NORTH STAR INDUSTRIES, INC., WAB No. 92-02 (WAB Sept. 30, 1992)
CCASE:
NORTH STAR INDUSTRIES
DDATE:
19920930
TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D. C.
In the Matter of:
NORTH STAR INDUSTRIES, INC.
Lower-Tier Subcontractor WAB Case No. 92-02
With respect to laborers and mechanics employed
by the lower-tier subcontractor under Bonneville
Power Administration Contract No. DE-AC79-85BP19861
(8726-020525-N004) Celilo Converter Station Addition,
The Dalles, Oregon
BEFORE: Charles E. Shearer, Jr., Chairman
Ruth E. Peters, Member
Anna Maria Farias, Member
DATED: September 30, 1992
DECISION OF THE WAGE APPEALS BOARD
This matter is before the Wage Appeals Board on a petition
filed by North Star Industries, Inc., seeking review of the January
7, 1992 Decision and Order issued by Administrative Law Judge
("ALJ") Vivian Schreter-Murray. We have fully considered the
record and the arguments presented by the parties in their written
statements and at oral argument conducted on July 14, 1992. For
reasons stated below the ALJ's decision (copy attached) is
affirmed. [1]
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[2] I. BACKGROUND
BBC Brown Boveri contracted with the Bonneville Power
Administration to perform construction work at the Celilo Converter
Station Addition in the Dalles, Oregon. Boveri subcontracted part
of the project to Hoffman Construction Company which, in turn,
subcontracted sheet metal work to Petitioner, North Star
Industries, Inc. ("North Star"). The contract was subject to the
Davis-Bacon Act (40 U.S.C. [sec] 276a et seq.), the Contract Work
Hours and Safety Standards Act (40 U.S.C. [sec] 327 et seq.)., and
applicable regulations (29 C.F.R. Part 5). Work on North Star's
aspect of the project fell within the trade jurisdiction of the
Sheet Metal Workers union. The relevant wage determination's
hourly rate for sheet metal workers (Wage Decision No. OR 86-1 with
Modifications 1-9) on the converter station's construction was
$20.06, including fringe benefits. The applicable wage rate for
apprentices on this project was $6.25 per hour.
Department of Labor regulations permit an employer to employ
apprentices, including workers with probationary status as
apprentices, and pay them at the prevailing rate for apprentices,
rather than the wage rates established for the particular trades on
the wage determination, on federal construction projects (29 C.F.R.
5.5(a)(4)(i)). /FN1/ Where probationary apprentices who are not
individually registered in an approved apprenticeship program are
employed, they must be paid at the full wage rates unless within
the first ninety days of probationary employment they "have been
certified" by the U.S. Department of Labor's Bureau of
Apprenticeship and Training ("BAT") or a state [2]
/FN1/ Section 5.5(a)(4)(i) provides, in pertinent part, that
Apprentices will be permitted to work at less than the
predetermined rate for the work they performed when they
are employed pursuant to and individually registered in
a bona fide apprenticeship program registered with the
U.S. Department of Labor, Employment and Training
Administration, Bureau of Apprenticeship and Training, or
with a State Apprenticeship Agency recognized by the
Bureau, [*] or if a person is employed in his or her
first 90 days of probationary employment as an apprentice
in such an apprenticeship program, who is not
individually registered in the program, but who has been
certified by the Bureau of Apprenticeship and Training or
a State Apprenticeship Agency (where appropriate) to be
eligible for probationary employment as an apprentice.[*]
[*](Emphasis supplied.)[*]
In addition, 29 C.F.R. 5.2(n)(1) defines "apprentice" as
(i) a person employed and individually registered in a
bona fide apprenticeship program registered with [BAT],
or with a State Apprenticeship Agency recognized by the
Bureau, or (ii) [*] a person in the first 90 days of
probationary employment as an apprentice in such an
apprenticeship program, who is not individually
registered in the program, but who has been certified by
[BAT] or a State Apprenticeship Agency (where
appropriate) to be eligible for probationary employment
as an apprentice[.][*] [END FN1] [2]
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[3] apprenticeship agency certifies them "to be eligible for
probationary employment" as apprentices. Id. /FN2/
Area One Northwest Sheet Metal Workers Joint Apprenticeship
Committee (the "JAC") was a local committee formed pursuant to
Oregon state law, and the JAC's standards were approved by the
State's Apprenticeship and Training Council. The JAC maintained
its apprenticeship program in conformity with those standards. The
JAC certified North Star as a training agent in its apprenticeship
program.
The parties stipulated that during the period relevant to this
action, the standards for indenture under the JAC's rules were that
the applicant for apprenticeship must:
1. fill out a numbered declaration of interest and execute
the correspondingly numbered register
2. take and pass the GATB (General Aptitude Test Battery)
3. be issued an intent to hire document with a number
corresponding to that on the numbered register
4. sign an out-of-work list and apply at approved or
approvable employers
5. have the employer execute the intent to hire document
6. fill out an Application for Apprenticeship form, and
execute an agreement card.
7. submit the application and agreement at a meeting of the
JAC for approval and final processing
The JAC permitted an exception to the requirement that an
applicant for apprenticeship pass the GATB test. An applicant who
failed the test was permitted to appear before the JAC with his
employer to provide alternative [3]
/FN2/ Department of Labor regulations define (at 29 C.F.R.
29.2(n)(2)) "certification" by BAT as "[*]written approval[*]"
of "[a]n individual as eligible for probationary employment as an
apprentice under a registered apprenticeship program." (Emphasis
supplied.) In addition, Section 29.3(d) provides:
(d) The names of persons in the first 90 days of
probationary employment as an apprentice under an
apprenticeship program registered by the Bureau or a
recognized State Apprenticeship Agency, if not
individually registered under such program, shall be
submitted immediately after employment to the Bureau or
State Apprenticeship Agency for certification to
establish the apprentice as eligible for such
probationary employment.
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[4] assurance of competence to enter the program. Furthermore, the
JAC would consider a failing applicant to be registered in the
program on a probationary basis if the applicant participated in a
remedial instruction program in a required subject. It was the
custom of the JAC to specifically advise a training agent if an
individual failed the GATB so that remedial courses could be begun,
or so that the employer could appear before the JAC to attest
through alternative means, the competence of the individual in
question.
The employees whose wage rights were subject to this action
(with three apparent exceptions) applied to the apprenticeship
program, but failed the GATB test. /FN3/ Contrary to general
practice, individuals had received from North Star intent to hire
letters which reflected the company's intention to hire them on the
federal project. The standard procedure was not to approve
intention to hire documents until the apprentice applicant had
demonstrated his minimum qualifications for the program, including
a passing grade on the GATB. Because the project was an out-of-
area project, the JAC issued these letters of intent in blank based
on these "extenuating circumstances." /FN4/
In an undated letter to the JAC, North Star requested that the
affected employees be certified that they "were eligible for
probationary employment as apprentices during their first ninety
days of employment at North Star. . . ." By letter dated December
21, 1988, the JAC stated that at its December 14, 1988 meeting, the
JAC considered the names submitted by North Star. The JAC added:
In all cases a Declaration of Interest/Apprenticeship
Application was completed and signed by the applicant.
Had the individual pursued the steps necessary to meet
the minimum requirements, he/she would have been eligible
for indenturement to the JAC.
Based on the above circumstances, it is the OPINION
[original emphasis] of this committee that the listed
applicants were eligible for probationary employment as
an apprentice.
However the committee entertained a question of its own:
Is a committee, populated by Sheet Metal tradesmen not
versed in the law nor specific government regulations,
the best source for this opinion? [4]
/FN3/ The parties stipulated that employee John C. Zeigler passed
the GATB. The record does not indicated that employees Paul
Vandehey and William A. Ward failed the GATB.
/FN4/ For a description of the affected employees' involvement in
the JAC sheet metal workers' apprenticeship program, see the ALJ's
decision and order at pp. 5-6. [4]
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[5] II. THE ALJ'S DECISION AND ORDER
This matter was originally scheduled for a hearing before an
ALJ. The parties subsequently waived oral hearing and agreed
decision should be issued on the basis of stipulations, appended
exhibits and briefs. In her January 7, 1992 decision and order,
the ALJ stated that it was "clear that [North Star] attempted at
all times to comply with the law and also attempted by its attorney
to amicably resolve the dispute," and that the Department of Labor
had apparently appreciated that fact, since the Department did not
seek debarment of North Star.
The ALJ went on to state that the real question in the case
was "what constitutes certification by a State Agency within the
meaning of [sec] 5.5(a)(4)(i) and [sec] 5.2(n)(1)(ii) of the
regulations and when must such certification be made." The ALJ
observed that regulatory provisions indicate that an individual who
is not `individually registered' in the program is one who has been
certified . . . to be eligible for probationary employment as an
apprentice." (Original emphasis.) That language, the ALJ stated,
"suggests that such certification of eligibility must be made by
the appropriate agency at or about the time the employee commences
his probationary employment."
The ALJ also addressed North Star's argument that the JAC
formally acknowledged or certified that each of the affected
employees was eligible as a probationary apprentice during the
first 90 days of employment. "While this formal certification is
undoubtedly the type of certification required by the relevant
regulations," the ALJ stated, "it was acquired long after the
probationary period expired." In addition, the ALJ turned aside
North Star's reliance on issuance of the intent to hire documents,
noting that "even if one were to accept that the intent to hire
document was a sort of informal certification of the individual it
could not be regarded as a knowing certification of each
individual's eligibility by the JAC" because the letters of intent
were issued in blank.
"To certify," the ALJ stated, "means to confirm formally as
true, accurate or genuine, to testify to or vouch for in writing;
to guarantee as meeting a standard." However, she added, in this
case the affected employees were not certified to be eligible for
probationary employment until a year or more after they were
employed as apprentices. "Such belated certification," the ALJ
stated, "cannot be substituted for the requirement of individual
registration."
The ALJ concluded that the affected employees were not
"apprentices" within the meaning of Section 5.2(n)(1), since they
were neither individually registered in a bona fide apprenticeship
program nor certified at or about the time they commenced
probationary employment. The ALJ ordered that the stipulated
amount of back wages owed be paid, minus intervening payments made
to three individuals. The amended amount of back wages totaled
$34,889.97. [5]
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[6] III. DISCUSSION
As noted earlier, the regulations of the Secretary of Labor
specify the circumstances under which an employee may be paid an
apprentice wage rate, rather than the journeyman rate listed in an
applicable wage determination. Thus, pursuant to 29 C.F.R.
5.5(a)(4)(i) an apprentice wage may be paid to an individual who
(1) is employed under and individually registered in a bona fide
apprenticeship program, or (2) is not individually registered but
is in the first 90 days of probationary employment and "has been
certified" by BAT or a state apprenticeship agency "to be eligible
for probationary employment as an apprentice." These requirements
are also reflected in 29 C.F.R. 29.3(c) and (d), which address the
procedures for individual registration of apprentices and
certification of eligibility for probationary employment. Section
29.3(c) specifies that individual registration is accomplished by
filing copies of each apprenticeship agreement or, with prior BAT
approval, filing a master copy of the agreement along with a
listing of the names and other required data regarding each
individual when apprenticed. Section 29.3(d) requires that the
names of individuals in the first 90 days of probationary
employment as an apprentice, if such individuals are not
individually registered, "shall be submitted immediately after
employment to the [BAT] or State Apprenticeship Agency for
certification to establish the apprentice as eligible for such
probationary employment."
Board precedent makes clear that the responsibility for
individual registration of apprentices lies with the employer. See
Tollefson Plumbing and Heating Co., WAB Case No. 78-17 (Sept. 24,
1979) (the employer, not the contracting agency, has the
responsibility for registering employees in a bona fide
apprenticeship program). We discern no basis for imposing a
different standard for the requirement that the names of
individuals in the first 90 days of probationary employment as
apprentices be submitted in a timely manner to BAT or the state
apprenticeship agency for certification of the individual as
eligible for probationary employment.
North Star argues that the crucial issue in this case is what
constitutes "certification" within the meaning of the Department's
regulations. When BAT is the certifying agency, however, the
Department's regulations are explicit as to the meaning of that
term: that is, certification is "written approval by the Bureau of
. . . [a]n individual as eligible for probationary employment as an
apprentice under a registered apprenticeship program." (Emphasis
supplied.) We think it reasonable to expect that certification by
a state apprenticeship agency would also be "written approval" or
an act of equal formality. That issue need not be definitively
addressed for purposes of this case, however, for the record is
devoid of evidence that employer North Star fulfilled its
obligation under Section 29.3(d) of submitting to the Oregon state
apprenticeship agency "immediately after employment" the names of
individuals in their first 90 days of probationary [6]
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[7]
employment as apprentices "for certification to establish the
apprentice[s] as eligible for such probationary employment."
To be sure, the record does contain an undated letter to the JAC
from North Star requesting that the affected employees be certified
that they "were eligible for probationary employment as apprentices
during their first ninety days of employment at North Star. . . ."
However, there is no evidence nor even an allegation that this
letter was submitted "immediately after employment" as required by
Section 29.3(d). Furthermore, the JAC did not respond to the North
Star letter until December 21, 1988 -- or, as the ALJ noted, about
a year or more after the affected employees were employed as
apprentices. Finally, as counsel for the Acting Administrator
properly observes (Statement, at p. 14), nothing in the record
"allow[s] for the conclusion that Area One JAC possesses the
authority to provide the requisite certification" which, according
to the Department's regulations, must be provided by the state
apprenticeship agency.
In short, for the foregoing reasons the petition for review is
denied, and the ALJ's decision and order is affirmed.
BY ORDER OF THE BOARD: Charles E. Shearer, Jr., Chairman; Ruth E.
Peters, Member; Anna Maria Farias, Member. Gerald F. Krizan, Esq.,
Executive Secretary [7]
