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<![CDATA[
CCASE:
GEORGIA BRANCH V. SOL
DDATE:
19650301
TTEXT:
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[1] UNITED STATES OF AMERICA
DEPARTMENT OF LABOR
DECISIONS AND ORDERS OF THE WAGE APPEALS BOARD
In the Matter of
WAB Case
The Determination of the Prevailing No. 65-01
Wage Rates Applicable to Construction
of Main Dam, Excavation for Spillway
and Intake Channel of Carters Dam,
Murray County, Georgia Dated
March 1, 1965
Georgia Branch, Associated
General Contractors
of America,
Petitioner
Messrs. Robert H. Strickland, Harry L. Fox
and Arthur F. Hintze for the
Petitioner
Paul A. Tenney,
for the Solicitor of Labor.
Before: Smith, Chairman, Barker and Rothman, Members
DECISION OF THE BOARD
STATEMENT OF THE CASE
This is a proceeding under Order No. 32-63 of the Secretary of
Labor, as amended, following a petition for review filed on January
28, 1965, by the Georgia Branch of the Associated General
Contractors of America, hereinafter called the petitioner, pursuant
to the Wage Appeals Board Rules of Procedure, Part 7, (29 CFR,
Subtitle A). The petition requests review of the rates contained
in wage determination No. AD-9,387, dated December 29, 1964, as
modified by Determination No. AD-9,787, dated January 28, 1965,
issued pursuant to the Davis-Bacon Act, (40 U.S.C. 276c) and
Department of Labor Regulations, Part I (29 CFR, Subtitle A). [1]
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[2] Wage Determination No. AD-9,387, which in fact was
superseded by Wage Determination AD-9,787, applies to the Phase 2
Contract for Carters Dam and involves the construction of the main
dam, the excavation for the spillway and intake channel of the
Carters Dam, located in Murray County, Georgia.
All known interested parties were notified that the petition
had been filed and were requested to submit all written statements
by February 19, 1965. The case was set for oral hearing on
February 25, in Conference Room 102, Main Labor Building, 14th
Street and Constitution Avenue, Washington, D.C. The following
organizations, although notified that the petition had been filed
did not submit statements:
Corps of Engineers, U.S. Army
National Constructors Association
National Joint Heavy and Highway Construction Committee
Building and Construction Trades Department, AFL-CIO
International Union of Operating Engineers
International Hod Carriers, Building and Common Laborers Union
International Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America.
The Associated General Contractors of America filed a written
statement in advance of the hearing. The International Brotherhood
of Electrical Workers, AFL-CIO, filed a supplementary Petition,
alleging that the rate predetermined for electricians in the
subject determination was lower than that prevailing in the area
for that classification. This petition was withdrawn at the
opening of the hearing with the consent of the Board.
Additionally, the Association of Crushed Stone Producers of
North Georgia was permitted to submit a statement in behalf of the
petition, on the date of the hearing, outside the February 19 filing
time, the Board reserving the prerogative of excluding evidentiary [2]
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[3] material which should have properly been before
the Solicitor in the preliminary stages of the case.
The petitioner and the Solicitor, through respective
representatives presented argument at an oral hearing pursuant to
the agreed notice on February 25, 1965. The Building and
Construction Trades Department, AFL-CIO, and the Association of
Crushed Stone Producers of North Georgia, through respective
counsel, also made brief statements. The petitioner submitted
written statements at the beginning of the hearing, which were
accepted although filed out of time with the same understanding
upon which the Stone Producers statements were accepted.
Inasmuch as Wage Determination AD-9,387 is more inclusive than
AD9,787 which superseded it, the petitioner, upon inquiry from the
Board, indicated that only those rates for laborers, truck drivers
and power equipment operators in Wage Determination AD-9,787 were
questioned.
FINDINGS OF FACT
1. THE PROJECT
Wage Determination AD-9,387 as changed by AD-9,787 is for the
proposed construction of the main dam, excavation for the spillway
and intake channel of Carters Dam in Murray County, Georgia.
Carters Dam is located on the Coosawattee River, which is one
of the head waters of the Coosa River. The Dam site is just east
of Carters, Georgia (pop. 100). The dam site is about 30 miles
from Rome, Georgia (Floyd County, pop. 32,226) about 60 miles north
of Atlanta, Georgia (pop. 1,011,100), and about 50 miles southeast
of Chattanooga, Tennessee (pop. 286,700 met. area). The entire dam
site is within the borders of Murray County. The overall dam and
the reservoir project, however, is located in a number of other
counties.
The main dam will be a rock fill dam about 450 feet high. The
following work items will be involved: Clearing and stripping (350,000 [3]
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[4] c. yd.), abutment stripping (300,000 c. yd.), 2
coffer dams (temporary dams used to divert water into the diversion
channel), foundation drilling, testing and grouting (23,000 lin.
ft. of holes being about 2 to 3 inches in diameter), foundation
preparation (326,000 sq. yd.), impacted impervious fill mostly clay
(1,862,000 c. yd.), rock fill (12,400,000 c. yd.), rolling for
compaction (this is in connection with the impervious fill), haul
roads, scaling (300 man-hours), 1,000 eight-foot slotted rock
bolts, 1,000 twelve-foot rock bolts and 500 thirty-foot groutable
bolts, 7,000 c. ft. of grout for foundation preparation, 2,000
c. yd. of concrete for foundation preparation, pre-splitting,
chain-link fabric in place (safety measure), horizontal
displacement gauges (8,230 lin. ft.), vertical displacement gauges
(2,080 lin. ft.), Instrumentation rooms (open places for
displacement gauges).
The proposed construction is Phase II of Carters Dam. Data
submitted to the Solicitor of Labor by the Corps of Engineers
indicates that the wages for laborer, power equipment, and truck
driver classifications listed in wage determinations AD-9,787 were
those paid during the last six weeks of performance of Contract No.
DA01-076-CIVENG-64-193 for Phase I. This contract was performed by
the Ryan Contracting Company, Inc., who is an AGC member of another
state. The contract was in the amount of about $1-3/4 million.
The wages were paid for the workweek ending November 15, 1964,
through that of December 26, 1964. The wages reflect those
required by applicable collective bargaining agreements which the
contractor has with the Laborers Local No. 752 of Rome, Georgia,
and Operating Engineers Local 926 of Atlanta, Georgia.
The wages paid by the Ryan Contracting Company before the
workweek ending November 15, 1964, were lower than those paid
during the final six weeks. The petitioner estimates that lower
wages were paid for 90 percent of the contract work involved. [4]
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[5] 2. SUMMARY OF SOLICITOR'S ACTIONS
The record shows that when, on November 20, 1964, the
Solicitor of Labor issued Wage Determination AD-5,737 applicable to
Phase II of Carters Dam the rates contained therein were based on
payroll data obtained from the Corps of Engineers, the contracting
agency, except for the ironworker rate which was the rate
negotiated for nearby Chattanooga.
Subsequently, however, wage data was submitted to the
Solicitor's Office indicating payment of higher rates than those
predetermined in November and the wage determination was superseded
(AD-9,387) to reflect the increased rates. In this determination
additional laborer and power equipment classifications were
included.
At this point the record indicates that the petitioner
protested to the Solicitor's Office that the rates were higher than
those prevailing in the area and urged the adoption of the rates
paid on Phase I of the Carters Dam Project.
Thereupon, payroll evidence was obtained from the Corps of
Engineers as to the rates being paid on the project. The Corps
submitted summaries of payrolls for the year 1964 and Wage
Determination AD-9,387 was changed to reflect only those
classifications and rates adequately supported by data from recent
payrolls.
The record reveals that the petitioner protested by letter
dated January 23, 1965, the rates predetermined in AD-9,387.
However, the letter was not received in the Department of Labor
Mail Room until near close of business on January 25, thus it is
not clear whether it was in the hands of the wage determination
personnel before the issuance of the amended decision AD-9,787 on
January 27. This letter contained no wage data concerning the
rates actually being paid on construction of Carters or on other
construction projects in the area. [5]
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[6] PROCEDURAL COMMENTS
In view of the nature of the record and the procedures
followed in this case, the Board feels constrained to make certain
procedural comments in respect to the presentation of cases before
the Board.
The Board's Rules and Regulations at Section 7.5(4) provide
that the petitioner set forth that he has requested the Solicitor
to modify or otherwise change the wage determination in question
and describe briefly the action taken by the Solicitor. This
requirement provides an opportunity for the petitioner to review
the record upon which the Solicitor made his determination, to
supplement that record if he believes it incomplete, and to assure
that facts he believes Pertinent have been presented to and argued
before the Solicitor prior to the filing of any appeal to this
Board.
The Wage Appeals Board is an appellate board and must operate
under procedures appropriate for this type of body. It will not
ordinarily undertake the hearing of a wage determination matter de
novo. It is a review body. The Board is not interested in the
observance of technical rules but desires to assure that its
actions are based on pertinent facts fully disclosed in the record
and available to all interested persons. The Board's oral
proceedings are designed to provide argument upon such facts, and
upon applicable precedent and law; thereby assisting the Board in
arriving at a just decision. While the possibility of returning a
case to the Solicitor may exist in a situation where petitioner has
failed to review and fully develop the record before the Solicitor,
this frequently is not feasible in view of contract deadlines and
the need for getting on with the Government's business.
The instant petition indicates that the request for
reconsideration and the reconsideration action occurred by
telephone. This hardly suggests a diligent effort by petitioner to
review the record before the Solicitor to determine that all
pertinent facts were disclosed to the Solicitor, or to see that
such facts would be available to the Board upon its later review. [6]
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[7] The Board believes that the best interests of all parties
will be served and the work of the Board facilitated if future
petitioners avail themselves of the opportunity contemplated by the
regulations to assure that a complete record is before the
Solicitor, that the Solicitor is asked to consider this full
record, and that a written response to this reconsideration request
is obtained.
ISSUES AND CONCLUSIONS
1. ISSUES
Issues raised by petitioner include (1) the area to be
considered, (2) the similarity of work, and (3) the rates on such
work within the area.
1. Area. The Solicitor's position as to area is that "section
1.6(b) of the Department's applicable rules provides in effect that
the Solicitor of Labor may look beyond the city, town, village, or
other civil subdivision of the State in which the work is to be
performed (such as the county) only if there has been no similar
construction within that area within the past year.
"In the instant case, there has been significant similar
construction carried out in the vicinity of Carters, Georgia, which
is in Murray County. Therefore section 1.6(b) would seem to
proscribe the examination of construction beyond the borders of
Murray County."
At the initiation of Carters' project in 1962, the Solicitor
did consider work in the adjacent counties as there was not then
any similar construction within Murray County.
While petitioners' written position in respect to area is that
the Solicitor should have considered similar work in counties
adjacent to Murray, he abandoned this position at the hearing. In
response to question of the Board at the oral proceeding,
petitioner requested that the predetermination be based upon the
mid-1964 rates paid on the one job -- Carters Dam -- in Murray County. [7]
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[8] 2. Similar Work. The Solicitor's position is that the nearby
highway projects in adjacent counties, even if adjacent counties
were used, "appear to be dissimilar to the Carters Dam project,"
and were considered in the initial determination only because there
was then no more similar work in Murray or the adjacent counties.
Petitioner argues vigorously that nearby highway work in the
adjacent counties (as well as certain soil conservation work),
particularly Interstate Highway 75, is in fact similar work. It is
agreed that there is no highway work in Murray County that is
similar to the dam work.
The Board notes that there is in effect between petitioner and
Local 926 of the Operating Engineers, applicable to Murray and the
adjacent counties, a collective bargaining agreement which includes
in its scope ". . . subways, dams, reservoirs, disposal plants,
bridges, railroads, streets (paving and repair), road building
construction (including grading and repairing), . . ." The Board
notes further that petitioner's collective bargaining agreement
with the Laborers, while not applicable to Murray County, also
applies to both highway work and dam work. There is no evidence in
the record that either of these agreements have, in fact, ever been
used either in Murray or the adjacent counties. The agreed upon
rates if the contractor agrees to abide thereby are substantially
higher than the wage predeterminations here.
3. Prevailing Rates. The Solicitor has found the prevailing
rates for like work in Murray County to be those paid at Carters
during the last six weeks of work on Phase I which was completed in
late December, 1964. While the petitioner argues that the area to
be considered is a multi-county area and that similar work is not
limited to dams, petitioner specifically requests this Board to
find the prevailing rates to be those in effect on Carters Dam
during the peak of employment, which was prior to November 15. It
is clear that the rates requested by petitioner are higher than
those paid on Interstate Highway and soil [8]
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[9] conservation work in the adjacent counties.
The record contains a request by the Operating Engineers that
the rates in its agreement with petitioner should be determined as
prevailing and other interested persons have argued in the record
that other dam work, again with substantially higher rates, should
be considered. It seems clear, however, that the AGC-Operating
Engineers agreement, as indicated above, has never been used in
Murray or the adjacent counties and cannot be considered to
establish prevailing rates in these counties. It seems clear also
that the other dam work referred to is located beyond the limits of
those counties and in some cases in another state.
2. CONCLUSIONS
The petitioner, the Georgia Branch Associated General
Contractors of America, is an appropriate party to file a petition.
The Solicitor is a necessary party.
The Corps of Engineers, upon learning of the filing of the
petition in this case, postponed the opening of bids on the
proposed contract work originally set for February 10, 1965, until
March 10, 1965 at the request of the petitioner. The WAB does not
request contracting agencies to postpone bid opening dates.
We have noted under "Procedural Comments" the procedural
inadequacies which have brought this matter before the Board with
no clear definition of the issues or what relief the petitioner
seeks from the Board. As indicated above, the petitioner and other
interested persons have raised a number of relevant questions
concerning (1) the area to be considered for making the
computation, (2) whether projects of a character similar in the
appropriate area should have been considered, (3) the
"representative period" of current wage rate information, and (4)
whatever else the petitioner may have taken up with the Solicitor
by way of exceptions [9]
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[10] to the initial ruling. The issue
before the Board, and the one upon which the final exception to the
Solicitor's decision and appeal is apparently taken is that the
Solicitor should have used a different "representative period" for
determining the current wage rates on Phase I, than the period he
did use, but that he was justified in limiting the "projects of a
character similar" to be considered to Carters Dam, Phase I. We
reach this conclusion, because, although much was said about other
possibilities and combinations of criteria and standards for
determining the wage rates on Phase II, the petitioner's position
is that the rates that should have been determined in AD-9,787 are
the "old" Phase I rates; that is, the rates prevailing on Phase I,
Carters Dam, before November 15, 1964, and not the "new" rates;
that is, the rates prevailing after November 15, 1964, on the same
Dam. Whether the petitioner recognized that Phase I rates now
exceeded highway construction rates or believed it would not be
possible or wise to go back to a broader base than the Dam itself,
or whether for other reasons, its position in essence is that the
proper and legitimate rates that should have been found here are
the "old" rates and not the "new" rates. The petitioner does not
suggest going back to highway construction which has laborers rates
at the FLSA statutory minimum of $1.25 as compared with the "old"
rate on Phase I of $1.73.
In support of its position, the petitioner asserts that the
"new" higher rates came about because of a "spurious" situation in
that the contractor for Phase I entered into an agreement with the
Unions containing an escalation clause to become effective after or
at the very end of the estimated contract completion time. But for
a fortuitous circumstance of almost unprecedented rainfall in
October, the escalated wages would never have been paid. They
would have been paper rates only, unsupported by actual payment
evidence, and hence the "old" rates would control here.
The Solicitor's position is that the period from November 15
to December 22, 1964, after a major change in the wage rate
structure, is the period to be used in determining the current wage
rates. That even [10]
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[11] if other combinations of "areas for wage
rate computations" and other projects were taken into
consideration, the result would be the same because in any possible
combination of area and projects, there is really only one project
of a character similar to Phase II, Carters Dam, and that is Phase
I. The Solicitor says these new rates were in fact paid to 87
workers for six weeks, that this is a current wage period, and he
does not look to the contract at all -- he looks to the data
reflecting the actual payments made.
We think that the petitioner should have been more diligent in
pursuing its total position before the Solicitor, and that, in
turn, the Office of the Solicitor should have shown more concern in
explicating to the petitioner the reasoning behind its decision.
However, the contracting agency has already once delayed the bid
opening and we cannot further delay this matter.
With the sole issue of the appropriateness of the
"representative period" used to determine the current wage rate
information on Phase I, Carters Dam, for use in predetermining the
Phase II rates before it, the Board believes it is restrained by
the record and the proceedings to find that the petitioner, both in
the Solicitor's Office and before the Board, has not sustained its
assertions.
The new wage rates were in fact paid for a representative
period. For the last six weeks of this project the rates the
petitioner seeks were not the rates paid. The petitioner would ask
the Solicitor to disregard this Period and go back to an earlier
period.
The question is whether those new rates are to be disregarded
as not representative because one contractor and two unions on the
job "set up" some rates to govern future work. The new rates were
not prevailing during the bulk of the time the Phase I work was
underway or at peak employment when more employees were employed
than later. [11]
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[12] However, the difference between the peak period in mid-1964
and that after November 15, 1964, is not upon examination, too
great -- 107 to 87. On this basis, the post November 15 period
could be representative. A representative period would be one in
which there is a substantial employment sufficient to give a clear
wage rate picture. And if there is enough current activity which
is sufficiently representative to evidence such a clear picture of
the wage rates, the Solicitor should not be required to go back to
an earlier period.
One possible reason that the Georgia Branch of the Associated
General Contractors of America does not pursue the question of
treating this dam and nearby highway construction as similar is
that highway interests would undoubtedly strongly object if, in
principle, the rates on Carters Dam were now used to determine wage
rates on highways throughout the county. Normally the Davis-Bacon
Division has not used highway rates on major dam construction and
vice versa and did so in this case because the highway rates were
the only ones available initially. However, these were lower rates
than presently prevail.
The Department of Labor cannot be charged, prior to the Phase
II rates, with the increases which have occurred. Apparently
employers and organized labor themselves brought about the wage
increases which the Department of Labor subsequently recognized.
All in all, we do not believe that the Board would be justified on
this record in distinguishing what happened to wage rates during
Phase I from what other contractors had done before on the same
job.
The situation might be different if the wage rate increases
were shown to be so far out of line with outside standards as to
invite invidious comparisons. As noted, the petitioner has a
contract of its own with the operating engineers by which an
employer who wishes to abide by its terms agrees to pay wage rates
on dams as well as on highways which are much higher than the Phase
II predetermination in Murray County. And [12]
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[13] while the Solicitor has rejected TVA rates for comparison, TVA
unions do make some claim of jurisdiction in Murray County. TVA wage
rates are higher than those predetermined here.
We do not believe that the petitioner has established that the
object of the escalation clause was for the purpose of making a new
and higher Davis-Bacon wage determination. Other projects could be
taken into consideration if there were any. In fact, if the
employer agreed to pay these rates on Phase II if awarded the
contract, but did not intend to pay them on Phase I, he would
probably have effectively taken himself out of the bidding on Phase
II if the agreement was to be lived up to.
In this case we do not believe we can disregard the new
payroll data and go back to the old.
ORDER
The petitioner's request that the Phase I rates on Carters Dam
which were in effect prior to November 15, 1964, but not after that
time be put into effect on Phase II is denied.
Dated at Washington, D.C.,
this 1st day of March 1965
Oscar S. Smith, Chairman
Stuart Rothman, Member
Clarence D. Barker, Member
WAGE APPEALS BOARD [13]
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