MADE RESTITUTION TO THE UNDERPAID EMPLOYEES. HOWEVER, THERE IS NO EVIDENCE THAT THE SUBCONTRACT AWARDED OSBORN BY JERRY NAEGER, INC., THE PRIME CONTRACTOR, CONTAINED THE LABOR STANDARDS PROVISIONS AS REQUIRED BY 29 C.F.R. SEC. 5.5(A)(B) (1980), NOR DOES THE EVIDENCE ESTABLISH THAT OSBORN EXPRESSLY AGREED TO THE LABOR STANDARDS PROVISIONS OF THE PRIME CONTRACT. ON THE CONTRARY, THE RECORD INDICATES THAT OSBORN NEVER ENTERED INTO A WRITTEN AGREEMENT WITH THE PRIME CONTRACTOR IN WHICH THE DAVIS-BACON ACT, 40 U.S.C. SEC. 276A (1976), PROVISIONS AND THE APPLICABLE WAGE DETERMINATION WERE INCLUDED, BUT INSTEAD THE AGREEMENT WITH THE PRIME CONTRACTOR WAS ORAL AND OSBORN WAS NEVER INFORMED OF THE SIGNIFICANCE OF THE CERTIFIED PAYROLLS. OBLIGATIONS UNDER THE DAVIS-BACON ACT COME INTO BEING ONLY BY VIRTUE OF CONTRACTUAL PROVISIONS AND ARE NOT DIRECTLY IMPOSED BY STATUTE. B-201220-O.M., APRIL 23, 1981, AND CASES CITED THEREIN. IN THE ABSENCE OF EVIDENCE THAT THERE WERE LABOR STANDARDS PROVISIONS IN THE SUBCONTRACT, WE MUST CONCLUDE THAT OSBORN HAD NO BINDING OBLIGATION TO EMPLOYEES UNDER THE DAVIS-BACON ACT. SEE B-195240-O.M., SEPTEMBER 7, 1979. THIS BEING THE CASE, OSBORN CANNOT BE FOUND TO HAVE WILLFULLY DISREGARDED ITS OBLIGATIONS UNDER THE ACT.

THE EVIDENCE DOES NOT INDICATE THAT THE PRIME CONTRACTOR WILLFULLY PARTICIPATED IN OR CONTRIBUTED TO THE DISREGARD OF OBLIGATIONS TO EMPLOYEES WITHIN THE INTENT OF THE DAVIS-BACON ACT SO AS TO PROVIDE GROUNDS FOR THE IMPOSITION OF DEBARMENT SANCTIONS AGAINST THE PRIME CONTRACTOR. B-200301-O.M., B-200302-O.M., OCTOBER 17, 1980.

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