HOMER L. DUNN DECORATING INC., WAB No. 87-03 (WAB Mar. 10, 1989)
CCASE:
HOMER L. DUNN DECORATING
D
DATE:
19890310
TTEXT:
~1
[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D.C.
In the Matter of
HOMER L. DUNN DECORATING, INC., & WAB Case No. 87-03
Homer L.Dunn, President & Owner Dated: March 10, 1989
APPEARANCES: George J. Tichey II, Esquire, & Gordon A. Letter,
Esquire, for Homer L. Dunn Decorating, Inc., & Homer
L. Dunn, President & Owner
Gerald F. Krizan, Esquire, for the Administrator,
Wage and Hour Division, U.S. Department of Labor
BEFORE: Jackson M. Andrews, Chairman, Thomas X. Dunn,
Member, and Stuart Rothman, Member
DECISION OF THE WAGE APPEALS BOARD
This case is before the Wage Appeals Board on the petition of
Homer L. Dunn Decorating, Inc., and its president and owner, Homer
L. Dunn, (hereinafter Dunn Decorating) seeking review of the
Decision and Recommended Order of the Administrative Law Judge,
dated July 19, 1985, and a Supplementary Decision and Order, dated
December 9, 1986.
In these decisions the Administrative Law Judge (hereinafter
ALJ) found Dunn Decorating had failed to pay its employees
applicable prevailing wage rates and, in some cases, overtime on
six contracts, was responsible for wage kickbacks on two contracts
and falsified its certified [1]
~2
[2] payroll records on five contracts. It was determined that Dunn
Decorating was liable for the payment of $20,116.43 in back wages and it
was ordered that the firm and its president be debarred from doing
business with the Federal government for willful and aggravated
violations of the Copeland Anti-Kickback Act and also be debarred for
disregard of their obligations to the firm's employees under the
Davis-Bacon Act.
The seven painting contracts at various government
installations in California which are the subject of this case were
performed by Dunn Decorating prior to April, 1982. At that time
nine contract labor standards disputes arising from these contracts
were referenced for administrative hearing in Los Angeles,
California. The hearing was held on June 6 and 7, 1984. Both
parties were represented by counsel. Likewise, at a hearing before
the Wage Appeals Board on December 1, 1988, all parties were
present and represented by counsel.
The main thrust of the petitioners' argument to the Board,
both in its briefs and at the oral argument, was that the hearing
before the ALJ was so prejudicial and flawed against the
petitioners that the original Decision and Order of the ALJ and the
Supplemental Decision and Order of the ALJ should be reversed by
this Board.
- - -
The Board considered this appeal on the basis of the [2]
~3
[3] Petition for Review and Reply Brief filed on behalf of the
Petitioners, the Statement for the Administrator and the record of
the case before the Wage and Hour Division filed by the Solicitor
of Labor, the record of the case and hearing before the ALJ and her
subsequent Decision and Order setting back wages owed to the firms
employees and her Supplemental Decision and Order pertaining to
debarment of Dunn Decorating, and the aforementioned hearing before
the Wage Appeals Board.
It appears to the Board that the ALJ in this case was faced
with the difficult task of weeding out evidence from a morass of
testimony of witnesses, most of whom were newly in this country.
The ALJ did so judiciously and with sound reasoning. The judge took
into consideration that most of these employees were not aware of
their rights and most of all were fearful of Mr. Homer L. Dunn and
his foreman, Jimmy, whom the ALJ found to have accepted kickbacks.
Throughout her decision the ALJ found that testimony from the
workers was hard to come by because the employees were afraid they
would lose their jobs. Even those employees who at the time of the
hearing were not employed by the petitioner were fearful of Jimmy,
the kickback foreman. If the ALJ was overprotective of these
employees it was reasonable for her to have been so, considering
the violations of the petitioner and the manner in which they were
treated. The ALJ's credibility findings were made only when every
detail of the [3]
~4
[4] witness' testimony was carefully described and analy[z]ed.
In reaching her findings and conclusions, it must be
remembered that the ALJ heard and observed the witnesses during the
hearing. It is for the trial judge to make determinations of
credibility, and an appeals body such as the Wage Appeals Board
should be loathe to reverse credibility findings unless clear error
is shown.
The Supreme Court stated in Universal Camera v. NLRB, 340 U.S.
474 (1950) at p. 494:
Conclusions, interpretations,law and policy should of
course, be open to full review. On the other hand, on
matters which the hearing commissioner, having heard the
evidence and seen the witnesses, is best qualified to
decide, the agency should be reluctant to disturb his
findings unless error is clearly shown.
Also,
. . . material facts in any case depend upon the
determination of credibility of witnesses as shown by
their demeanor or conduct at the hearing.
[340 U.S. at p. 496]
Running through the decisions of the ALJ are credibility
findings concerned with fear. Fear is a compelling element as to
the testimony of a witness and how he testifies. Fear cannot be
found in the transcript of the testimony. It is determined by the
trial judge by observing the eyes of the witness, movements by his
hands, turning of a head to an interested party in the courtroom or
even the change of color on the face of the witness when a
particular question is posed. The appellate body does not, and
cannot see this. Only the trial judge does, and his observations
leading to [4]
~5
[5] credibility findings, for these reasons alone, must be
respected.
Many of the workers involved here were recent arrivals in the
country, had language problems, needed work, were unaware of
prevailing rates and mainly were concerned with keeping their jobs.
The main witness for the Government was Mr. Vissessmith, who,
at the time of the hearing was a competitor of petitioner, but
still was reluctant to testify, until he was advised that a
subpoena would issue if he did not testify.
The Compliance Officer (CO) had difficulty in getting
interviews from employees as stated in the ALJ's decisions. The CO
made errors in computations of hours worked, but promptly admitted
them. Corrections were made both by the CO and by the ALJ.
The ALJ, in several instances dismissed claims of certain
violations by the Government because the evidence did not support
such charges. From time to time she found calculations of the CO as
inaccurate, which were promptly corrected. On several occasions she
found evidence of the Government conflicting and she ignored it.
All of the above is set forth because the petitioners attack
both the ALJ's main and supplementary decisions, and describe them
as "shocking" in deficiencies and errors. Both of these decisions
are attached hereto to show clearly how much these charges are
wrong. (Adopted by reference.) [5]
~6
[6] Concerning the Supplemental Decision and Order with respect to
debarment, the ALJ found in accordance with the original case and the
evidence thereunder that petitioners had engaged in aggravated and
willful violations of the Davis-Bacon and the Copeland Anti-Kickback
Acts. It was also shown in this case that between 1973 and 1980,
petitioners were found in violation of the Davis-Bacon and related acts
on ten separate contracts.
In support of debarment, the ALJ pointed out that petitioners
had failed to pay prevailing wages on three contracts, failed to
keep accurate records of hours worked on all contracts with the
exception of the China Lake contract and was deemed to have
violated the Copeland Anti-Kickback Act on two contracts.
The ALJ properly found that for willful aggravated violation
of the Copeland Anti-Kickback Act, the petitioners should be
subject to the ineligible list provis[i]ons as provided in 29 CFR
Sec. 5.12(a)(1) and should be subject to the ineligible list
provisions of Sec. 3(a) of the Davis-Bacon Act.
Both the Decision and Order and the Supplemental Decision and
Order of the ALJ are affirmed.
- - -
Member Rothman, dissenting in part.
I write separately to concur with the result reached by [6]
~7
[7] my colleagues except with respect to one conclusion in the
Administrative Law Judge's Decision, which I would modify.
Unlike the majority, I find that it was inappropriate for the
ALJ to order the petitioners to make restitution of Copeland Act
Anti-Kickback monies which the ALJ concluded had been exacted from
English-speaking American employees.
In the case of a Copeland Act Anti-Kickback violation, it is
unlikely that a violator will keep records to be disclosed to the
Administrator. The ALJ made a conscientious attempt to determine
both the extent and the amount of the kickbacks. A sufficiently
large representative group of employees who were recent Asian
refugees and who spoke little or no English and a number of
Hispanics testified unequivocally to the practice by the Asian
supervisor to exact substantial kickbacks from these
non-English-speaking employees. The petitioners failed to rebut the
Administrator's prima facie case with respect to these Copeland Act
violations as to these Asian and Hispanic employees. However, the
ALJ found the same Copeland Act violations and assessed the same
restitution amounts against the petitioners on the basis that the
same Asian supervisor was at the same time instrumental in exacting
kickbacks from the English-speaking American employees. I am unable
to conclude that the Asian supervisor was able to impose his
threats and intimidations upon the English-speaking American
employees in the same way and to the same extent that he did [7]
~8
[8] upon the Asian and Hispanic employees who spoke little or no
English and were unaccu[]stomed with American practice and fair
dealing on Federally-aided Davis-Bacon Act construction.
I would therefore modify the Administrative Law Judge's
recommended order to eliminate the requirement that the
English-speaking Americans be reimbursed the kickback amounts which
the ALJ inferred were also paid by them. The supporting evidence in
the case of the newly arrived Asian employees is very strong while
there is little or no evidence that the same kickback policy and
pattern of collection was in effect between the Asian supervisor
and the English-speaking Americans.
While the business of the Wage Appeals Board is to bring
disputes over the interpretations and application of the
Davis-Bacon and related acts to an end by the development of
precepts, principles, and standards within the context of these
statutes and within the context of the construction industry, the
Board at times must look to other areas of employment law for
guidance. In this case no fault can be found with the way in which
the ALJ applied the body of law that has developed around the Mount
Clemens Pottery case, 328 U.S. 680, June 10, 1946, in the
administration of the Fair Labor Standards Act except with respect
to kickback payments by the English-speaking Americans. Contrary to
the contention of the petitioners in this matter not every [8]
~9
[9] employee need testify to make out the prima facie case, Donovan
v. New Floridian Hotel Inc., 676 F.2d 468, 472 (11th Cir. 1982),
Beliz v. W.H. McLeod & Sons Packing Co., 765 F.2d 1317, 1331 (5th
Cir. 1985). A sufficiently large and representative group of
employees did testify to establish a practice of non-payment of
overtime and Copeland Act Anti-Kickback violations. The petitioners
did not produce sufficient evidence of the precise amount of
overtime performed or of other evidence which negated the
reasonable inferences which the ALJ drew from the Department of
Labor's evidence. In this way, the petitioners failed to rebut the
Prima facie case established by the Department of Labor in
accordance with Mount Clemens, supra. To the extent that
petitioners presented evidence or testimony tending to rebut the
Department of Labor's prima facie case, that testimony was
considerably outweighed by the substantial evidence on the record
considered as a whole as developed by the Department of Labor's
witnesses. It is noted that the Administrative Law Judge cannot be
faulted for crediting the testimony of Mr. Vissessmith with respect
to overtime work and not crediting the testimony of Veera
Taveekanjana (Jimmy, the petitioners' foreman) once it was
convincingly established that he had been demanding and accepting
kickbacks in violation of the Copeland Act on a pervasive basis
from Asian refugees and Hispanic employees.
The determination of the Administrative Law Judge to [9]
~10
[10] place the petitioners on the three-year ineligibility list for
Davis-Bacon and Copeland anti-kickback violations is amply
supported by credible evidence.
I have considered the decision and the record in this case in
the light of the exceptions, briefs and oral argument and would
affirm the judge's ruling, findings and conclusions and would adopt
her recommended order except as above modified.
BY ORDER OF THE BOARD
Craig Bulger, Esquire,
Executive Secretary
Wage Appeals Board [10]