HOWARD W. PENCE, INC., WAB No. 83-14 (WAB Sept. 4, 1984)
CCASE:
HOWARD W. PENCE, INC.
DDATE:
19840904
TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D. C.
In the Matter of
HOWARD W. PENCE, INC. WAB Case No. 83-14
Equipment Concentration Site
Maintenance Shop & Warehouse, Dated: September 4, 1984
Ft. Knox, KY, DACA31-80-C-0170
BEFORE: Alvin Bramow, Chairman, Concurring Members Stuart Rothman,
Thomas X. Dunn
DECISION OF THE WAGE APPEALS BOARD
This case is before the Wage Appeals Board on the petition of
Howard W. Pence, Inc., seeking a review of the ruling of the
Assistant Administrator pursuant to 29 CFR [sec] 5.13, dated July
27, 1983. The Assistant Administrator's ruling concerned the
applicability of the Davis-Bacon Act and the Contract Work Hours
and Safety Standards Act (hereinafter CWHSSA) to two of the firm's
truck drivers who hauled stone to the firm's construction site.
The facts in this appeal are not in dispute. Petitioner,
Howard W. Pence, Inc., was the prime contractor for the
Construction of an equipment concentration site, maintenance shop
and warehouse at Ft. Knox, Kentucky. The contract for the project
contained the labor standards provisions of both the Davis-Bacon
Act and CWHSSA. [1]
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[2] In addition to Pence being a construction contractor, the
firm also leases its trucks and drivers to the public when the
trucks are available, primarily to move rock and gravel from a
nearby quarry. Upon an investigation by the Army into Pence's
operation at Fort Knox, it was discovered that although two of
Pence's employees were hauling stone and rock to the construction
site, they were not listed on the payrolls for the Army project.
Pence contends that when the employees are engaged in hauling
rock and gravel to the construction site they are performing the
services of a materialman and therefore not subject to the
Davis-Bacon Act or to CWHSSA. Petitioner argues that the
corporation has two separate operations, one of construction and
one of material supply and hauling. It should be noted that
the two employees in question also worked as laborers on the
construction project and when they did, they were paid the
appropriate predetermined wage rate for their services.
On July 27, 1983, the Assistant Administrator ruled that
since petitioner's operations of hauling and construction were
not operations of separate employers, and since petitioner
employed the truck drivers to transport building materials to
the construction site, the two drivers were entitled to prevailing
wages under the Davis-Bacon Act for their hours worked in such
transportation. The Assistant Administrator relied on 29 CFR [sec]
5.2(g) of the Regulations in arriving at her decision. [2]
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[3] On October 14, 1983 Pence filed a Petition for Review of the
Assistant Administrator's decision with the Wage Appeals Board.
Petitioner has provided the Board with copies of invoices
which show that the company rented its trucks and their drivers to
deliver and sometimes spread rock and gravel to various sites in
Kentucky. In mid-1981 to January, 1982 it used two of its drivers
to haul gravel to the work site at Fort Knox from a quarry located
about 15 miles away. It is contended that the drivers spent only
about 10 minutes out of each hour on the site. While the drivers
were on the site they dumped the rock and gravel using the
"tailgate" method, and then left the site to go to the quarry and
pick up another load of stone. It is petitioner's position that
the two truck drivers are exempt from coverage by the Davis-Bacon
Act because they are bona fide materialmen and the fact that the
drivers are employees of petitioner does not cause them to lose
this exemption. It is petitioner's contention that the two drivers
are exempt from the labor standards provisions of the Act on days
when they were engaged solely in the hauling of materials to the
site of work in connection with a bona fide hauling operation.
* * *
The Wage Appeals Board considered this appeal on the basis
of the Petition for Review, the record of the case before the [3]
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[4] Assistant Administrator, a statement on behalf of the Assistant
Administrator and a memorandum in support of the Assistant
Administrator's ruling filed by the Intervenor-Building and
Construction Trades Department, AFL-CIO. No request for a hearing
was received by the Board.
The Board has considered this case in light of its recent
decision in Midway Excavators, Inc., and King Town Transportation,
Inc., WAB Case No. 81-17 (December 13, 1983) and Denial of Motion
for Reconsideration (February 14, 1984). In Midway the Board held
that when a contractor was utilizing its truck driver employees to
haul materials from commercial suppliers to Federal or federally
assisted job sites, the firm was acting in the place of a
commercial supplier, and therefore the truck drivers were not
covered by the labor standards provisions of the Davis-Bacon and
related Acts. However the premise that the truck drivers were not
covered was based upon the particular factual situation presented
by that case.
It was undisputed and supported by the record in Midway that
the employees involved were employed [*] exclusively [*] to haul
materials and supplies not just to various covered construction
projects of the construction contractor, but to other non-covered
construction projects also. [*][EMPHASIS IN ORIGINAL][*] The
record showed that these drivers were leased with the trucks to
other firms and suppliers. The hauling and supply service
operation to the general public was extensive and was an on-going
operation prior to, during and [4]
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[5] after completion of the construction projects subject to the
Davis-Bacon and related acts.
The Board is of the opinion that the factual situation in the
case in question is distinguishable from that in Midway.
The record is clear that the truck driver were not just
hauling materials and supplies but were working as laborers on the
construction site. The setting up of the hauling operation appears
to coincide with the bidding and obtaining of the covered
construction project and the record is void of any evidence showing
that petitioner performed any hauling for the general public during
the period such services were provided to the covered work site.
In fact, only a token amount of hauling and supply services have
been performed over a three year period to the general public.
It was not the intent of the Board to exclude from coverage
all truck drivers employed by a construction prime contractor or
subcontractor who haul materials and supplies from a commercial
supplier to a Davis-Bacon or related Act covered job site. Only
those truck drivers employed by a company that qualifies as a bona
fide materialman or truck drivers employed by a firm acting in the
place of a commercial supplier.
The Board is of the opinion that the language contained in
29 CFR [sec] 5.2(g) which provides in part that ". . . the
transporting of materials and supplies to and from the building or
work by the employees of the construction contractor or
construction subcontractor [5]
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[6] . . ." is within the meaning of the terms "construction",
"prosecution", and "completion", as utilized in the Davis-Bacon and
related Acts was intended to cover the situation presented by this case
/FN1/ This firm's operation was primarily to utilize [*] construction
[*] employees to transport materials and supplies to its construction
site. Certainly while performing this type of operation the firm was
not a bona fide materialman nor was it acting in the place of a
commercial supplier. [*][EMPHASIS IN ORIGINAL][*]
For these reasons, the truck drivers employed by petitioner
are covered by the labor standards provisions of the Davis-
Bacon Act.
In view of the above, the decision of the Assistant
Administrator is affirmed and the petition is hereby dismissed.
* * *
Member Rothman, Concurring:
I concur in the result reached and the basic reasoning of the
decision. But I am not in agreement that the fact that the two
employees in question also worked as laborers on the construction
site is one of the determinative factors. These employees worked
as laborers prior to the hauling of the aggregate in this contract
and thereafter performed no work on the project site other than
tailgating the aggregate brought in. [6]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN1/ 29 CFR Part 5 was revised and published at 46 FR 19540,
April 29, 1983, effective June 28, 1983. The pertinent regulation
is now set forth in 29 CFR [sec] 5.2(j). [6]
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[7] Member Dunn, Concurring:
In Midway Excavators, Inc. and King Town Transportation, Inc.,
WAB Case No. 81-17 (December 13, 1983), we held that because
Midway's truck drivers were not just hauling materials or
delivering equipment to federally funded job sites, but to
non-covered sites as well, the contractor was acting in "the place
of a commercial supplier" on the covered projects and, therefore,
its truck drivers were not covered by the Act, so long as they
performed no other "construction" type work on the site.
The facts in Midway convinced us that it was inappropriate
to apply the Davis-Bacon requirements to the contractor's truck
drivers. However, the facts in the instant petition for review
convince me that the holding in Midway is wrong and should be
overruled. While I concur in the determination that the truck
drivers employed by petitioner in this case are covered by the
Davis-Bacon Act, the difference between the facts in this case
and those in Midway is not so great that it is self-evident. As
a result, our holding in this case will complicate even further
an already confusing situation concerning coverage of truck
drivers employed by a covered construction contractor to carry
materials and supplies to construction job-sites.
Inasmuch as our decision in Midway is arguably inconsistent
with the applicable regulations promulgated by the Secretary of
Labor, 29 CFR [sec] 5.2(j) /FN2/, the most prudent action by the
Board [7]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN2/ See, fn. 1, supra. [7]
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[8] is to overrule Midway and abandon the principle that truck
drivers employed by contractors otherwise covered by the Davis-
Bacon Act and the related statutes are not protected by Davis-
Bacon labor standards when their employer is acting in the
"place of a commercial supplier" on covered projects.
BY ORDER OF THE BOARD
Craig Bulger,
Executive Secretary
Wage Appeals Board [8]
