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<![CDATA[
CCASE:
AMERICAN PHOTOGRAPHIC INDUSTRIES
DDATE:
19870814
TTEXT:
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[1] U.S. DEPARTMENT OF LABOR
DEPUTY SECRETARY OF LABOR
WASHINGTON, D.C.
20210
DATE: August 14, 1987
CASE NO. 85-SCA-WD-2
IN THE MATTER OF
AMERICAN PHOTOGRAPHIC INDUSTRIES, INC.
and
ADMINISTRATOR, WAGE AND HOUR DIVISION,
EMPLOYMENT STANDARDS ADMINISTRATION,
UNITED STATES DEPARTMENT OF LABOR
BEFORE: THE DEPUTY SECRETARY OF LABOR
FINAL DECISION AND ORDER
This matter is before me /FN1/ pursuant to the Service
Contract Act of 1965, as amended (SCA), 41 U.S.C. [secs] 351-358
(1982), and the rules and regulations promulgated thereunder, 29
C.F.R. Parts 4 and 8 (1986). Petitioner seeks review of the Deputy
Administrator's March 25, 1985, final ruling denying additional
classifications and rates for photo lab technician and paste-up and
lay-out artist.
Petitioner contracted with the United States Air Force at
Wright-Patterson Air Force Base to perform audiovisual services
such as photographic and graphic services and operation of an
audiovisual library. The contract was awarded on June 1, 1983, [1]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN1/ The Deputy Secretary has been designated by the Secretary to
perform the functions of the Board of Service Contract Appeals
pending the appointment of a duly constituted board. 29 C.F.R.
[sec] 8.0 (1986); Department of Labor Executive Level Conforming
Amendments of 1986, Pub. L. No. 99-619 (November 6, 1986). [1]
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[2] for the period through September 30, 1983, and was subject to
Wage Determination (WD) No. 77-399, Revision 5. The contract
contained an option for the period October 1, 1983 through
September 30, 1984, which was exercised on September 1, 1983. On
September 10, 1983, Petitioner became subject to revised Wage
Determination WD-77-399 Revision 6. On November 10, 1983, the
contract was terminated for default and Petitioner has subsequently
filed a Petition for Reorganization under Chapter 11 of the
Bankruptcy Act. /FN2/
The question before me is whether or not the Administrator
acted properly and in accordance with applicable regulations in
denying Petitioner's request for conformed wage rates for two
additional classifications, photo lab technician and paste-up and
lay-out artist, at wage rates less than existing classifications
involving work of similar skills. Petitioner had requested
conformed rates for other classifications which were resolved
without further dispute.
The Air Force contracting officer initially denied
Petitioner's request for these two additional classifications.
Based on Petitioner's disagreement with the decision and pursuant
to 29 C.F.R. [sec] 4.6(b) (1983), the contracting officer submitted [2]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN2/ On March 26, 1986, Petitioner submitted a Notice of Pendency
of Bankruptcy Proceedings and Notice of Withdrawal of Counsel which
requested that these proceedings be stayed pending action of the
bankruptcy court. However, the automatic stay provision of the
Bankruptcy Reform Act, 11 U.S.C. [sec] 362(a) (1982), does not
preclude the continuation of this proceeding which was initiated by
Petitioner. Cf. In re Habitech, Inc., 25 Wage & Hour Cas. (BNA)
459 (1983). [2]
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[3] the question to the Office of Government Contract Wage
Standards, Wage and Hour Division. The Director of that office
issued a ruling on April 6, 1984, which affirmed the contracting
agency's decision. He found that the skills involved in the work
of the photo lab technician and those of the paste-up and lay-out
artist were similar in skill levels to the class III exhibits
specialist and photographer listed on the wage determination and,
therefore, the rate of $7.14 per hour was appropriate. Petitioner
had requested a rate of $6.00 for photo lab technician and $6.35
for paste-up and lay-out artist.
Petitioner then appealed to the Administrator and a decision
affirming the Director's previous ruling was issued by the Deputy
Administrator on March 25, 1985. Petitioner then filed a petition
for review (later amended). The petition as amended is before me
for review.
In its petition, Petitioner argues that the Administrator
failed to give due consideration to wages prevailing in the
locality, and to wages paid to Federal employees performing similar
work. /FN3/ The Administrator contends that the only test which
must be met in establishing a conformed rate is that it bear a
"reasonable relationship" to those listed in the wage
determination. Statement on Behalf of the Deputy Administrator at
6. This statement may suggest an overly narrow
interpretation [3]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN3/ Section 2(a)(5) of the SCA, 41 U.S.C. [sec] 351(a)(5),
requires that the Secretary shall give "due consideration" to wages
paid employees performing similar work and hired directly by the
Federal government. [3]
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[4] of this section of the regulations, 29 C.F.R. [sec]
4.6(b)(2)(iv)(A) (1986), since the WD to which the conformed rate
must bear a reasonable relationship is required to take into
account the wages paid to Federal employees performing similar
work. Therefore, a conformed rate must, at least indirectly,
reflect wage rates paid to Federal employees in similar jobs. Here
the record shows that federally employed photographers are paid
base rates ranging from $6.64 through $10.06 per hour plus fringe
benefits and illustrators' base rates range from $8.23 through
$10.06 per hour. Administrative record, Exhibit 5. These rates do
not support Petitioner's claim that the $7.14 per hour WD for the
classification of photographer III and illustrator III are
substantially higher than those paid to Federal employees
performing similar work. Nor has Petitioner demonstrated that the
rates found by the Administrator to be appropriate are
substantially higher than wages prevailing in the locality.
Petitioner's second argument is that the WD is contrary to
applicable statutes and regulations and therefore invalid or in the
alternative, that the regulations are contrary to the statute and
thus, as applied, are unconstitutional. Petitioner offers no
support for and I find no basis for these assertions.
Petitioner alleges that it was deprived of its due process and
equal protection rights guaranteed by the constitution. I find
that the contracting agency and the Administrator acted in
accordance with the applicable regulations. The procedures in 29
C.F.R. [sec] 4.6(b)(2) were followed. These essentially provide [4]
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[5] that, failing to reach an agreement on a conformed rate
among the contractor, employees, and contracting agency, the agency
must submit the question along with its recommendation to the
Office of Government Wage Standards of the Wage and Hour Division
for a final decision. This was done.
As to Petitioner's claim that the contracting agency and Wage
and Hour Division were untimely in their response, the Deputy
Administrator points out that, had the decision been in favor of
Petitioner, the rates would have been adjusted retroactively.
Deputy Administrator's statement at 11. Thus, no harm has been
demonstrated inasmuch as Petitioner was legally obligated to pay
wage rates in accordance with the wage determination contained in
the contract on which it bid.
Included in Petitioner's claim that it was deprived of due
process and equal protection rights is a reference to unequal
treatment by the Agency with respect to wage rates as compared to
Petitioner's predecessor and successor. As the Deputy
Administrator's response notes, this claim was merely an
unsupported assertion which had not been raised before. It may not
form a proper issue for this appeal. See 29 C.F.R. [sec] 8.6(e).
Finally Petitioner faults the contracting agency, alleging
that it failed to follow the applicable regulations by not seeking
an agreement between all parties prior to submitting the matter to
the Department of Labor for determination. The applicable
regulations, 29 C.F.R. [sec] 4.6(2)(b) (1983), provide only that,
if there is no agreement, the matter is to be submitted to the [5]
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[6] Department of Labor. There are no requirements concerning
the extent to which the agency must seek an agreement and the
record indicates that the applicable procedures were adhered to
adequately.
In summary, although Petitioner may have extensive knowledge
of the photographic industry, it failed to provide to the Deputy
Administrator substantive evidence that the disputed WDs were, in
fact, higher than true prevailing rates. Nor does the record
afford any basis for finding any impropriety in the Deputy
Administrator's denying the request for new classifications.
Accordingly, the decision of the Deputy Administrator of March
25, 1985, is AFFIRMED.
SO ORDERED.
[Dennis E. Whitfield]
Deputy Secretary of Labor
Washington, D.C. [6]
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