A.O.K. CONSTRUCTION CORP., 1986-DBA-166 (ALJ May 10, 1988)
CCASE:
A.O.K. CONSTRUCTION CORPORATION,
DDATE:
19880510
TTEXT:
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[1] [88-27.WAB ATTACHMENT]
U.S. Department of Labor Office of Administrative Law Judges
1111 20th Street, N. W.
Washington D.C. 20036
In the Matter of No. 86-DBA-166
Proposed debarment for labor Date: 10 May 1988
standards violations by:
A.O.K. CONSTRUCTION CORPORATION,
ANTHONY ODIERNO,
President-Treasurer,
Respondents
With respect to laborers and mechanics
employed by the above contractor under
Department of the Army Contract No.
DACA 51-83-C-0188, Renovate Building 900,
Stewart Army Subpost, New Windsor, New York.
Before: George A. Fath, Administrative Law Judge.
DECISION AND RECOMMENDATION
This case arises under the provisions of the Davis-Bacon
Act, as amended, 40 U.S.C. [sec] 276(a) et seq. [hereinafter, the
Act], and was referred to this office for hearing by Order of
Reference filed on 31 July 1985, pursuant to 29 C.F.R. [sec]
5.12(b). The parties have agreed to submit the case, without a
hearing, for decision based on the following stipulated facts:
1. A.O.K. Construction Corporation [hereinafter, "A.O.K."]
maintains an office at 1079 Yonkers Avenue, Yonkers, New York,
and Anthony Odierno is its President-Treasurer.
2. A.O.K. was awarded a contract for a construction project by
the Department of the Army, Contract No. DACA 51-83-C-0188, dated
September 9, 1983 [hereinafter, "the contract"] to repair/replace
concrete stairs, stairwells, sidewalk and curbs, at Stewart Army
Subpost in New Windsor, New York, for the lump sum of $287,300.
3. Work performed on the Contract, among other things, was
subject to the specifications and requirements of the Davis-Bacon
Act, as amended, 40 U.S.C. [sec] 276(a) et seq.; Department of
Labor regulations, 29 C.F.R. Part 5; and prevailing wage rate
classifications and rates specified in Wage Decision No. NY 83-
3018 of the Secretary of Labor dated May 20, 1983, with which
A.O.K., by Anthony Odierno, agreed to comply in executing the
Contract. [1]
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[2] 4. A.O.K. performed work on the Contract during the period
September 30, 1983 through October 16, 1984.
5. A labor standards investigation conducted by the District Labor
Advisor, U.S. Army Corps of Engineers, New York District, of
A.O.K.'s performance under the Contract found the following
violations of the Contract's provisions and requirements:
(a) A.O.K. had not paid 8 employees certain holiday pay
as required by Wage Decision No. NY 83-3018, and the
Contract, resulting in wage underpayments totalling
$2480.00;
(b) A.O.K. had not paid one employee who had performed
masons' and carpenters' work the prevailing hourly wage
rate required by Wage Decision No. NY 83-3018 and the
Contract for such work and had misclassified and paid the
employee as a laborer; and
(c) After the labor standards investigator pointed
out the apparent violation described in paragraph 5(b),
A.O.K. corrected the wage rate but also reduced the
number of hours worked as shown on the original payroll
records from 8 to 7 hours per day in supplemental payroll
records certified to be correct by Anthony Odierno.
6. A.O.K. promptly made full restitution of wage
underpayments in the amount of $2,480.00 to the 8 employees
referred to in paragraph 5(a), above. A.O.K. also made full
restitution of wage underpayments in the amount of $1018.13 to the
one employee referred to in paragraph 5(b) and (c), reflecting the
prevailing wage rate for masons' and carpenters' work for 8 hours
of work per day.
7. By letter dated January 17, 1986, the Assistant Administrator,
Wage and Hour Division, Employment Standards Administration, U.S.
Department of Labor, advised A.O.K. of the violations found by the
Department of the Army's labor standards investigation regarding
its performance on the Contract; advised A.O.K. of his finding of
reasonable cause to believe that the violations constitute a
disregard of A.O.K.'s obligations to its employees within the
meaning of Section 3(a) of the Davis-Bacon Act; and offered A.O.K.
the opportunity to request a hearing before a Department of Labor
Administrative Law Judge before submitting the matter to the
Comptroller General of the United States for consideration in
applying the ineligibility sanctions provided in Section 3(a) of
the Davis-Bacon Act. [2]
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[3] 8. A.O.K. by its President, Anthony Odierno, timely requested
a hearing in this matter by letter dated February 6, 1986.
9. By Order of Reference dated June 11, 1986, the Assistant
Administrator, Wage and Hour Division, subsequently referred this
matter to the Office of Administrative Law Judges for hearing on
the issues of whether A.O.K. and Anthony Odierno disregarded their
obligations to their employees within the meaning of Section 3(a)
of the Davis-Bacon Act and, therefore, should be debarred.
10. A.O.K. has no prior record of violations of the Davis-Bacon
Act in over 20 years of performing federal government contract
work.
11. A.O.K. performed all its other federal government contract
work during the years 1980-83 in the State of New Jersey, where it
was not required to pay for holidays for laborers as it was by the
applicable Wage Decision in the Contract in New York.
12. A.O.K. claims that it unsuccessfully advertised for and
attempted to hire a union mason and carpenter to work on the
Contract before it used the one employee referred to in paragraph
5(b), above, a young relative who had been hired as a laborer, to
help out on masons' and carpenters' work in order to complete the
Contract on time.
The stipulated facts are consistent with the record, and
are hereby adopted in this opinion. The findings and conclusions
below are based upon all of the exhibits in evidence, the
stipulated facts, and a review of the applicable statutes,
regulations, and case law.
The government contends that the contractor's failure to
pay the proper wage rate to Mario Laucella for his work as a
mason and carpenter, the failure to pay holiday wages to eight of
its employees, and the submission of supplemental payrolls that
were inconsistent with the original certified payrolls
constituted a disregard of its duties to its employees. In
support of its recommendation that A.O.K. be debarred, the
government relies on In the Matter of Marvin E. Hirchert, WAB
No. 77-17 (16 October 1978). In Hirchert, the Wage Appeals Board
held that:
Petitioner's action in paying wage rates far below the
predetermined rate, submitting falsified certified
payrolls and failure to pay overtime cannot be considered
as anything short of a disregard of Petitioner's
obligations to its employees.
Id. at 6. [3]
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[4] The violations are admitted. The contentions of A.O.K. and
its principal that their actions were unintentional do not prevail
against the Act. Moreover, they offer no legal support for their
defenses. Accordingly, the sanctions of the Act must be imposed.
Further, the government contends that the inconsistency
between the original certified payroll and the supplemental
certified payroll constitutes an "extreme form of disregard to its
employees" under In the Matter of Thomas L. Moore, President, and
T.A.M., Inc., WAB 79-05 (16 August 1979). In Moore, the Wage
Appeals Board held that a petitioner's submission of reconstructed
and erroneous certified payrolls cannot be explained by lack of
intent resulting from inexperience when petitioner was, in fact,
simulating compliance with provisions of the Davis-Bacon Act. Such
reconstruction of payroll records was found to be an extreme form
of disregard by petitioner of its obligations to its employees
under Section 3(a) of the Davis-Bacon Act. Id.
The violations are admitted. A.O.K.'s defense, that its
actions were unintentional, is untenable under Moore, and fails
to preclude debarment in this case. This defense does not prevail
against the Act. I find that A.O.K.'s failure to pay the required
wages to its employees constitutes a disregard of its obligations
to its employees and supports debarment in this case.
Recommendation
Based upon the above findings, it is hereby recommended that
the respondents, A.O.K. Construction Corporation and Anthony
Odierno, be debarred under Section 3(a) of the Act, 40 U.S.C.
276a-2(a), which provides in pertinent part:
[T]he Comptroller General of the United States is further
authorized and is directed to distribute a list to all
departments of the government giving the names of persons
or firms whom he has found to have disregarded their
obligations to employees and subcontractors. No contract
shall be awarded to the persons or firms appearing on
this list or to any firm, corporation, partnership, or
association in which such persons or firms have an
interest until three years have elapsed from the date of
publication of the list containing the names of such
persons or firms.
GEORGE A. FATH
Administrative Law Judge [4]
