CTL ENGINEERING, WAB No. 80-07 (WAB July 22, 1983)
CCASE:
CTL ENGINEERING
DDATE:
19830722
TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D. C.
In the Matter of
CTL ENGINEERING WAB Case No. 80-07
Construction of Relief Well System
Clendening Dam Dated: July 22, 1983
Stillwater Creek, Ohio
APPEARANCES: William L. Farrar, Jr., Esquire For CTL Engineering
Jill A. Griffin, Esquire, Douglas J. Davidson,
Esquire for the Wage and Hour Division, U.S.
Department of Labor
BEFORE: Stuart Rothman, Acting 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 petition
of CTL Engineering (hereinafter CTL) which seeks review
ruling by the Assistant Administrator, dated February 8, 1980.
This ruling held that employees engaged in drilling pilot holes
for subsequent construction of a relief well system at the
Clendening Dam on Stillwater Creek in Ohio were subject to the
labor standards provisions of the Davis-Bacon Act and the Contract
Work Hours and Safety Standards Act (CWHSSA). [1]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN1/ Board Chairman Alvin Bramow withdrew from consideration
of this appeal prior to the hearing and did not participate in
the decision. [1]
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[2] The relief well system was required because water pressure
behind the earth-filled Clendening Dam was forcing seepage
through the dam's foundations and undermining the dam. The
relief well system proposed by the Army Corps of Engineers
would consist of twelve holes two feet in diameter and
approximately 100 feet deep. The holes would be lined with filters
to prevent sand and sediment from being forced out with the
seepage. The water rising in these holes (or wells) would
ultimately be piped safely downstream away from the dam thereby
preserving the foundations.
The contract for the relief well system was awarded to the
prime contractor, Needles and Associates, Inc., by the Corps
of Engineers. Although the specifications indicated the total
number of wells, depth of wells, spacing between the wells and
well hardware, the contract called for the drilling of a
pilot hole at each well location to further develop and refine
the design.
CTL received the subcontract to drill the pilot holes,
collect core samples, analyse the soil and the submission of
data. The labor standards provis[i]ons of the Davis-Bacon Act and
CWHSSA and the appropriate wage determinations were included in
the prime contract and CTL's subcontract.
Certified payrolls submitted by CTL to the Corps of Engineers
indicated the wages paid to C[TL]'s employees were lower than the [2]
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[3] wage rates specified in the wage determination. The Corps
of Engineers withheld the sum of $2680.25 to cover back wages
due under the Davis-Bacon Act and the underpayments and liquidated
damages due under CWHSSA.
CTL objected to the Corps of Engineer's assessment of back
wages and liquidated damages due and requested a ruling from
the Secretary of Labor. On February 8, 1980 the Assistant
Administrator, Wage and Hour Division, affirmed the contracting
officer's assessment, stating that the pilot holes were
"... directly related and incidental to, and an integral part
of the actual construction of a public work ..." CTL appealed
the ruling to the Wage Appeals Board on April 28, 1980.
CTL contends that the purpose of the pilot holes is to
obtain soil data in order to design screens and other items
to be used in the relief wells. CTL relies on an Opinion
Letter dated June 25, 1963 from Charles Donahue, Solicitor
of Labor, to Harold Blasky, Deputy General Counsel, Office
of the Chief of Engineers, which distinguishes various
examples of exploratory drilling situations, some of which
have been determined to be covered by the labor standards
provisions of the Davis-Bacon Act, and some of which are not.
CTL claims their activities are akin to the drilling example
in the Solicitor's letter where the drilling is for formulation of
engineering plans and specifications, designs and the [3]
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[4] conduct of site investigations.
Petitioner claims that the pilot holes are merely preliminary
work for the general contract to provide engineering data for the
final design of the system. Petitioner states that the timing of
the drilling, i.e.: whether before the prime contract is let, or
after, should not turn work that is not subject to the Davis-Bacon
Act and CWHSSA into covered work. It is petitioner's position that
the drilling of cores is not a covered activity whenever it is
done.
The Wage and Hour Division argues that the relief well
system is a public work within the meaning of the Davis-
Bacon Act and that the pilot holes are an essential, integral
part of the system. Wage and Hour states that the precise location
of the relief wells had been determined in advance of the pilot
hole drilling and that the core drilling samples were used to
determine the hardware to be ordered for the wells. The drilling
of the pilot holes is therefore an activity covered by the Act.
Counsel for Wage and Hour attempts to distinguish the example in
the Solicitor of Labor's Opinion Letter. It is argued that CTL's
activities are more similar to other examples listed by the
Solicitor which were ruled as covered activities in the Opinion
Letter.
Wage and Hour also asserts that the pilot holes were not
drilled prior to the development of plans for the relief well
system. Wage and Hour concedes that if this had been the case,
there could be validity to petitioner's argument against coverage. [4]
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[5] Here, however, according to Wage and Hour, the plans were
fully developed (except for certain hardware) prior to the award of
the prime contract. Wage and Hour's position is that the situation
is totally different from a situation where exploratory drilling is
performed to determine the proper location of construction and must
be undertaken before the actual plans can be drawn.
The Wage Appeals Board considered this appeal on the basis
of the petition for review filed on behalf of CTL, a statement
for the Assistant Administrator, the record of the case on file
in the Wage and Hour Division and a statement on behalf of the
Building and Construction Trades' Department. A hearing was
held before the Board on May 18, 1983 at which the parties were
present and participated.
At the hearing it was made clear to the Board that petitioner
considered the drilling of the pilot holes to be preliminary
work necessary for the development of the plans for the project.
Counsel for petitioner reduced his argument to the clear cut
position that if the drilling of pilot holes was considered
to be preliminary to the construction of the relief wells then
it should not be subject to the labor standards provisions of
the Davis Bacon Act or CWHSSA, but that if the drilling of the
pilot holes was not judged to be preliminary to the construction
of the relief wells, then it should be looked upon as covered
work. [5]
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[6] The problem in this case is not the way CTL Engineering
staffed the work according to its normal operations, but in the
way the Corps of Engineers awarded the work. It appears to the
Board that it was within the power of the Corps of Engineers,
had it elected to do so, to separately award a contract for
borings to be completed before the prime contract was awarded.
If that could have been done and had been done, a different
and stronger case could be made that the disputed work was of
a character similar to exploratory and test borings not classified
as construction.
In this case there appear to have been emergent conditions
which inclined the Corps of Engineers to move the prime contract
ahead of test borings which necessarily became auxiliary to the
main work. The two progressed together so that the subcontract
lost the characteristic of being a study of site conditions
upon which plans could be based. CTL performed its work along
side the prime contractor's construction of the relief wells,
each within a few feet of the other. The pilot holes were
in a subcontract and the results would be given to the prime
contractor to report to the Corps of Engineers under the prime
contractor's responsibility to get appropriate further direction.
These circumstances make the disputed work an essential, integral
part of the work covered by the basic award.
The subcontract contained the appropriate Davis-Bacon Act
and CWHSSA labor standards provisions without qualification. [6]
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[7] The facts disclosed that the employers in the area who perform
the kind of boring work that CTL performs use employees who may
not work at the prevailing on-site building and construction
trades' rates. Any such aspect of the case cannot be raised
here because if it were to be raised at all, it should have
been raised prior to the time of the award.
The Corps of Engineers, through careful scheduling of their
contracts, can undoubtedly avoid the problem which arose in
this case. CTL, if it does not wish to be subject to the
Davis-Bacon labor standards provisions in the future, can
likewise avoid the problem which arose at Clendening Dam by
refusing to bid on contracts for test borings where the boring
is performed as an integral and essential part of the construction
contract. But as far as this case is concerned, it cannot be
distinguished from normal work at a construction site. The work in
question should have been performed at the appropriate Davis-Bacon
prevailing rates.
In view of these considerations the decision of the Assistant
Administrator is affirmed and the petition herein is dismissed.
BY ORDER OF THE BOARD
Craig Bulger,
Executive Secretary
Wage Appeals Board
