CCASE:
INDEPENDENT TRUCKING CONTRACTOR
DDATE:
19750721
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
Independent Trucking Contractor, WAGE APPEALS BOARD
Federal Highway Act Projects
I-64-3 (35) 103 and I-64-4(37)110, CASE NO. 75-03
Harrison and Floyd Counties, IN
Wage Determination No. AP-21 Dated: July 21, 1975
Big Six, Inc.
Petitioner
Appearances:
Edward Glassock, Esq.
Brown, Todd and Heyburn
Sixteenth Floor
Citizens Plaza
Louisville, Kentucky 40404
For Petitioner
George E. Rivers
Counsel for Contract Labor Standards
For Employment Standards Administration
U.S. Department of Labor
Mr. Thomas X. Dunn, Esquire
Sherman, Dunn, Cohen and Leifer
1125 15th Street, N.W.
Suite 801
Washington, D.C 20005
For Building and Construction Trades
Department, AFL-CIO [1]
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[2] Mr. Brian R. Williford
Assistant Chief Counsel for General Law
Federal Highway Administration
Washington, D.C. 20590
Mr. Thomas Owens
International Brotherhood of Teamsters
25 Louisiana Avenue, N.W.
Washington, D.C. 20005
BEFORE: Oscar S. Smith, Chairman, Wage Appeals Board and
Stuart Rothman and Clarence D. Barker, Members
DECISION OF THE BOARD
Big Six, Inc., petitioner, is an independent-trucking
contractor which had a contract under Ralph Rogers & Company, Inc.,
(herein Ralph Rogers) a party to the joint venture of Denton
Construction Company and Ralph Rogers for Indiana State Highway
Commission Projects I-64-3 (35) 103 and (37) 110 (Contract R 9219).
Petitioner requests review of the January 10, 1975, decision the
Assistant Administrator Employment Standards Administration, U.S.
Department of Labor (herein ESA) holding that truck drivers who
hauled bituminous mix from a bituminous mix plant at an established
commercial quarry to the location of the two highway projects were
covered by the Davis-[2]
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[3] Bacon Act provisions of the Federal Aid Highway Act, as amended,
(23 U.S.C. 113).
The two projects, awarded in November 1972 and requiring the
paving of 12.9 miles of pre-graded highway on Interstate 64, were
completed in December 1973. The prime contracts contained the
prescribed labor standards provisions and the applicable
Davis-Bacon Act wage predetermination, No. AP-21, for Harrison and
Floyd counties, Indiana.
Ralph Rogers, one of the two members of the joint venture, is
an established operator of "hot mix" bituminous batching plants in
Indiana and also commercial quarries. It has established plants in
the Bloomington, Bedford and Evansville areas of Indiana. Ralph
Rogers is also an established highway and paving contractor, often
fulfilling its paving contract obligations by a combination of its
commercial and construction operations.
In the case of these two highway projects, Ralph Rogers
separate from the joint venture, purchased rock aggregate for the
required bituminous mix at a quarry known as the Bachman quarry,
located about one half mile from the highway site. There Ralph
Rogers set up a bituminous batching plant. The Bachman quarry is
owned by a [3]
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[4] commercial operator, Corydon Crushed Stone & Lime Company, Inc.,
(herein Corydon).
The undertaking to supply the bituminous "hot mix," so far as
this Board can ascertain, was by Ralph Rogers separate from the
joint venture. Ralph Rogers was, therefore, either a
"subcontractor" or a "materialman" to the prime contractors, the
joint venture, depending on the Board's decision in this
matter./FN1/ The petitioner was hired by Ralph Rogers to haul the
bituminous mix from the batching plant to the construction project
sites only. It did no other work. Ralph Rogers, for whatever
reason, paid the project Davis-Bacon wage rates to its employees
at the Corydon location. Big Six, the independent trucking
contractor did not. We are told practically nothing about the
legal arrangements between Ralph Rogers and Corydon.
Petitioner has been unable to make showing that Ralph Rogers
has made commercial sales from the Corydon [4]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN1/ Neither Ralph Rogers nor the joint venture has joined in
this petition, leaving Big Six, Inc. pretty much on its own. The
Ralph Rogers "hot mix" batching plant at the Corydon location was
built shortly before the start of construction work on the two
projects but after contract award. It was constructed on
substantial concrete foundations lending some support to
petitioner's contention that Ralph Rogers intended from the
beginning to be permanently located at Corydon. [4]
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[5] location. The Board concludes that at least up to October 23,
1974, almost a year after completion of the two projects, it had
not. If Ralph Rogers has had a longer range intention to make
commercial sales to the general public and if such longer range
intention were pertinent under the circumstances, the Board would
not know what that intention was.
Under these circumstances, the Indiana State Highway
Commission notified Ralph Rogers in August 1973, that the
Davis-Bacon Act labor standards applied to Big Six, Inc.'s
employees hauling-the hot mix to the highway locations. This
position was reaffirmed by the Federal Highway Administration in
November 1973; to wit, regardless of Ralph Rogers' status as a
commercial operator elsewhere, its Bachman quarry plant was
specifically set up to serve the needs of the highway contracts; no
other sales of bituminous material had been made; Ralph Rogers was
a subcontractor; Big Six was a subcontractor to it.
In January 1975, ESA affirmed the Federal Highway
Administration, holding, as ESA states in its prehearing brief,
that when an operation of a bituminous mix plant away from the site
of the highway is part of the construction activity contemplated by
the highway projects, [5]
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[6] it is integrally connected with the construction activity and its
employees are clearly protected by the Davis-Bacon Act requirements.
What is not answered by this kind of statement is the
question: -- when is an operation of a bituminous mix plant located
a distance from the site of the highway itself a part of the
construction activity contemplated by the highway projects and when
is it not so contemplated. That question is what brings this case
before the Board for review.
The basic issue in this case is: what is there in the facts
and circumstances surrounding the work in dispute and the
transaction between Big Six, Inc., and Ralph Rogers that points to
whether the employees of Big Six, Inc., should be excluded from or
included within the prevailing wage protections of the Davis-Bacon
Act? Whether this particular batching plant is covered or not
covered by the Davis-Bacon Act depends upon a close scrutiny of
the facts surrounding its establishment and its operation.
In approaching this question, "the first question that
arises," the Board is told by ESA, "is whether, for purposes of
coverage by the Davis-Bacon Act, Ralph Rogers and [6]
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[7] Company, Inc., operated as a subcontractor or a materialman in its
performance as a supplier of bituminous material to the two subject
projects." But is this not a conclusion in these "on site" "off
site" cases, and which unless the nebulous nature of these terms
are better understood lose their usefulness as analytical tools and
can become the rationalization for including or excluding
particular employees from protection. If the conclusion reached
after an examination of the circumstances is that the particular
work should be covered within the policies of the Davis-Bacon Act,
the work is said to be subcontracted work. If the conclusion
reached is that the policies of the Act do not require protection
of certain employees, it is said that the employer is a
materialman. It may, therefore, properly be asked: -- are not such
labels often conclusionary?
When Big Six's alleged predicament is looked at from its own
point of view, the situation takes on the following aspects. Big
Six took a job of moving construction materials from the site of an
established commercial quarry to the location of two highway
projects. As a local trucking contractor, Big Six would be familiar
with Corydon's operations. Would it not look to Big Six like [7]
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[8] there was no difference between moving hot mix from the
location of an established commercial quarry and moving stone
aggregate alone for Corydon to the site or for that matter moving
hot mix from one of Ralph Rogers other batching plants to the
highway locations.
Had Ralph Rogers decided to put its batching plant at the two
highway project locations, Big Six may have been called upon to
transport the stone aggregate alone from Corydon to the two
locations. Or for that matter, had Ralph Rogers, after erecting
the bituminous batching plant at the Corydon site leased it to
Corydon to be used as part of Corydon's commercial operations, the
line between so called "subcontractor" and so called "materialman"
would have been nebulous indeed if not totally obscured or erased.
If Ralph Rogers told Big Six what Big Six is now telling the
Board; namely, the Corydon installation was to become a permanent
addition at the Bachman quarry and Ralph Rogers was going to make
substantial commercial sales right away, there would be additional
reasons why Big Six should contend before the Board that the work
in question looked to it to be the same as the Corydon operations.
From such vantage point, Big Six's situation [8]
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[9] would appear to deserve a sympathetic approach with some kind of
forgiveness for a stricter application of the Davis-Bacon Act if that
were possible under all total circumstances.
But such an approach would suffer from two unfortunate
weaknesses; (1) Big Six, normally can stand in no better position
before the Board than the contractor from which it took its work
and its responsibilities; (2) Big Six's contentions fall for lack
of proof that it is in a different than normal situation in
batching plant cases.
If there is anything in the local situation and the
relationship between Big Six and Ralph Rogers that raises questions
of private contract law, such questions are beyond the reach of
this Board. The joint venture of Ralph Rogers and Denton
Construction Company had several options open to it. In the
absence of a nearby establis[h]ed commercial bituminous batching
plant, or one with which the joint venture would deal, the joint
venture chose to have the work done by one of its parts, Ralph
Rogers. /FN2/ Ralph [9]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN2/ Ralph Rogers also performed construction work at the highway
locations. It is fair to take for granted that Ralph Rogers was a
member of the joint venture because of its bituminous batching
plant experience and operations. [9]
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[10] Rogers could have erected the batching plant where the highway
was. It could put it at Corydon. It could put i[t] elsewhere.
Such a batching plant, put in in consequence of these two highway
projects must be considered in the nature of construction within
the construction industry and not in the nature of a commercial
operation.
In the case of batching plants, this principle of Davis-Bacon
Act coverage and enforcement is beyond cavil.
The fact that Ralph Rogers decided to put the bituminous
batching plant where its supply of quarry aggregate was is not a
pivotal factor in this case. If it was misleading to Big Six, that
is a matter between Big Six and Ralph Rogers, but it would not take
it out of the basic policies of Davis-Bacon Act enforcement. The
reason for this is that had the joint venture, or Ralph Rogers
alone, moved the mix from the batching plant to the highway
locations with its own employees, it is plainly clear that the
employees doing this work would be employees of these contractors
directly engaged upon the site of the work and subject to the Act.
Ralph Rogers or the joint venture cannot under the circumstances
relieve themselves of their own Davis-Bacon Act obligations by
giving the transportation work to Big Six. It is of some
significance that [10]
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[11] neither are trying to do so in this proce[e]ding.
Although Big Six may look at this matter as one in which it
paid its employees or independent contractors the same rates it had
always paid them to do identical work, it is the nature and purpose
of the Act to require contractors, and those who take a part of
their obligation from them, to pay not less than the prevailing
wage rates as predetermined by ESA for work they would have to do
themselves to fulfill their contract obligations. It is for this
reason, the Board believes that in the case of an established
commercial batching plant, it is not expected when work is awarded
that the prime contractor will do the work to provide the material
that normally come from such sources. It is for this reason, too,
the established commercial quarry or batching plant is said to be
a "materialman." In such cases the established commercial operator
continues to do its own thing in its own same way at the same
place. But where the prime contractor must do the work with his
own forces because no commercial operator is established and ready
to perform, another contractor who takes on a part of the
contractor's obligation to do this becomes subject to the Davis-
Bacon Act in the same way. [11]
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[12] And so it is in this case that Ralph Rogers, despite Big
Six's contention, did not become a commercial operator from the
moment it erected the bituminous plant simply because it is or has
been a commercial operator of batching plants elsewhere. The facts
and circumstances in this situation do not sustain such a position.
This is bolstered by the fact that Ralph Rogers did no substantial
commercial work during the performance of the two contracts in
question and makes no such claim here.
The petition is dismissed.
SO ORDERED:
(s) Oscar S. Smith, Chairman
(s) Stuart Rothman, Member
(s) Clarence D. Barker, Member [12]
