ERG MECHANICAL, INC., WAB Nos. 88-33 and 88-34 (WAB Mar. 29, 1991)
CCASE:
BERG MECHANICAL, INC.
DDATE:
19910329
TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D. C.
In the Matter of:
BERG MECHANICAL, INC.
River Oaks Apartments WAB Case No. 88-33
BERG MECHANICAL, INC.
Evangeline Oaks Apartments WAB Case No. 88-34
BEFORE: Charles E. Shearer, Jr., Chairman, Ruth E. Peters,
Member, Patrick J. O'Brien, Member
DATED: March 29, 1991
DECISION OF THE WAGE APPEALS BOARD
This case is before the Wage Appeals Board on the petitions of
Berg Mechanical, Inc. ("Berg" or "Petitioner") for review of the
February 21, 1985 ruling of the Assistant Administrator of the Wage
and Hour Division (reconsideration denied, July 9, 1985),
disallowing the addition of a "provisional apprentice trainee"
classification and corresponding wage rate to Davis-Bacon Wage
Determination No. LA83-4060 as applied to the River Oaks and
Evangeline Oaks Apartment projects. The projects were subject to
Davis-Bacon labor standards provisions because they were assisted
by the Department of Housing and Urban Development ("HUD") and the
Federal Housing Administration ("FHA") pursuant to Section 212 of
the National Housing Act, 12 U.S.C. [sec] 1715c. For the
reasons set forth below, the Board declines to review this matter
and dismisses the petitions. [1]
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[2] I. BACKGROUND
According to Petitioner, Berg contracted in the autumn of 1983
with Fairfield Construction Company ("Fairfield"), the prime
contractor on the River Oaks project, to provide labor and
materials for all plumbing systems to be installed on the project.
Berg employed four "provisional apprentice trainees" on the
project. Provisional apprentice trainees were not included as a
classification in the applicable wage determination. Berg paid the
provisional apprentice trainees $5 to $5.50 per hour, pursuant to
an agreement between the Mechanical Contractors Association of
Shreveport-Bossier, Inc. and Plumbers and Pipefitters Local Union
141. The applicable wage determination contained prevailing wage
rates, including fringe benefits, of $18.28 per hour for journeyman
plumbers, and $7.85 for laborers. Berg's "provisional
apprenticeship trainee" program was not a plan registered and
approved by the Bureau of Apprenticeship and Training, Employment
and Training Administration ("BAT"), or by a state apprenticeship
agency recognized by BAT, as required by Department of Labor
regulations. (FOOTNOTE 1)
On December 13, 1983, Berg contracted with Shreve Land
Company, Inc. ("Shreve Land") to install all the plumbing systems
on the Evangeline Oaks project. Berg used five provisional
apprentice trainees on this project.
Fairfield informed Berg in October 1984 that HUD would not
accept the provisional apprentice trainee classification on the
project. On November 14, 1984, HUD instructed Berg to deposit in
escrow $13,437.67 (the back wages computed to be owed to Berg's
provisional apprentice trainees on the River Oaks project). Berg
complied by having a bank money order drawn to the FHA. HUD
informed Fairfield on December 13, 1984 that it had rejected Berg's
request for an additional trainee classification.
In December 1984, HUD instructed Berg to deposit $19,756 in
escrow (the back wages computed to be owed to the provisional
apprentice trainees on the Evangeline Oaks project); Berg complied
by having a money order drawn to the FHA. HUD informed Shreve Land
on January 30, 1985, that it had rejected Berg's request for an
additional trainee classification.
The Assistant Administrator issued a ruling letter on February
21, 1985, denying the addition of a provisional apprentice trainee
classification to Davis-Bacon Wage Determination LA83-4060, which
applied to both the River Oaks and Evangeline Oaks projects.
Berg's "provisional apprentice trainee" [2]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
(FOOTNOTE 1) The Department regulations concerning apprentices (29 C.F.R.
5.5.(a)(4)(i)) provided that an apprenticeship program can be
approved by a state apprenticeship agency recognized by BAT. The
Department regulations governing employment of trainees (29 C.F.R.
5.5 (a)(4)(ii)) do not allow for approval of trainee programs by a
state agency. [2]
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[3] classification was rejected as a bona fide trainee
classification because it was not part of a program approved and
registered by BAT, as required by 29 C.F.R. 5.5(a)(4).
Berg requested reconsideration of the Assistant
Administrator's ruling on March 21, 1985. Ralph Hunt, Director of
BAT's Dallas Region wrote to Berg on April 4, 1985, stating that
Berg's problem was "one of semantics" because Berg did not have a
trainee program and that in creating the job title of provisional
apprentice trainee, "the Bargaining Committee [for the agreement
with the union] had created a new innovative name for an old
occupation, that of laborer." The Director also told Berg that the
former Director of Apprenticeship for the State of Louisiana had no
authority to approve the provisional apprentice trainee program,
and that the state director's approval had pertained only to the
Shreveport Pipetrades Registered Apprenticeship Standards.
On July 9, 1985 the Assistant Administrator responded to
Berg's request for reconsideration by affirming the February 21,
1985 ruling. The Assistant Administrator stated:
Based on Mr. Hunt's letter to you . . . it is clear that the
"provisional apprentice trainee" class at issue is not part of
any duly registered program. Moreover, the duties which may
be performed by this classification [as described by the union
agreement] are similar to those which may also be performed by
journeymen and apprentices. We cannot conclude from this and
other available information that the duties attributed to the
subject classification are in fact distinct from those of the
journeyman classification.
II. DISCUSSION
The Department's regulations (29 C.F.R. 5.5(a)(4)(ii)) provide
that "trainees will not be permitted to work at less than the
predetermined rate for the work performed unless they are employed
pursuant to and individually registered in a program which has
received prior approval, evidenced by formal certification by the
[BAT]." It is undisputed by Petitioner that Berg's provisional
apprentice trainee program was not approved and certified by BAT.
Instead, Berg's primary argument is that HUD failed to inform Berg
that the use of trainees without approval was not permitted and
delayed in informing Berg that the provisional apprentice trainees
were not being properly paid. The Solicitor responds that Berg's
argument regarding the information provided by HUD is factually
wrong. [3]
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[4] The Solicitor also argues that, in any event, under
Board precedent (FOOTNOTE 2) advice from a contracting agency cannot
"estop" the Department of Labor from requiring payment of the
proper wage rate.
Although the Board finds the Solicitor's arguments persuasive,
they need not be addressed here, since the Board has decided, on
the basis of the nature of the relief sought by Berg, to dismiss
the petitions for review. In the petitions -- which, curiously,
were filed nearly three years after the July 9, 1985 denial of the
request for reconsideration of the Assistant Administrator's
February 21, 1985 final ruling -- Berg requests that the Board
"issue an order directing that the U.S. Department of Labor approve
and certify retroactively from January 1, 1984, the provisional
apprenticeship trainee program," and then grant Berg's request for
an additional wage classification for trainees. Thus, even
Petitioner apparently recognizes the binding nature of the
Department's trainee regulations at 29 C.F.R. 5.5(a)(4)(ii).
The issue appropriately before the Board in considering Berg's
petitions for review is whether the Assistant Administrator's
February 21, 1985 ruling, affirmed in the July 9, 1985 denial of
reconsideration, is correct. However, Berg's request for relief
does not contemplate the Board's review of the Assistant
Administrator's ruling on the basis of the undisputed facts
underlying that ruling. Instead, Berg requests a Board order that
would accomplish that which Berg failed to do -- that is, obtain
BAT's approval of the provisional apprentice trainee program as
required by Department regulations. The regulations governing
practice before the Wage Appeals Board (29 C.F.R. Part 7) provide
that the Board may exercise its discretion to hear and decide
appeals based upon, among other things, "the nature of the relief
sought" by the petitioner. Given the nature of the relief sought
by Berg in this matter, the Board exercises its discretion to
decline to review the ruling of the Assistant Administrator, and
dismisses Berg's petitions for review.
BY ORDER OF THE BOARD:
Charles E. Shearer, Jr., Chairman
Ruth E. Peters, Member
Patrick J. O'Brien, Member
____________________________
Gerald F. Krizan, Esq.
Executive Secretary [4]
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(FOOTNOTE 2) Tollefson Plumbing and Heating Co., WAB Case No. 78-17 (Sept.
24, 1979). [4]
