Disputes concerning the payment of
prevailing wage rates and proper
classification by:
PEABODY CONSTRUCTION COMPANY,
General Contractor,
and
HOVESP TAKESSIAN d/b/a/ JOSEPH'S PAINTING
and d/b/a/ SEVAN CONTRACTING, INC.
Subcontractor,
and
Proposed debarment for labor standards
violations by:
HOVESP TAKESSIAN d/b/a/ JOSEPH'S PAINTING
and d/b/a/ SEVAN CONTRACTING, INC.,
With respect to laborers and mechanics
employed by the contractor under
Fall Rive Housing Authority/HUD
Contract No. MA-6-2 for Modernization
of the Harbor Terrace Apartments in Fall
River, MA
This matter arises from an Order of Reference filed by the Administrator of the Wage and Hour Division pursuant to the Davis Bacon Related Acts, and the applicable regulations issued thereunder at 29 C.F.R. Part 5, sections 5.11(b) and 5.12. The Order of Reference asserts that back wages are owed to laborers and mechanics employed by Hovsep Takessian d/b/a Joseph's Painting and d/b/a Sevan Contracting, Inc. ("Subcontractor") as a result of prevailing wage violations.
The Department of Labor requested by Motion dated July 3, 2003, that this Office issue an Order To Show Cause. The Department's motion states that neither Peabody Construction, Inc. ("General Contractor") nor the Subcontractor submitted responsive status reports in response to this Office's Order dated July 27, 1998, requiring the submission of status reports. The Department of Labor's status report, filed on August 26, 1998, states that "[d]ebarment will not be pursued against the subcontractor because the principal has deceased, and the business is no longer operating. Upon information and belief, an amount of $56,384.62 in underpayments continues to be withheld by the contracting agency, the Fall River Housing Authority under contract no. MA 6-2."
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The General Contractor filed a statement with this Office on July 29, 2003, stating therein that "Peabody Construction Co., Inc. does not object to the release and distribution to the employees of funds held previously by the Fall River Housing Authority and H.U.D. in connection with the claims that are the subject-matter of this action." The Subcontractor also filed a statement on July 29, 2003. However, the Subcontractor stated that it does object to the disbursement of funds by H.U.D. in this matter.
A telephone conference was held in response to this objection on August 5, 2003. At that time, counsel for the Subcontractor was afforded a period of time to submit to this Office a supplemental statement regarding whether he has a basis for objecting to the disbursement of withheld funds. On August 15, 2003, counsel for the Subcontractor filed a letter with this Office, and reasserted his objection to the disbursement of funds. However, the August 15, 2003 letter does not state a substantive basis for the objection.
This Office issued an Order to Show Cause on September 23, 2003, which made the following findings:
1. Neither the General Contractor nor the Subcontractor filed a status report responsive to the July 27, 1998 Order Requesting Status Reports;
2. The General Contractor no longer opposes disbursement of the funds withheld in this matter;
3. The Subcontractor's principal is deceased, and the business is no longer operating; and
4. The Department of Labor is no longer seeking disbarment against the Subcontractor.
Order to Show Cause, at 2-3 (September 23, 2003). Furthermore, it was ordered that any party opposing dismissal of the hearing request filed in this matter must show cause why this office should not dismiss that hearing request and make a final determination that any funds withheld on Contract MA 6-2 are owed to employees for prevailing wage determinations.
In response to the Order to Show Cause, counsel for the Subcontractor filed a Statement Opposing Dismissal of Hearing Request on October 23, 2003. Therein, he asserted that certain documents had not been made available to the Subcontractor. This Office issued a subsequent Order on November 21, 2003, affording the Subcontractor additional time to respond to the Order to Show Cause, and attached the missing pleadings identified by the Subcontractor.
On December 9, 2003, the Subcontractor filed a Response Order to Show Cause/Motion to Dismiss. The Subcontractor stated that it did not receive the July 27, 1998 Order Requesting the Submission of Status Reports. Therefore, the Subcontractor requests that "the order to show cause be denied and this Motion to Dismiss be allowed as the Department of Labor has not followed its own rules and regulations." The Subcontractor argues that the hearing in this matter did not take place within sixty days from the date on which the Order of Reference was filed pursuant to the applicable regulations. Also, the Subcontractor states that it continues to oppose the disbursement of funds.
The Subcontractor's statement that it did not receive the July 27, 1998 Order Requesting the Submission of Status Reports is accepted in good faith. Therefore the Order to Show Cause has been satisfied with regard to this issue, and an order dismissing this matter shall not be issued on the grounds that the Subcontractor was unresponsive to the aforementioned Order Requesting the Submission of Status Reports. However, the Subcontractor has now made its own motion for the dismissal of this matter based on delay of the hearing.
The regulation cited by Subcontractor in its Response to the Order to Show Cause, stating that the hearing must occur within sixty days of the filing of the Order of Reference, applies to cases that arise under the Migrant and Seasonal Agricultural Worker Protection Act. See Subcontractor's Response Order to Show Cause/Motion to Dismiss, at 4, citing 29 C.F.R. §§ 500.201, 500.212, 500.221, and 500.224. Those regulations are not applicable here, and the Subcontractor's Motion to Dismiss on that basis is denied. Furthermore, there has been no evidence that this Office did not follow the provisions applicable to cases arising under the Davis Bacon Related Acts, at 29 C.F.R. Part 5 (specifically 29 C.F.R. §§ 5.11(b) and 5.12). Any delay in the scheduling of the hearing in this matter was not due to bad faith by either party. Rather, the record shows that this matter was not initially scheduled for a hearing because this Office had been notified by the parties that they were attempting to settle. This Office subsequently issued the Order Requesting Submission of Status Reports on July 27, 1998, because this Office never received any subsequent settlement notice, and it needed to determine whether a hearing should be scheduled. In response to that Order, the Department of Labor stated that it no longer sought debarment due to the passing of the Subcontractor's principal and the fact that the Subcontractor was no longer operating. This case was then inadvertently placed with the files that have been marked closed. The motion filed by the Department of Labor on July 3, 2003, brought this matter to the attention of the undersigned.
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Therefore, it has been determined that in response to the September 23, 2003 Order to Show Cause there has been no evidence or argument presented by either party to oppose the following findings:
1. The General Contractor no longer opposes disbursement of the funds withheld in this matter;
2. The Subcontractor's principal is deceased, and the business is no longer operating; and
3. The Department of Labor is no longer seeking disbarment against the Subcontractor.
Furthermore, no responsive argument or probative evidence has been submitted by counsel for the Subcontractor, or anyone else, opposing the disbursement of funds that were withheld from the General Contractor's contract. On these grounds, a dismissal of the hearing request in this matter is appropriate, as there are no outstanding issues to be decided. Accordingly,
ORDER
IT IS HEREBY ORDERED that the hearing request in this matter shall be DISMISSED. Any funds withheld from the Fall River Housing Authority/HUD Contract No. MA-6-2 shall be disbursed by the Administrator to the employees to whom the funds are owed. This matter shall be marked CLOSED.
Thomas M. Burke
Associate Chief Administrative Law Judge
NOTICE OF APPEAL: Any party dissatisfied with this decision may appeal it within forty (40) days from the date of this decision by filing a Petition for Review with the Administrative Review Board, U.S. Department of Labor, Room S-4309, Frances Perkins Building, 200 Constitution Avenue, NW, Washington, DC 20210, under 29 C.F.R. §§ 6.34 and 29 C.F.R. Part 7. Such filing with have the effect of making this decision inoperative unless and until the Administrative Review Board either declines to review the decision or issues an order affirming
