CCASE:
Abreen Corporation V. REDDEN GARDENS
DDATE:
19760630
TTEXT:
~1
[1] UNITED STATES OF AMERICA
DEPARTMENT OF LABOR
DECISION AND ORDERS OF THE WAGE APPEALS BOARD
IN THE MATTER OF
REDDEN GARDENS WAB Case No. 76-03
HUD Project No.
024-44016-LDP/SUP, Dover, N.H. DATE: June 30, 1976
DECISION AND ORDER
APPEARANCES:
Ronald Robins, Esq.
George E. Rivers, Esq.
Office of the Solicitor
For: U.S. Department of Labor
Richard Gleason, Esq.
Stoneman, Chandler & Miller
For: Petitioner
Steven Horowitz, Esq.
Office of General Counsel
For: Department of Housing and
Urban Development
BEFORE: Oscar Smith, Chairman and Clarence Barker, Member [1]
~2
[2] This case is before the Board on the petition of Abreen
Corporation, the general contractor, to review a determination of
the Assistant Administrator of the Wage and Hour Division that
three employees were underpaid a total of $1,044.57 while employed
to construct the Redden Gardens Apartment project in Dover, New
Hampshire, a project financed under section 236 of the National
Housing Act. A project wage determination of the Secretary of
Labor (72-NH-115, dated August 30, 1972) was applied to the above
construction.
Abreen Corporation employed Ronald Jacobs as its supervisor
for the construction of building foundations. Jacobs had
previously been a contractor on other construction work do business
as R. J. Construction Company. On some of this work, unrelated to
Abreen or to Redden Gardens, Jacobs had encountered financial
difficulties including allegations that he failed to meet payrolls.
Among those who allegedly were not fully compensated are three
employees who worked under Jacob's supervision on the Redden job
between October 1972 and January 1973. [2]
~3
[3] The Department of Labor, Wage and Hour Division, conducted
an investigation in 1973 in the course of which it obtained
Employee Interview Statements from the three employees (Leon
Bushey, Charles Lockhart and Earle Riley). The headings of the
statements name only R. J. Construction as their employer. In
essence, each statement alleges wage underpayments or no payments
for work performed on various private work, including a Parker
Motors job and, in the case of Bushey and Riley, on a "HUD job in
Portsmouth" as well as the Abreen job. In their statements Bushey
and Lockhart allege they spent 75 percent of their time on the
Redden Gardens project performing work described as "building
frames of plywood in which to pour cement for foundation" and as
"setting up forms; that is, nailing boards (4 x 8 plywood and 2 x
3 studding) together". Riley states he spent 120 hours on the
Redden Gardens project "as a cement finisher and the rest of his
time "setting up forms". Three other employees who had earlier
been employed by R. J. Construction are also alleged by Riley to
have been underpaid by Abreen two of them allegedly having "spent
all their time as carpenters and got laborers rates". [3]
~4
[4] Based on the information thus obtained the Wage and Hour
Division determined that three employees of R. J.
Construction,/FN1/ who were paid at the prevailing rate for
laborers, yet spent the majority of their time performing
duties which should have been classified as carpentry work, and
that one of these individuals, Earle Riley, also spent part of his
time performing duties which should have been classified as cement
mason's work.
By letter dated March 29, 1973, Abreen Corporation was
notified by HUD that because of wage underpayments to three unnamed
employees due to misclassification and a check in the amount of
$1,100 was due to HUD. No information was furnished to show how
the calculation of back pay was made.
Abreen responded that it was unaware of any misclassification
and requested specific information to support the allegation. A
meeting was held in September 1973 between a HUD representative and
Mr. Barnard Shriber of Abreen. Abreen was given the names of
Riley, Lockhart and Bushey and a final determination of the amounts
due each man.
Supplemented by information in Abreen's certified payrolls,
the Wage and Hour Compliance Officer determined [4]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN1/ At the hearing Counsel for the Labor Department stated that
the Department had proceeded on the assumption these men were
employees of R. J. Construction. [4]
~5
[5] that Leon Bushey spent 80 percent of his time performing
carpentry work for which he should have been paid $6.66 an hour for
the 549 hours of employment on the jobsite (between October 17,
1972 and January 23, 1973) for which back wages of $443.39 were
due. It was also determined that Charles Lockhart spent 80 percent
of his time performing carpentry work for which he should have been
paid $6.66 per hour and for the 360 hours of employment on the
jobsite (between October 17, 1972 and December 19, 1972) and was
due back wages of $290.88. /FN2/ Earle Riley spent 110 hours or
38.6 percent of his time performing carpentry work for which he
should have been paid $6.66 per hour and 120 hours or 42.1 percent
of his time performing cement masonry work for which he should have
been paid $7.26 per hour and, therefore, was due $310.30 for the
284-1/2 hours of employment on the jobsite (between October 17,
1972 and December 12, 1972).
Following this meeting Mr. Shriber repeatedly requested copies
of any evidence of misclassification beyond the names of the three
employees and the amounts allegedly due them [5]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN2/ During the investigation, it was determined that a figure of
80 percent would be used to establish the amount of time that Mr.
Bushey and Mr. Lockhart performed a carpenter's duties. The
Wage-Hour Division feels justified in doing this by the
employees['] interview statements. [5]
~6
[6] Specifically Abreen Corporation requested:
1. The date(s) on which the alleged violations occurred;
2. The number of hours worked on these dates by each
employee when his work was misclassified;
3. A description of the work performed which was
allegedly misclassified.
No reply was made to Abreen's request. Abreen then submitted
affidavits from its Job Superintendent and Carpenter Foreman which
stated that these employees were not misclassified. Mr. Creeley
Buchanan, Area Director of the Manchester, New Hampshire, HUD
Insuring Office, informed Abreen in February 1974 of the final
award from the Department of Labor on its investigation. He
requested a resolution of the matter at the earliest possible
date.
In response Abreen renewed its unanswered requests for
supporting data and restated that it knew of no underpayments.
Abreen also stated its desire to appeal the decision that $1,100
was owing three of its employees.
At final endorsement of the Redden Gardens project on
September 20, 1974, a Deposit of Funds Agreement was [6]
~7
[7] executed, and a certified check was requested by HUD for $1,044.57.
A formal appeal was delivered to HUD by Shriber on behalf of
Abreen, along with the certified check for this amount. Abreen's
appeal was renewed several times in the next nine months.
In late April 1975 Abreen was informed by telephone that its
appeal was denied because the amount of money in dispute was not
large enough to warrant a hearing pursuant to 29 CFR [sec] 5.11(b).
When the hearing was held before this Board on March 31, 1976
the Wage and Hour Division submitted copies of the three Personal
Interview Statements executed by Riley, Lockhart and Bushey. No
other investigation report was submitted and the board was advised
that none exists. Accordingly, it appears the available evidence
in support of the allegations of underpayments only by Abreen
consists of these three statements.
Nevertheless, these Personal Interview Statements clearly
raise que[s]tions of classification. The "building of plywood
frames in which to pour cement for foundation" almost surely
suggests the need for employment of carpenters at carpenter rates.
The description of the work, although somewhat imprecise and not in
ordinary construction [7]
~8
[8] language, is adequate to support the inauguration of an
investigation, although there appears to be some conflict between the
Riley statement and that of Bushey in respect to who tended the
carpenters.
Prior to the hearing, Abreen provided the supervisory
affidavits noted above and filed certified payroll records as
required. But in general it responded to the underpayment
allegations and findings of Wage and Hour Division by merely
reiterating its requests for detailed information. The supervisory
affidavits contained no description of the work performed but only
that it was work customarily performed by laborers.
While we agree that certain information should have been
provided to Abreen by Wage and Hour Division (e.g., a description
of the work alleged to have been misclassified) we think Abreen may
have misunderstood its own obligations. A contractor, if called
upon to do so, is expected to provide data and other information in
support of its wage payment and classification actions. In many
cases this obligation is satisfied by submission of the certified
payroll records. However, such records go to rates and total
payments. Classification actions, if challenged, may require
further factual support. It is not sufficient for the contractor
to simply shrug his shoulders and say that [8]
~9
[9] the work performed by his employees is customarily done by
workers classified as he indicated in his certified payroll
records.
In the instant case we think that from time to time Abreen was
given the names of the three employees allegedly owed money because
of their misclassification. Abreen was in a position to narrow the
issue and was obligated to either accede or join the issue of
whether these employees actually performed the work of carpenters
and cement masons at its jobsite. As to the six employees who had
formerly worked for R. J. Construction, it could have, and should
have, responded with a description of what the Jacobs crew did when
it worked for Abreen, its composition, how it was organized, how
work assignments were made within the crew, what kinds of forms
were used on the work, how they were erected and by whom and if
cement finishing work was involved what this work was and who
performed the work.
While we would have expected the Wage and Hour Division to ask
these kinds of questions and report on them, any failure on their
part to do this does not excuse Abreen from making a full, complete
and candid report explaining the actions which had been questioned.
We think Abreen [9]
~10
[10] knew which of its assignments were in question because it was told
that the amounts due were the difference between carpenters or cement
finishers rates and laborers rates. Each party had an obligation to
tell the other about the work in dispute. The objective must be to
develop the full facts, not to exchange conclusionary allegations and to
rely on technical questions of where the information burden rests.
Petitioner asks that funds presently in escrow be returned to
it or that, in the a[lt]ernative, the matter be remanded for
consideration de novo. The work was performed in 1972 and no
investigation file exists except for the statements of the three
employees. These statements provide an incomplete description of
the work allegedly performed and are somewhat confusing because of
claims relating to another HUD job in Portsmouth and a Parker
Motors job, as well as other private work not involving Abreen.
However, the statements do set forth that these three
employees and others built forms while being paid as laborers and
we regard the erection of wall forms, including but not limited to,
placement, alignment, plumbing, leveling [10]
~11
[11] bracing and fastening as work normally calling for a
carpenter's rate.
The Board is not satisfied with the way either the Department
of Labor or the Petitioner has handled the matter thus far.
Petitioner has claimed with some justification that, at least at
the beginning, the government did not apprise it with sufficient
clarity of its alleged wrongdoing and has persistently maintained
that there has been no underpayment but it has not described the
form building operation or the work which these three employees
allegedly performed.
Although the sum is not large, if there has been a violation
of the Act and these three employees are entitled to reimbursement
of wages, the matter should be reconsidered. We have determined,
therefore, that this case should be remanded to the Administrator.
The Board requests that Petitioner promptly file with the
Administrator a full and complete report on all the jobsite work
that is brought into question by the statements of the three
employees. This report should include, along with other pertinent
material, information of the type mentioned above such as a
description of the forms used, [11]
~12
[12] the tasks involved in their use from arrival of the form materials
at jobsite to removal from jobsite, how these tasks were assigned and by
whom they were performed, etc.
The Administrator is directed to consider the Petitioner's
report along with other material in the record and thereupon
determine a course of action.
This consideration and determination should occur within
thirty days from the date of receipt by the Administrator of
Petitioner's draft.
If there is still a dispute as to the disposition of this
matter, either party can seek further review by the Board.
Accordingly, the Board will retain jurisdiction for such purposes.
In so directing the Labor Department to reconsider this
matter, the Board is not directing the Administrator to make any
particular findings or reach any particular conclusions. Rather,
it is directing all the parties to cooperate in getting a better
hold on the facts, if that is possible at this time, and to do this
without further delay. [12]
~13
[13] The Administrator may continue in his enforcement
position; he may modify it in part; he may dismiss the case on the
basis that there has been no violation, or he may decide to take a
no-enforcement position.
SO ORDERED:
s/ Oscar S. Smith, Chairman
s/ Clarence Barker, Member [13]
