SCHNABEL ASSOCIATES, INC., WAB No. 89-18 (WAB June 28, 1991)
CCASE:
SCHNABEL ASSOCIATES, INC
DDATE:
19910628
TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D. C.
In the Matter of:
SCHNABEL ASSOCIATES, INC.,
Prime Contractor WAB Case No. 89-18
and
RON GINNS, INC.,
Subcontractor
BEFORE: Charles E. Shearer, Jr., Chairman
Ruth E. Peters, Member
Patrick J. O'Brien, Member
DATED: June 28, 1991
DECISION OF THE WAGE APPEALS BOARD
This matter is before the Wage Appeals Board on the petition
of Ron Ginns, Inc., ("Ginns" or "Petitioner") for review of the
decision and order (Attachment) of Administrative Law Judge ("ALJ")
Ralph Romano, dated May 24, 1989. For the reasons stated below,
the Board denies the petition for review.
I. BACKGROUND
In September 1981, prime contractor Schnabel Associates, Inc.
("Schnabel") entered into a general construction contract to
renovate and rehabilitate apartments at Kearsley Home in
Philadelphia, Pennsylvania. This contract was funded by a grant
from the Department of Housing and Urban Development ("HUD").
Ginns contracted with Schnabel to perform electrical work under the
HUD-funded contract. The applicable wage determination required
that electricians be paid an hourly rate of $17.70. [1]
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[2]
On January 7, 1982 Ginns entered into an Apprenticeship
Training Agreement with the Department of Labor's Bureau of
Apprenticeship and Training ("BAT"), which allowed Ginns to pay
less than the electrician's prevailing wage rate to electrician
apprentices employed on the Kearsley Home project. The training
agreement provided that Ginns could employ only one electrician's
apprentice to every four journeyman electricians. BAT official
Salvatore D'Amore testified (Tr. 64) that he explained the
provisions of the apprenticeship agreement to John H. Adams, Jr.,
vice president of Ginns, before Ginns began performing work on the
project. Both of Ginns' responsible managing officers, Ron Ginns
and Adams, acknowledged that they were aware of the ratio
requirements before Petitioner began performance on the electrical
construction contract, and also acknowledged that Petitioner failed
to comply with the specified apprentice ratio during Ginns'
performance on the contract. The certified payrolls submitted by
Petitioner and signed by Ron Ginns and Adams indicated that
Petitioner had exceeded the allowable apprentice ratio on a regular
basis.
Ginns did not list employees Charles Linder or Charles Hassan
on any of the weekly certified payrolls submitted to HUD, and did
not list employee Thomas DeSanto on any of the payrolls except for
one pay period. None of these three employees was registered in an
apprenticeship program with BAT or a recognized state
apprenticeship agency, as required by 29 C.F.R. 5.5(a)(4). Hassan
and DeSanto were paid the apprentice hourly rate of $10.74; Linder
was paid $3.50 per hour.
Following a HUD investigation of Ginns' performance on the
contract, this matter proceeded to a hearing before the ALJ. The
ALJ issued a decision and order on May 24, 1989, finding that Ginns
violated the apprenticeship ratio requirements of 29 C.F.R.
5.5(a)(4), and that as a result of these violations eight
apprentice electricians in excess of the specified ratio were
entitled to the full prevailing wage for journeyman electricians.
The ALJ also found that Hassan, DeSanto and Linder were not
registered in a BAT-approved training program, that they performed
work on the Kearsley Home project, and that they were not paid the
full prevailing wage for journeyman electricians. The ALJ awarded
back wages in the amount of $33,584.54.
II. DISCUSSION
The regulatory provisions regarding employment of apprentices
on projects subject to the Davis-Bacon Act or Related Acts are set
forth at 29 C.F.R. 5.5(a)(4)(i), which specifies that apprentices
will be permitted to work for less than the prevailing wage only
when they are employed pursuant to and individually registered in
a bona fide apprenticeship program registered with BAT or a state
[2]
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[3] apprenticeship agency recognized by BAT. The regulation
also provides that the "allowable ratio of apprentices to
journeymen on the job site in any craft classification shall not be
greater than the ratio permitted to the contractor as to the entire
work force under the registered program." In addition, the
regulation states that any apprentice employed in excess of the
specified ratio shall be paid the prevailing wage rate for the work
actually performed. See also, Soule Glass and Glazing Co., WAB
Case No. 78-18 (Feb. 8, 1979).
Petitioner contends that the Department of Labor has failed to
meet its burden of proof that Ginns violated the ratio requirement,
and that the ALJ's finding that Ginns violated the apprentice ratio
requirement was against the weight of the evidence. However, the
ALJ correctly found Ginns' position on the ratio requirement to be
meritless. As the ALJ stated, Ginns "freely and knowingly assumed
the ratio obligation upon its signing of the subcontract . . . .
From the beginning of its execution of that subcontract, through to
its completion, [Ginns] regularly submitted . . . certified payroll
reports, certified by its principals as true and correct,
containing data, which, on its face, established the violation of
that obligation."
Ginns also argues that Petitioner should be relieved of
liability for back wages because HUD allegedly delayed in notifying
Petitioner of its non-compliance with the allowable apprenticeship
ratio, and because BAT should have notified Petitioner of the
"ratio reduction" procedure. Again, however, the Board concludes
that Ginns' argument is meritless. First, Board precedent
establishes that the responsibility for having a bona fide
apprenticeship program, registering the apprentices and complying
with the apprenticeship ratio requirements rests with the
contractor, not BAT or the contracting agency. Tollefson Plumbing
and Heating Co., WAB Case No. 78-17 (Sept. 24, 1979). Furthermore,
Petitioner's argument is without support in the record evidence.
Quite simply, Petitioner obviously had notice of the apprenticeship
ratio requirements by virtue of the apprenticeship training
agreement -- which specified the allowable ratio -- executed by
Petitioner and BAT before Ginns began performing work on the
Kearsley Home project. In this context, Ginns' responsibility for
its repeated violations of the ratio requirement cannot be evaded
by arguing that the violations should have been spotted sooner, or
that someone should have explained how to modify the ratio.
Petitioner also disputes the ALJ's findings and conclusions
regarding employees DeSanto and Linder (Petitioner does not dispute
that Hassan was underpaid). However, the ALJ's determinations
regarding the underpayment of these employees rests largely upon
the ALJ's evaluation of the credibility of witnesses, the
reliability of testimony and the weight to be accorded to the
evidence in the record, and the Board discerns no basis for
disturbing the ALJ's evaluation of the evidence. Furthermore, the
ALJ's allocation of the burdens of [3]
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[4] proof in this matter are consistent with the principles set
forth in Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680 (1946).
See Apollo Mechanical, Inc., WAB Case No. 90-42 (March 13, 1991),
at pp. 2-4.
Finally Petitioner makes the bare assertion, unsupported by
any specific argument or factual discussion (see 29 C.F.R. 7.5(a)),
that the "advocative form" of the ALJ's decision and order
indicates "an absence of impartiality" on the part of the ALJ, and
that Petitioner was denied a fair and impartial hearing. However,
although the ALJ's decision and order -- in the context of
evaluating the record evidence -- does criticize the merits of
Petitioner's defenses, the decision and order does not display a
lack of impartiality. In short, Petitioner has failed to make a
showing that reversible error was committed.
The petition for review is denied. The ALJ's decision and
order is affirmed.
BY ORDER OF THE BOARD:
Charles E. Shearer, Jr., Chairman
Ruth E. Peters, Member
Patrick J. O'Brien, Member
______________________________
Charles E. Shearer, Jr.
Chairman [4]
