HARRY JOHNSON PLUMBING CO., INC., WAB No. 84-19 (WAB June 6, 1985)
CCASE:
HARRY JOHNSON PLUMBING CO
DDATE:
19850606
TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D.C.
In the Matter of
HARRY JOHNSON PLUMBING CO., INC. WAB Case No. 84-19
Walla Walla, Washington
EPA Contract No. 0599-0600 Dated: June 6, 1985
BEFORE: Alvin Bramow, Chairman, Thomas X. Dunn, Member
Stuart Rothman, Member
DECISION OF THE WAGE APPEALS BOARD
This case is before the Wage Appeals Board on the petition of
Harry Johnson Plumbing Company, Inc., (hereinafter Harry Johnson
Plumbing) seeking review of a decision of the Department of Labor
dated July 25, 1983 denying the Environmental Protection Agency's
(EPA) recommendation to waive the liquidated damages assessed at
$2860.00. The refusal to waive the assessment of the liquidated
damages was based on a finding by the Wage and Hour Division of the
Department of Labor that the amount of the liquidated damages was
correctly computed and that the firm did not meet the statutory
standards for waiver contained in 40 U.S.C. 330.
On October 14, 1980, petitioner was awarded a contract by EPA
to construct a sewer project in Moscow, Idaho. This contract was
subject to the requirement that time and one-half would be paid for
all hours worked in excess of eight hours per day and forty hours
per week as required by the Contract Work Hours [1]
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[2] and Safety Standards Act (CWHSSA).
An investigation of the project by the Wage and Hour Division
revealed that Harry Johnson Plumbing had failed to pay its
employees all of the overtime compensation required by CWHSSA and
had falsified its certified payrolls to EPA to make it appear that
it was in compliance.
At a conference following this investigation Wage and Hour
determined that $3,596.67 was due in overtime back wages to 11 of
the firm's employees. Petitioner paid all of the back wages due to
its employees and promised to comply with CWHSSA in the future.
Wage and Hour has now determined that $2860 are due from
petitioner for liquidated damages pursuant to 40 U.S.C. 328.
The liquidated damages assessed may be reduced or waived
according to 40 U.S.C. 330 if certain conditions contained therein
are met. On January 4, 1983 EPA recommended that the liquidated
dam[a]ges be waived. On July 25, 1983 the Wage and Hour Division
disagreed with this recommendation, finding that the violations
were not inadvertent and that petitioner had not exercised due
care. Primarily, Wage and Hour placed reliance on petitioner's
submission of the falsified certified payrolls as support for this
finding.
On two occasions in August and October, 1983, EPA requested
petitioner to forward the $2860 in liquidated damages to the [2]
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[3] government. Instead of paying the damages, on November 14, 1984
petitioner requested the Wage Appeals Board to review Wage and
Hour's denial of the waiver of the liquidated damages.
The Board considered this appeal on the basis of the Petition
for Review and a subsequent response to the government's statement
filed by the petitioner, a record of the case before the Wage and
Hour Division and the Statement for the Wage and Hour Division
filed by the Solicitor of Labor. No request for an oral hearing
was received by this Board.
* * *
The sole question before this Board is whether a waiver or
adjustment should be granted of the liquidated damages which were
assessed as a result of violations by the petitioner of the
Contract Work Hours and Safety Standards Act, 40 U.S.C. 327 et seq.
The Contract Work Hours and Safety Standards Act under which
the liquidated damages were assessed provides in pertinent part:
. . ., if it is found . . . that the contractor or
subcontractor violated the provisions of this Act
[*] inadvertently notwithstanding the exercise of due
care on his part and that of his agents [*],
recommendations may be made to the Secretary that an
[*] appropriate adjustment in liquidated damages be
made [*], or that the contractor or subcontractor
[*] be relieved of liability for such liquidated
damages [*]. The Secretary shall review all pertinent
facts in the matter and may conduct such investigations
as he deems necessary, so as to affirm or reject the
recommendation. 40 U.S.C. at [sec] 330(c). [*] (Emphasis
added.) [*]
There is no question that the petitioner violated the overtime
provisions of the aforementioned statute. The record shows [3]
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[4] that Harry Johnson Plumbing failed to pay its employees the
required overtime for hours worked in excess of forty hours per
week and eight hours per day for most of the contract period.
During certain weeks, the petitioner reported on its certified
payrolls that no more than forty hours per week and eight hours
per day were worked. This concealment in itself shows that the
violations were not "inadvertent" and that petitioner did not
exercise "due care". In a recent decision the Board indicated
that where there is a submission of falsified payrolls the
assessment of liquidated damages should not be waived: See Major
Associates, Inc., WAB Case No. 84-14 (May 20, 1985).
Also, in Major Associates the Board held that where the
violations were not flagrant and there were no known previous
violations, the full assessment of liquidated damages is not
necessarily mandated. Here, the Board is faced with a similar
case.
The overtime violations certainly do not appear to be of
a flagrant nature. This, coupled with the fact that the operating
officer is new in the business and has performed no previous
government contracts, leads the Board to believe that the
violations in this case do not warrant the full assessment of
liquidated damages. [4]
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[5] In view of the foregoing, it is the decision and order of
this Board that the liquidated damages be adjusted to $715.00.
BY ORDER OF THE BOARD
Craig Bulger,
Executive Secretary
Wage Appeals Board [5]
