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<![CDATA[
CCASE:
Lear Siegler
DDATE:
19851218
TTEXT:
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[1] THE UNDER SECRETARY OF LABOR
WASHINGTON, D.C.
20210
In the Matter of
Lear Siegler, Inc.
Management Services Case No. 85-SCA-WD-1
Division
DECISION OF THE UNDER SECRETARY
This matter is before me pursuant to the McNamara-O'Hara
Service Contract Act of 1965, as amended (SCA), 41 U.S.C. [secs]
351-358 (1982), and the rules and regulations thereunder, 29 C.F.R.
[sec] 4.55 and Part 8 (1985). /FN1/
Petitioner Lear Siegler, Inc., has requested a review of the
conformance of wage rates for dispatchers under contract
F02600-83-C-0029. This contract is for instrument flight simulator
operations at Williams Air Force Base, Arizona.
When Lear Siegler was awarded the contract in 1983, the Wage
Determination issued by the Labor Department's Wage and Hour
Division did not include a wage rate for the dispatcher
classification. A determination of the appropriate wage rate to be
paid for this classification was made in accordance with the
procedures contained in 29 C.F.R. [sec] 4.6. Petitioner proposed
that a conformed rate of $4.00 per hour be paid to [1]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN1/ Section 8.0 of 29 C.F.R. (1985) provides that the Secretary's
designee shall perform the functions of the Board of Service
Contract Appeals during the interim period prior to the appointment
of a duly constituted Board. On February 24, 1984, the Secretary
assigned this responsibility to the Under Secretary. [1]
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[2] dispatchers. The contracting agency, the United States
Department of the Air Force, disagreed and recommended that $5.29
per hour be adopted as the appropriate rate. This was the rate
paid to dispatchers by the previous contractor. In the absence of
an agreement by the parties, the issue was submitted to the
Department of Labor, Wage and Hour Division, for resolution. The
Wage and Hour Division determined that the proper rate was $5.29
and the Wage and Hour Administrator affirmed this determination
when Petitioner requested reconsideration and review.
Petitioner contends that the Wage and Hour Division's
determination was based on the conformed rate in the previous
contract by the predecessor contractor. Although the Service
Contract Act requires a successor contractor to pay no less than
the rates paid by the previous contractor where such contractor had
a collective bargaining agreement with its employees, Siegler
contends that it is not bound by this requirement since there was
no collective bargaining agreement involved. I agree that
Petitioner is not obligated to pay the wage rates of the
predecessor contractor per se.
Petitioner further contends that its proposed wage rate of
$4.00 per hour for the dispatcher classification constitutes a more
reasonable relationship to Wage Determination No. 80-560 (Rev. 3)
than does the $5.29 determined by the Department. [2]
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[3] Guidance on this issue is provided in 4.6 of the regulations as
follows:
The process of establishing wage and fringe benefit rates
that bear a reasonable relationship to those listed in a
wage determination cannot be reduced to any single
formula. The approach used may vary from wage
determination to wage determination depending on the
circumstances.... Guidance may also be obtained from the
way different jobs are rated under Federal pay systems
(Federal Wage Board Pay System and the General Schedule)
or from other wage determinations issued in the same
locality. Basic to the establishment of any conformable
wage rate(s) is the concept that a pay relationship
should be maintained between job classifications based on
the skill required and the duties performed.
29 C.F.R. [sec] 4.6(b)(2)(i)(A)(1985).
It is noted that the previous contract or went through the
conformance process and established that the dispatcher
classification was equivalent to a General Schedule rating of GS-3,
step 2, which required a wage rate of $5.29 per hour. At that time
the contractor, dispatchers, and the contracting agency agreed
that this was the appropriate rate.
Petitioner arrives at its $4.00 per hour proposal by comparing
the percentage differences between a dispatcher classification in
the Invitation for Bid (IFB) and rates for a GS-9 supervisor and a
GS-7 console operator. Petitioner has apparently assumed that the
Wage Determinations for the two listed classifications were based
on a percentage of the GS-9 and GS-7 General Schedule rates. The
record submitted by the Wage and Hour Division which contains the
basis on which the Wage Determinations were determined, clearly
shows that General Schedule equivalencies were used in determining
all three rates. However, rather than [3]
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[4] using the GS-9 and GS-7 rates, it had been determined that the
skills and tasks involved in the proposed procurement were comparable to
positions at the GS-7 and GS-5 level. I find that the record amply
demonstrates that the Wage and Hour Division has consistently used the
General Schedule in determining the wage rates on this contract.
Further, its methodology of using the GS-3 General Schedule in
determining the dispatcher position classification was consistent and
bore a reasonable relationship to the two classifications listed in the
Wage Determination. /FN2/ The $4.00 per hour rate urged by Petitioner
would be approximately equivalent to a GS-1 General Schedule rate which,
considering the skill level, is markedly less reasonable than the Wage
and Hour Division's determination.
Petitioner notes that it has incurred financial losses on this
contract and urges a favorable ruling to reduce its losses. This is
not a factor which I may consider under the Act and the regulations
in reviewing a challenged wage determination.
In summary, I conclude that the conformed wage rate
established by the Wage and Hour Division for the classification of
dispatcher was in accord with the applicable regulations. The [4]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN2/ Work papers contained in the record submitted by the
Administrator (p. 45) show that all three rates were based on
General Schedule rates in descending order of skill levels with the
training technician position based on the GS-7 level, the training
specialist based on the GS-5 level and the dispatcher based of the
GS-3 level. [4]
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[5] decision of the Administrator is AFFIRMED.
[Dennis E. Whitfield]
Under Secretary of Labor
Dated: December 18, 1985
Washington, D.C. [5]
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