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DEBARMENT IS NOT APPROPRIATE. DISTRIBUTION OF FUNDS TO THE EMPLOYEES INVOLVED IS ORDERED. WE CONCUR WITH DOL THAT DEBARMENT IS NOT APPROPRIATE. THE INVESTIGATION WAS INITIATED AS A RESULT OF A REVIEW OF THE CONTRACTORS' WEEKLY PAYROLL REPORTS. THE VIOLATIONS WHICH WERE DISCLOSED ARE CONSIDERED TO HAVE RESULTED FROM THE LACK OF DUE CARE ON THE PART OF THE OFFENDING CONTRACTORS RATHER THAN ATTEMPTS TO WILLFULLY VIOLATE THE MINIMUM WAGE REQUIREMENTS OF THE CONTRACT. THE DAVIS-BACON ACT PROVIDES THAT THE COMPTROLLER GENERAL IS TO DEBAR PERSONS OR FIRMS WHOM HE HAS FOUND TO HAVE DISREGARDED THEIR OBLIGATIONS TO EMPLOYEES UNDER SEC. 3(A) OF THE DAVIS-BACON ACT. THE GENERAL ACCOUNTING OFFICE IS RESPONSIBLE.

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B-217812, AUG 13, 1985, OFFICE OF GENERAL COUNSEL

BIDDERS - DEBARMENT - LABOR STIPULATION VIOLATIONS - DAVIS-BACON ACT DEBARMENT UNWARRANTED CONTRACTORS' DEFICIENCIES IN KEEPING REQUIRED RECORDS UNDER THE DAVIS- BACON ACT AND THE CONTRACT WORK HOURS AND SAFETY STANDARDS ACT RESULTED FROM LACK OF DUE CARE RATHER THAN ATTEMPTS TO WILLFULLY VIOLATE THE MINIMUM WAGE REQUIREMENTS OF THE CONTRACT. THUS, DEBARMENT IS NOT APPROPRIATE, BUT DISTRIBUTION OF FUNDS TO THE EMPLOYEES INVOLVED IS ORDERED.

MR. SYLVESTER L. GREEN: DIRECTOR, DIVISION OF CONTRACT STANDARDS OPERATIONS WAGE AND HOUR DIVISION U. S. DEPARTMENT OF LABOR ROOM S3518 200 CONSTITUTION AVENUE, N.W. WASHINGTON, D.C. 20210

SUBJECT: ROUSE CONSTRUCTION, INC. - PRIME CONTRACTOR JACKSON, MISSISSIPPI VARIOUS SUBCONTRACTORS CONTRACT NO: DACW38-78-C-0183 YOUR FILE NO: MISS-84 -137

THE DEPARTMENT OF LABOR (DOL) HAS TRANSMITTED A REPORT TO OUR OFFICE CONCERNING ALLEGED VIOLATIONS OF THE DAVIS-BACON ACT, 40 U.S.C. SECS. 276A TO 276A-5 (1982) AND THE CONTRACT WORK HOURS AND SAFETY STANDARDS ACT (CWHSSA), 40 U.S.C. SECS. 327-332 (1982), BY ROUSE CONSTRUCTION, INC., THE PRIME CONTRACTOR, AND VARIOUS SUBCONTRACTORS ON CONTRACT NO. DACW38-78-C- 0183. DOL HAS NOT RECOMMENDED DEBARMENT AND REQUESTS THAT THE FUNDS ON DEPOSIT WITH OUR OFFICE BE DISTRIBUTED TO THE WORKERS INVOLVED. FOR THE FOLLOWING REASONS, WE CONCUR WITH DOL THAT DEBARMENT IS NOT APPROPRIATE, AND ORDER THE DISTRIBUTION OF THE FUNDS ON DEPOSIT WITH OUR OFFICE.

ACCORDING TO THE DEPARTMENT OF THE ARMY'S REPORT WHICH DOL TRANSMITTED TO US, THE CONTRACTORS INVOLVED FAILED TO PAY THEIR EMPLOYEES THE REQUIRED PREVAILING WAGE RATES AND THE PROPER OVERTIME COMPENSATION. THE INVESTIGATION WAS INITIATED AS A RESULT OF A REVIEW OF THE CONTRACTORS' WEEKLY PAYROLL REPORTS. THE VIOLATIONS WHICH WERE DISCLOSED ARE CONSIDERED TO HAVE RESULTED FROM THE LACK OF DUE CARE ON THE PART OF THE OFFENDING CONTRACTORS RATHER THAN ATTEMPTS TO WILLFULLY VIOLATE THE MINIMUM WAGE REQUIREMENTS OF THE CONTRACT. THE CONTRACTING OFFICER RECOMMENDED THAT THE ASSESSMENT OF THE CWHSSA LIQUIDATED DAMAGES BE AFFIRMED AND THAT THE FILE BE CLOSED WITHOUT ANY FURTHER ADMINISTRATIVE SANCTIONS BEING IMPOSED AGAINST THE PRIME CONTRACTOR OR OFFENDING SUBCONTRACTORS.

THE DAVIS-BACON ACT PROVIDES THAT THE COMPTROLLER GENERAL IS TO DEBAR PERSONS OR FIRMS WHOM HE HAS FOUND TO HAVE DISREGARDED THEIR OBLIGATIONS TO EMPLOYEES UNDER SEC. 3(A) OF THE DAVIS-BACON ACT, 40 U.S.C. SEC. 276A- 2(A) (1982). THUS, THE GENERAL ACCOUNTING OFFICE IS RESPONSIBLE, IN ALL INSTANCES WHERE COMPLIANCE WITH PROVISIONS OF THE DAVIS-BACON ACT HAS BEEN QUESTIONED, FOR DETERMINING WHETHER OR NOT "VIOLATIONS" OCCURRED IN A SENSE THAT REQUIRES IMPOSITION OF THE STATUTORY INELIGIBILITY SANCTION (DEBARMENT). ALSO, IT IS RESPONSIBLE, WHEN FUNDS HAVE BEEN WITHHELD FROM A CONTRACTOR UNDER SEC. 1(A) OF THE DAVIS-BACON ACT, 40 U.S.C. SEC. 276AA) (1982) TO COVER WAGE UNDERPAYMENTS, FOR PAYING AGGRIEVED EMPLOYEES AMOUNTS TO WHICH THEY MAY BE ENTITLED. A THIRD RESPONSIBILITY EXISTS, IN INSTANCES WHERE WITHHOLDING ACTION HAS BEEN TAKEN, TO SETTLE CLAIMS BY CONTRACTORS OR OTHER INTERESTED PARTIES BASED UPON THE AMOUNTS WITHHELD. B-3368, MARCH 19, 1957, AND SEE SWEET HOME STONE COMPANY, ET AL., B-185020, DECEMBER 26, 1976, DISTINGUISHED ON OTHER GROUNDS BY B-185020, DECEMBER 28, 1978; 55 COMP.GEN. 744 (1976); 46 COMP.GEN. 178 (1966). B-3368, MARCH 19, 1957, WE DISTINGUISHED BETWEEN "TECHNICAL VIOLATIONS" WHICH RESULT FROM INADVERTENCE OR LEGITIMATE DISAGREEMENT CONCERNING CLASSIFICATION, AND "SUBSTANTIAL VIOLATIONS" WHICH ARE INTENTIONAL AS DEMONSTRATED BY BAD FAITH OR GROSS CARELESSNESS IN OBSERVING THE OBLIGATIONS TO EMPLOYEES WITH RESPECT TO THE MINIMUM WAGE PROVISIONS OF THE DAVIS-BACON ACT.

BASED ON OUR INDEPENDENT REVIEW OF THE RECORD IN THIS MATTER, WE CONCLUDE THAT THE VIOLATIONS WHICH WERE DISCLOSED RESULTED FROM LACK OF DUE CARE IN KEEPING RECORDS ON THE PART OF THE CONTRACTORS RATHER THAN ATTEMPTS TO WILLFULLY VIOLATE THE MINIMUM WAGE REQUIREMENTS OF THE CONTRACT. THUS, DEBARMENT OF THE CONTRACTORS INVOLVED IN THIS CASE IS NOT APPROPRIATE. B-3368, MARCH 19, 1957.

IN REGARD TO PAYMENT OF THE EMPLOYEES, WE NOTE THAT THE CONTRACTORS HAVE ALREADY MADE RESTITUTION TO THE EMPLOYEES WHOM THEY COULD LOCATE, AND THE REMAINDER OF THESE FUNDS HAS BEEN DEPOSITED WITH OUR OFFICE. ACCORDINGLY, WE ORDER THAT THESE FUNDS BE DISTRIBUTED TO THE EMPLOYEES INVOLVED.

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