CCASE:
ZAPATA GULF MARINE V. DOL
DDATE:
19910116
TTEXT:
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[1] U.S. DEPARTMENT OF LABOR
DEPUTY SECRETARY OF LABOR
WASHINGTON, D.C.
20210
DATE: January 16, 1991
CASE NO. 87-SCA-WD-5
IN THE MATTER OF
ZAPATA GULF MARINE CORPORATION,
v.
ADMINISTRATOR, WAGE AND HOUR
DIVISION, EMPLOYMENT STANDARDS
ADMINISTRATION, UNITED STATES
DEPARTMENT OF LABOR.
BEFORE: THE DEPUTY SECRETARY OF LABOR /FN1/
FINAL DECISION AND ORDER
This matter is before me pursuant to the McNamara-O'Hara
Service Contract Act of 1965, as amended (MOSCA), 41 U.S.C. [secs]
351-358 (1982), and implementing regulations set forth at 29 C.F.R.
Parts 4 and 8 (1989). Petitioner, Zapata Gulf Marine Corporation
("Zapata" or "Petitioner"), seeks review of an October 5, 1987,
ruling by the Administrator of the Wage and Hour Division affirming
Wage Determination ("WD") No. 83-906 (Rev. 2), dated November 19,
1986. The WD was issued in response to a request by the United
States Department of the Navy, Military Sealift Command (MSC), for
a wage determination for the operation and maintenance of seven
ocean-going Fleet Tugs. MSC included WD No. 83-906 (Rev. 2) in the
provisions of its Request for Proposal [1]
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/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 (1989). [1]
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[2] (RFP) No. N00033-87-R-4005. The RFP is being conducted in
accordance with Office of Management and Budget Circular A-76 to
determine the cost effectiveness of contracting out these tug boat
services which are presently performed by civil service mariners.
On August 20, 1987, Zapata, a potential bidder under the
solicitation, requested review and reconsideration of WD No. 83-
906 (Rev. 2) by the Administrator pursuant to 29 C.F.R. [sec] 4.55.
In support of Petitioner's claim that the WD does not accurately
depict the prevailing wages and fringe benefits being paid in the
industry, the request included two wage and benefit surveys of
companies engaged in towing operations. Petitioner's principal
basis for challenging the Administrator's WD are these surveys and
a contention that the Administrator did not give "due
consideration" to wage rates being paid Federal employees who
perform similar work as required by 29 C.F.R. [sec] 4.51(d). In
response to Petitioner's request, the Administrator concluded that
"in the absence of more probative data, we must conclude that the
data presented were insufficient to develop a wage determination
specifically designed for towing services, and we must reaffirm the
appropriateness of WD 83-906 (Rev. 2) to towing services."
Administrative Record (A.R.), Exh. R-3.
The Service Contract Act provides, inter alia, that every
federal contract in excess of $2,500, the principal purpose of
which is to furnish services to the United States through the use
of service employees, shall contain a provision specifying [2]
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[3] minimum wages to be paid various classes of service employees, as
determined by the Secretary, in accordance with prevailing wages
for such employees in the locality. 41 U.S.C. [sec] 351(a). The
regulations at 29 C.F.R. Part 4 provide that the Administrator,
Wage and Hour Division, shall issue wage determinations specifying
these prevailing wages and fringe benefits for such service
contracts. 29 C.F.R. [sec] 4.3. The regulations further require
that:
[t]he wage rates and fringe benefits set forth in such
wage determinations shall be determined in accordance
with the provisions of sections 2(a)(1), (2), and (5),
4(c) and 4(d) of the Act from those prevailing in the
locality for such employees, with due consideration of
the rates that would be paid for direct Federal
employment of any classes of such employees.
29 C.F.R. [sec] 4.3(b). Further guidelines for determining
prevailing wages provide:
(a) Information considered. The minimum monetary wages
and fringe benefits set forth in determinations of the
Secretary are based on all available pertinent
information as to wage rates and fringe benefits being
paid at the time the determination is made. Such
information is most frequently derived from area surveys
made by the Bureau of Labor Statistics, U.S. Department
of Labor, or other Labor Department personnel.
Information may also be obtained from Government
contracting officers and from other available sources,
including employees and their representatives and
employers and their associations.
29 C.F.R. [sec] 4.51(a).
The November 1986 wage determination at issue here, WD 83-
906 (Rev. 2), was based on the most recent (November, 1985) BLS
survey of the wages and benefits paid to 4,150 employees working
on deep sea transport vessels (excluding passenger, tanker and
inland water ships) of more than 5000 power tons. Petitioner [3]
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[4] does not dispute the validity of WD 83-906 (Rev. 2) but does
dispute its applicability to the types of operations to be
performed under this solicitation. Petitioner's Statement at 5.
Petitioner asserts that this case presents the following two
distinct issues to be considered:
1. Whether the operations to be performed under the RFP
are customarily performed by the deep sea, dry cargo
industry;
2. Whether the supporting data submitted by Zapata
provides sufficient evidence that would warrant the
formulation of a new wage determination applicable to the
ocean-going tug industry.
Statement of the Petitioner at 4. /FN2/
The MSC submitted mission requirements to be performed by its
military fleet tugs. A.R., Exh. R-4, Mission Requirements at 362.
MSC assigns civilian mariner personnel to operate and maintain
these vessels. Id. at 534. Concerning Petitioner's first issue,
the MSC's fleet tug operations are a hybrid operation. The ocean
going tugs described by the Navy are at sea for extended periods of
time and, therefore, the deep sea characterization of the duties
performed for wage determination purposes is proper. Extended deep
sea duties are evident throughout the MSC's Mission Statement, e.g.
providing hotel services for government personnel while on-board;
affording training support for diving operations lasting one to two
weeks; [4]
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/FN2/ Petitioner also requests oral argument in this matter.
Because I find that the petition, the parties' statements and the
Administrator's written record on which her decision was based
provide an adequate record of the facts and issues in this case,
this request is denied. [4]
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[5] conducting deep sea ocean searches for three to four week
periods. Id. at 389, 390, 391. See also Id. at 371 and 387.
In contrast, nothing in the record before the Administrator
provides any evidence that commercial tug crews conducted such
extended deep sea duty, /FN3/ although there may be some duties
common to both the MSC fleet tug and commercial tug operations.
Thus the operations to be performed under the RFP are more similar
in nature to the deep sea, dry cargo industry than to the typical,
close-to-shore tug operations.
Concerning Petitioner's second issue, the two surveys
submitted in support of Petitioner's contention that the WD rates
are excessive fail to demonstrate this premise. For instance, the
WD contains nineteen classifications whereas the surveys proffered
by Petitioner include a total of eight classifications, only four
of which are in the WD: oiler, able bodied seaman, ordinary
seaman, cook. Comparison of the classifications and daily wage
rates common to the WD and the surveys submitted by Petitioner
shows that the wage rates contained in the WD are lower than those
paid in the tug industry. A.R., Exh. R-2, R-10. Thus the
supporting data submitted not only fail to provide sufficient
evidence to warrant the formulation of a new WD [5]
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/FN3/ Zapata's Petition to the Deputy Secretary included pictures
of tug boats performing tasks similar to some of those contained in
MSC's mission requirement and two affidavits -- one by the
Personnel Manager of a towing company attesting to the accuracy of
wage surveys offered by Petitioner, and one from an individual
purportedly having extensive experience and knowledge of the towing
industry. However, Petitioner failed to submit these documents to
the Administrator for consideration and under the regulations, I
may not consider them. 29 C.F.R. [sec] 8.6(e). [5]
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[6] applicable to the ocean-going tug industry, but they are also
too sparse to significantly challenge the Administrator's decision
in this matter.
Similarly, there is no data contained in the surveys proffered
by Petitioner to support the premise that fringe benefits are less
than those contained in the WD. Petitioner's only evidence
consists of the two aforementioned surveys. /FN4/ The fringe
benefits in the WD reflect the more liberal benefits accorded to
mariners who are at sea for extended periods of time. Petitioner
has not shown that employees in the commercial tug industry
regularly operate on the open seas for extended periods of time.
As for Petitioner's argument that the Administrator did not
give "due consideration" to wage rates being paid Federal employees
who perform similar work, the fact that the Administrator did not
adopt the federal wage rates does not mean that "due consideration"
was not given. Where it is apparent that the federal wage rate is
only one of the elements of the local prevailing wage, the Act
gives the Administrator discretion to determine the extent to which
the disparity is justified. See AFGE v. Donovan, 93 Lab. Cas.
(CCH) 34,177 (D.D.C. 1982). This principle is valid whether the WD
rates are higher or lower than the federal rates. See In the
Matter of Tri-States Service [6]
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/FN4/ Petitioner's request for reconsideration to the Administrator
also contained a copy of the daily wage rates paid to MSC's
civilian mariners, but this data previously was sent by MSC to the
Administrator in requesting a WD as required by 29 C.F.R. [sec]
4.4(b). [6]
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[7] Company v. Administrator, Wage and Hour Division, Employment
Standards Administration. United States Department of Labor,
Decision of the Deputy Secretary, Case No. 85-SCA-WD-12, September
28, 1990, slip op. at 6-7. Here, as her letter states, the
Administrator gave "due consideration" to "the Federal Pay System"
but, in her discretion, did not find any disparity between Federal
pay and the WD sufficient to reject the WD.
Petitioner has failed to show by a preponderance of the
evidence that there should be a distinct Wage Determination based
on a survey of an ocean going fleet towing industry which provides
the same missions as required by the MSC under this RFP and whose
wages would be less than those contained in the existing WD.
Accordingly, the Administrator's decision is AFFIRMED. 29 C.F.R.
[sec] 8.6(e).
SO ORDERED.
[Roderick DeArment]
Deputy Secretary of Labor
Washington, D.C.[7]
