Windemuller Electric, Inc., WAB No. 1975-04 (WAB July 11, 1975)
CCASE:
ST. MARY'S HOSP. V. Windemuller Electric,
DDATE:
19750711
TTEXT:
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[1] UNITED STATES DEPARTMENT OF LABOR
WAGE APPEALS BOARD
ROOM S2018
WASHINGTON, D. C.
IN THE MATTER OF
Modification #1 to Wage Decision WAGE APPEALS BOARD
AR-3054 dated September 13, 1954 CASE NO. 75-04
applicable to St. Mary's Hospital DECISION AND ORDER
in Kent County Michigan DATED: JULY 11, 1975
Windemuller Electric, Inc.
Grand Rapids, Michigan
Petitioner
Appearances:
William B. Barton, Esq.
Barton & Lambeth
725 15th Street, N.W.
Washington, D.C. 20005
For the Petitioner
George Rivers, Esq.
United States Department of Labor
For the Administrator, ESA
Thomas X. Dunn, Esq.
Sherman, Dunn, Cohen & L[ei]fer
1125 15th Street, N.W., Suite 801
Washington, D.C. 20005
For Building & Construction Trades
[1]
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[2] Appearances -- continued:
Mr. O.L. Kerth
International Brotherhood of
Electrical Workers, Room 1101
1125 15th Street, N.W.
Washington, D.C. 20005
Edward Windemuller, President
Windemuller Electric, Inc.
2449 29th Street, S.W.
Grand Rapids, Michigan 49509
John W. Doherty, Jr.
Executive Director
Associated Builders & Contractors, Inc.
32 Grandville Avenue, S.W.
Grand Rapids, Michigan 49502
BEFORE: Oscar S. Smith, Chairman, Wage Appeals Board and
Stuart Rothman and Clarence D. Barker, Members
DECISION AND ORDER
The petitioner, Windemuller Electric, Inc. an electrical
contractor engaged in electrical work on Blodgett Hospital in Kent
County, Michigan, proposes to bid upon another hospital project,
Saint Mary's Hospital, in the same county. Both projects are by
statute subject to the Davis-Bacon Act prevailing wage requirements
because of financial assistance of the Department of Health
Education and Welfare and Federal Housing Administration. [2]
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[3] The petitioner is supported in this matter by the Associated
Builders and Contractors of Michigan, Inc.
Petitioner protests the electricians' wage rate in
Modification #1 dated September 13, 1974 to Wage Decision AR-3054,
dated July 12, 1974. This modification raised the wage
determination under AR-3054 from $6.48 an hour to $8.52 an hour.
Although petitioner requests the Board to order the rate of
$8.52 "be corrected in line with the facts," it does not tell us
with sufficient clarity what the facts are which would sustain a
lower rate and it does not recommend one.
The genesis of this case is a series of oscillating wage
determinations for Kent County, Michigan, reflecting an unstable
organization of the construction industry with rates other than
negotiated rates sometimes predominating and sometimes not. This
has resulted at times in mixed rates within the same schedule and
at other times in averaged rates for a particular classification
under the Department of Labor's evaluation standards. [3]
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[4] Petitioner's protest was precipitated when the Employment
Standards Administration (herein ESA) modified the $6.48 wage rate
for electricians to $8.52 on data submitted by the electricians'
local union at Grand Rapids. The petitioner believes the practice
had developed in the earlier and closely contested surveys to
collect and analyze data in a way in which no side could claim
surprise, but in this instance the ESA failed to let petitioner
know of the local union's submission so that it could counter
with its own data.
The ESA explains that the failure to notify petitioner and his
side was just one of those oversights that occurs in conducting
government business on a large scale. But the oversight, the Labor
Department says, did not and could not have affected the result.
Moreover, the Labor Department says, when the ESA learned that it
had not contacted petitioner's side, it leaned over backwards to
have them submit whatever information they had on the propriety of
the $8.52 rate. Although petitioner's side was told such data
would be considered, no information has been forthcoming. [4]
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[5] The petitioner's position at first appears to be one of
embarrassing the ESA by making it look as though it has been
maneuvering in a tight wage situation by taking pilotage from only
one quarter. This, by itself, is a weak posture from which to
argue because the petitioner's forces were accorded an equal though
belated right to prove the decision was wrong but "elected" as they
put it, to put the whole thing before the Board.
The Board, however, discerns something of more substance in
the petitioner's contention. Here, we have a situation where the
prevailing rates for particular crafts have not followed any well
discerned and constant pattern. The prevailing rate has been found
by necessary surveys to shift from amounts reflected by negotiated
rates in the locality to other rates found to be predominating at
the time of each survey. It was shortly before the protested
September 13, 1974 modification to $8.52, that the local electrical
union succeeded in establishing with ESA by the challenged
unilateral submission that the negotiated rate for electricians had
become the prevailing rate. [5]
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[6] It was because of this preliminary determination that ESA
was led shortly to an automatic acceptance of the union's next
negotiated wage increase, which was the $8.52 rate of Modification
#1. This appears more than anything else to be the underlying
reason why the petitioner and his forces "elected" to bring this
matter before the Board.
The ESA by its counsel has made the strongest representations
to the Board that the $8.52 rate did in fact predominate under the
Labor Department's evaluation standards. Even accepting
petitioner's statements in their best light the result would come
out the same. One reason for this, ESA says, is that if the
negotiated rate of $8.52 an hour has not in fact been paid to a
majority of workers, it would have been found to apply by reason of
other tests, such as the 30 % test which is the test applied when
no other rate in fact predominates. The ESA says it did not accept
the negotiated rate because it was negotiated but because it did in
fact meet the test of the Department's regulations on the basis of
payroll evidence. [6]
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[7] In a locality where there have been gross fluctuations in
construction wage rates because of an unsettled organization of the
industry, the failure of ESA to have taken into account everybody's
submittal at the time it increased wage rates by $2.04 an hour was
an unfortunate though inadvertent error. Although petitioner has
not affirmatively shown the oversight to be prejudicial, Decision
AR-3054 issued July 12, 1974 was based on survey data comprising
local union rates effective between June 1973 and May 1974 together
with other electrician rates paid in late 1973 and early 1974.
Modification #1 took into account local union rates effective
between June 1973 and May 1974 but other electrician wage data
apparently was not updated. New local union rates became effective
in the area in June 1974 and there likely have been changes in
other electrician rates since late 1973 and early 1974. In short,
both AR-3054 and Modification #1 appear to be outdated.
In view of the background facts as developed in this record
and particularly the 1974 oversight, we believe it important that
the 1975 updating be based on a new survey that [7]
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[8] includes the electrician rates currently being paid in Kent County,
both local union work and other work. The integrity and credit[a]bility of
Davis-Bacon Act administration cannot be sustained with any less
action.
The ESA should use its normal procedures to make the survey
after checking to see whether those procedures are fair to all
under the circumstances. All interested local parties should be
kept informed of developments in connection with the survey. The
petitioner's forces should promptly submit pertinent data which
they have.
In a recent submission in another matter, one of the arguments
made was that some surveys, especially in urban areas can be
costly. In that particular case, [], Litton Bionetics, Inc.,
petitioner, the ESA had already made two surveys in the last two
years because they were necessary. It is suggested that
consideration be given to the upgrading of standards and methods of
conducting surveys in an area of statutory responsibility that
experience has shown will require an increasing amount of, not
less, explanation of governmental action substantially affecting
the public, employees, unions, contractors and owners. [8]
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[9] ORDER
It is ordered that the Department of Labor shall proceed
expeditiously with a new survey to establish the proper
electricians' current wage rate. All interested parties are
requested to cooperate. The Labor Department should try to get
this done before the award of bids for St. Mary's Hospital, Kent
County, Michigan.
SO ORDERED:
(s) Oscar S. Smith, Chairman
(s) Stuart Rothman, Member
(s) Clarence D. Barker, Member
