CCASE:
J. SLOTNIK
DDATE:
19820322
TTEXT:
~1
[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D. C.
In the Matter of
J. SLOTNIK COMPANY, WAB Case No. 80-05
Prime Contractor
VERMONT HEATING AND Dated: March 22, 1983
VENTILATING COMPANY,
Sub-subcontractor
HEW Project ME-82, H.A.D. #4, the
Regional Medical Facility, Dover-
Foxcroft, ME
APPEARANCES: John B. Barton, Esquire for J. Slotnik & Vermont
Heating and Ventilating Co.
Douglas J. Davidson, Esquire for the Wage and Hour
Division, U.S. Department of Labor
Terry R. Yellig, Esquire for Building and
Construction Trades Department, AFL-CIO
BEFORE: Stuart Rothman, Chairman, Thomas X. Dunn, Member
Gresham C. Smith, Alternate Member /FN1/
DECISION OF THE WAGE APPEALS BOARD
This case is before the Wage Appeals Board on the decision of
the Administrator, Wage and Hour Division, dated February 1,
1982 /FN2/[1]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN1/ Board Chairman Alvin Bramow withdrew from consideration of
this appeal prior to the hearing and did not participate in the
hearing.
/FN2/ The Solicitor's Office filed this appeal at the request of
the Deputy Under Secretary for Employment Standards because of an
apparent conflict in the decisions of the Administrator, Wage
and Hour Division. [1]
~2
[2] in the above-captioned matter. The Administrator reversed in
part and affirmed in part a decision by an Administrative Law Judge
(hereinafter ALJ) following a 29 CFR [sec] 5.11(b) hearing in
December, 1980. The hearing concerned alleged violations of the
Davis-Bacon provisions of the Hospital Survey and Construction Act,
as amended by the Hospital Facilities Amendments of 1964, 42 U.S.C.
[sec] 291e(a)(5) (hereinafter the Hill-Burton Act), the Contract
Work Hours and Safety Standards Act, 40 U.S.C. [sec] 327, et seq.
(hereinafter CWHSSA) and the regulations promulgated thereunder, by
Vermont Heating and Ventilating Company, a sheet metal
sub-contractor, (hereinafter Vermont Heating) in the construction
of a hospital at Dover-Foxcroft, Maine.
The facts leading to this appeal are undisputed. Beginning
in the fall of 1976, Vermont Heating was involved in the
construction of the aforementioned hospital. The project lasted
about one year. Vermont Heating utilized 20 employees of which 13
were apprentices and 7 were journeymen. Fifteen of these employees
lived in Vermont, about 300 miles away. These employees traveled
to the worksite each Sunday and usually worked a four day week of
10 to 12 hour days. Vermont Heating paid its employees only their
straight time rate for hours worked in excess of 8 hours per day.
None of the employees worked over 40 hours per week. The company
made payments, called "remote job adjustments" to these employees
based on the distance of the project from home. The company also
paid the living costs at the jobsite and for those meals eaten away
from home.
After its investigation, Wage and Hour notified Vermont
Heating that: (1) it failed to employ the sheet metal apprentices
in the proper ratio of apprentices to journeymen, (2) it failed
to [2]
~3
[3] pay its apprentices the applicable percentage of the
journeyman's wage rate, and (3) it failed to pay either journeymen
or apprentices time and one-half for hours worked in excess of 8
hours per day. Ultimately, back wages in the amount of $11,500.53
were found due, of which $6,731.48 is alleged to be due apprentices
for violations of the Hill-Burton Act, and $4,768.85 is alleged
due journeymen and apprentices for CWHSSA overtime violations.
Pursuant to Regulations, 29 C.F.R. [sec] 5.11(b) the petitioner
requested an ALJ hearing to review Wage and Hour's assessment of
back wages.
The ALJ hearing was held in December, 1980. In July, 1981
the ALJ issued his decision. In his decision the ALJ determined
that the Wage and Hour Division's action was barred by the Portal-
to-Portal Act's statute of limitations provision, 29 U.S.C. [sec]
255(a), and by laches. Nevertheless, in the interest of fairness
and to avoid any further delay the ALJ ruled on the remaining
issues. (Admr's Dec., p. 2). In his decision the ALJ ruled that
Vermont Heating was contractually subject to the Davis-Bacon Act
requirements and to CWHSSA, that the apprentice/journeyman ratios
from Vermont Heating's apprenticeship program registered with the
Maine State Apprenticeship Council applied to the project because
the hospital construction was located in Maine, that Vermont
Heating failed to use the appropriate apprentice/journeyman ratios,
that the "remote job" adjustment paid by Vermont Heating could be
credited towards satisfaction of its Davis-Bacon obligations,
and that the employees could not voluntarily waive their rights
to overtime compensation under CWHSSA. [3]
~4
[4] Counsel for Vermont Heating had filed a prior Petition for
Review with the Board on April 7, 1980, which the Board docketed
for record purposes but did not process because the Wage and
Hour Division had not yet issued a final decision as required
by the Board's regulations.
In August, 1981, the Solicitor of Labor asked the Wage and
Hour Administrator to review the ALJ's decision. In February,
1982, the Administrator affirmed that part of the ALJ's decision
which held that Wage and Hour's action was barred due to the
statute of limitations provision in the Portal-to-Portal Act, and
that the ALJ had erred on the laches issue. He affirmed the
application of the Maine apprentice/journeyman ratios but concluded
that the "remote job" adjustment payments were reimbursed travel
expenses which should not be credited toward the wages required to
be paid.
The Solicitor's motion for reconsideration of the
Administrator's decision on the issue of the statute of limitations
was denied in April, 1982. Thereupon, the Solicitor filed an
appeal with the Wage Appeals Board on July 1, 1982.
After the office of the Solicitor filed its appeal to this
Board in July, 1982, Vermont Heating filed a reply to the
Solicitor's petition. Vermont Heating also filed a cross-petition
to challenge certain findings in the Administrator's decision.
The Solicitor's appeal to the Board is limited solely to
the applicability of the Portal-to-Portal Act's statute of
limitations to ALJ proceedings brought under the Hill-Burton Act &
CWHSSA. Vermont Heating's petition asks the Board to find that [4]
~5
[5] the ALJ's decision concerning his ruling on the Portal-to-
Portal Act was correct. The petition seeks other relief as is
proper.
Vermont Heating argues to the Board that although the
Portal-to-Portal Act specifies only the Walsh-Healey Public
Contracts Act, the Fair Labor Standards Act and the Davis-Bacon
Act as being subject to its provisions, the statute of limitations
provisions must also apply to the so called Davis-Bacon "related
acts", such as the one here, the Hill-Burton Act, which provide
that predetermined wage rates will be determined in accordance
with the Davis-Bacon Act requirements. It is also argued that the
Davis-Bacon Act enforcement procedures are incorporated in the
Hill-Burton Act. For this reason Vermont Heating would apply
the Portal-to-Portal Act provisions to the "related acts" also.
In addition Vermont Heating contends that very few Davis-Bacon
cases result in judicial review. Any review they receive is as
a result of administrative proceedings. Therefore, Vermont Heating
argues, the Portal-to-Portal Act's statute of limitations should
also apply to the initiation of proceedings before an ALJ, that
is, the order of reference. It is urged that the statute of
limitations should be applied in the same way that is applied
to the filing of a complaint, which, if it is filed within two
years, stays the statute of limitations in a judicial appeal.
The Solicitor's position is that the statute of limitations
provision of the Portal-to-Portal Act should be limited only to
the acts specified in the statute. The provision, the Solicitor
asserts, does not apply in this instance because the alleged
violations arise under the Hill-Burton Act and CWHSSA. The [5]
~6
[6] Solicitor disputes Vermont Heating's interpretation that the
"related acts" incorporate by reference the Davis-Bacon Act
and its enforcement procedures. The Solicitor also argues
that the statute of limitations provision of the Portal-to-
Portal Act is inapplicable to the act of withholding sums of
money or to other administrative proceedings. The Supreme
Court in Unexcelled Chemical Corporation v U.S., 345 U.S. 59
(1953) is cited in support of this position.
* * *
The Board consolidated this case for hearing purposes only
with Glenn Electric Company, Inc., WAB Case No. 79-21, pursuant to
Regulations, 29 CFR [sec] 7.13 because the Board found that the
issue of the statute of limitations contained in the Portal-to-
Portal Act was closely related in the two cases. The Board is
issuing separate decisions for each petitioner.
The Board considered this appeal on the basis of the
Solicitor's Petition for Review, the Solicitor's reply to
Petitioner Vermont Heating's Petition for Review and the
Solicitor's Supplemental Statement, Vermont Heating's Petitions
for Review and Reply Statement, a brief from the Building Trades
Department, AFL-CIO, the record of the case before the Wage and
Hour Division filed by the Solicitor of Labor and [a] hearing
before this Board held on December 15, 1982, at which interested
persons participated. [6]
~7
[7] The Wage Appeals Board views an ALJ's proceeding actually
as a continuation of the investigative or fact finding process
of the administrative procedure. The Board does not see the
ALJ's hearing as a conventional judicial procedure to which
the Portal-to-Portal Act was intended to apply. Vermont Heating's
arguments concerning the applicability of the statute of
limitations of the Portal-to-Portal Act to an ALJ's hearing
concerning alleged labor standards violations of the Hill-Burton
Act has no parallel or precedent where judicial time limitations
have been applied to administrative proceedings. The Board has
been shown no such authoritative precedents whether in the
administration of the Davis-Bacon Act or the other Acts. The Board
will not supply such a policy in the administration of the
Davis-Bacon Act but will seek to prohibit the abuse of delay in
other ways.
The Board is aware that excessive delays in processing
Davis-Bacon appeals may impugn the fairness of such proceedings
in appearance or in fact. The Board sees itself as a ready and
available means to prevent excessive delays by timely action. But
it is not within its power to hold that the provisions of the
Portal-to-Portal Act will cover an administrative activity of this
nature. The Congress has not expressed or implied such an intent.
The Board will follow the guidance of the Supreme Court in
Unexcelled Chemical Corporation v. U.S., supra, and by the court in
Ready-Mix Concrete Co. v. U.S., 130 F. Supp. 390 (1955) insofar as
the disposition of the instant petition is concerned because no
persuasive reason has been shown why the Board should require that
the statutory provisions of the Portal-to-Portal Act applicable
only to judicial proceedings should be applied [7]
~8
[8] as a Congressional direction to investigative and other
administrative processes under the Davis-Bacon and related acts.
The Board reverses the [A]dministrator's decision of February 1, 1982,
insofar as the [A]dministrator reached [the] following conclusions:
The Judge did not err as a matter of law in
concluding that the Government is barred from
bringing this action by the statute of limitations.
The issue is moot whether the Judge erred in
concluding that the "remote job" adjustment
payments made by Vermont Heating to its
employees could be credited towards the
discharge of its required obligations.
The issue is moot whether the Judge erred in
his computations of the appropriate journeyman/
apprentice ratios in any given day.
Nor will the Board under the circumstances of this case
put into effect an equivalency doctrine that the two year
period of limitations (in the Portal-to-Portal Act) between
the time when the cause of action accrues and the filing of
the complaint will be applied, as a matter of parallel policy,
as the time within which a Davis-Bacon Act enforcement policy
must be started before an Administrative Law Judge.
In this case, the total elapsed time from the time the
violations began until the Order of Reference was filed was
nearly 4 years. In the absence of a clear showing of sufficient
injury or disadvantage caused by the delay, we believe it
inappropriate to invoke a laches doctrine here. However, the
Board would like to put the Department of Labor's administrative
and [8]
~9
[9] legal arms on notice that extreme delay in particular
cases may create presumptions of improper treatment with or without
the showing of palpable injury to the contractor under
investigation. While it is fair to say that the consequences of
the government's delays in processing appeals should not be placed
upon employees because it may turn out that they have been wronged,
the Board sees that a balance can be reached where it becomes
equally unfair to pursue a contractor after many years of
inexcusable delay in cases in which it may turn out that employees
have not been wronged. The solution is simply for the
investigative arm of the administering agencies to go about their
business expeditiously.
In view of these considerations, the petition of the Solicitor
of Labor is granted and the cross-petition of Vermont Heating is
hereby denied. The back wages due the employees of Vermont Heating
for underpayment of wages and overtime violations should be
dis[bu]rsed to these employees.
BY ORDER OF THE BOARD
Craig Bulger,
Executive Secretary
Wage Appeals Board
