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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D.C.
In the Matter of:
NORSE, INC. Prime Contractor Case No. 95-05
BOB HULL INTERIORS, INC.,
Subcontractor
With respect to conformed classifications
under Wage Determination No. WA93-0007
applicable to Contract No. DACA67-93-0050
for installation of resilient floor covering at the
parachute training facility, Fairchild Air Force base,
Spokane County, Washington
BEFORE: David A. O'Brien, Chair
Karl J. Sandstrom, Member
Joyce D. Miller, Alternate Member
DATED: February 29, 1996
DECISION OF THE WAGE APPEALS BOARD
This matter is before the Wage Appeals Board on the petition
of Norse, Inc. (Norse) and Bob Hull Interiors, Inc. (Hull)
(collectively, Petitioners) for review of the March 20, 1995
final ruling by the Administrator, Wage and Hour Division. The
Administrator ruled Petitioner Hull's proposed $15.79 per hour
wage rate for a resilient floor covering installation worker
classification was not reasonably related to other wage rates
listed in the wage determination applicable to the captioned
contract for construction. The Administrator further ruled an
hourly rate [1][2] of $19.60 was appropriate under the
"reasonable relationship" requirement. For the reasons set forth
below, the Administrator's final ruling is affirmed.
I. BACKGROUND
On June 23, 1993, bidding opened on U.S. Army Corps of
Engineers (Corps) Contract No. DACA67-93-C-0050 for construction
at the parachute training facility, Fairchild Air Force Base,
Washington. Norse, Inc., was awarded the contract on July 28,
1993. Wage Determination (WD) No. WA930007 (with two
modifications) dated June 4, 1994 was included in the contract.
Administrative Record (AR) Tab G.
On March 10, 1994 through the contracting agency, Hull --
Norse's subcontractor -- submitted a conformance request for
authorization of an additional classification for a "Resilient
Floor Covering" classification at the wage rate of $15.79. AR
Tab C, Enclosure 1; AR Tab F, Enclosure). By letter dated August
10, 1994, Wage and Hour informed the Corps that the request could
not be approved because the proposed wage rate, including bona
fide fringe benefits, did not bear a reasonable relationship to
wage rates contained in the wage decision. AR Tab F. Wage and
Hour stated that it would accept a rate of at least $19.60 per
hour for all such workers from the first day they began working
on this project. Id. In a letter dated September 2, 1994 the
Contracting Officer informed Norse of Wage and Hour's disapproval
of the resilient floor covering worker wage rate requested by
Hull. AR Tab E, Enclosure 4.
By letter dated September 20, 1994, Norse forwarded to the
Contracting Officer Hull's response to Wage and Hour's denial.
AR Tab E, Enclosure 5. The response, dated September 12, 1994,
explained that since 1987 Hull had completed more than 26 similar
projects at Fairchild Air Force Base and Fairchild Hospital on
which it had paid resilient floor covering workers a wage rate of
$15.79 per hour. AR Tab C, Enclosure 6. Included with the
letter was documentation supporting Petitioners' position
including: 1) a letter dated February 12, 1990 from counsel for
Hull requesting approval of the $15.79 wage rate on another
project, Tab C, Enclosure 7; 2) a copy of the approval obtained
on March 19, 1990, Tab D; and 3) a copy of the most current
Washington State Prevailing Wage Rates, effective March 3, 1994,
showing a wage rate for this classification of $15.79 in 19
counties, including Spokane County. Tab D, Enclosure.
In a memorandum dated September 26, 1994, the Contracting
Officer forwarded to the Corps in Washington, D.C. a request for
reconsideration of Wage and Hour's denial of the requested wage
rate for the additional classification on the [2][3] Fairchild
contract. AR Tab C. This request was forwarded by the Corps'
office of Chief Counsel to Wage and Hour by letter dated October
3, 1994. Tab B.
In her final determination letter dated March 20, 1995, the
Administrator upheld Wage and Hour's initial denial of the
request to add to WD No. WA930007 a resilient floor covering
worker at the proposed rate of $15.79 per hour. AR Tab A. The
Administrator applied the regulations and Wage and Hour's
implementing policies that require the proposed rate for a
conformed skilled classification to have a rate higher than that
for unskilled laborer, except in conforming a class within a
clearly recognized group such as power equipment operators. See
M.Z. Contractors (I), WAB Case No. 92-06, Aug. 25, 1992.
Resilient floor covering workers do not belong within any such
clearly defined group.
The wage rate, including fringe benefits, listed for general
(unskilled) laborer in WD WA930007 is $19.41; the lowest rate for
a skilled craft that is above the general laborer wage rate on
that wage determination is $19.60 for the "painter"
classification. Accordingly, the Administrator reaffirmed the
position set forth in the August 10, 1994 letter which indicated
that the additional classification would be approved at a wage
rate of no less than $19.60 per hour.
Petitioners were notified of their appeal rights to the
Board in the March 20, 1994 decision. On April 21, 1995, this
petition for review was docketed.
II. DISCUSSION
Petitioners argue that $15.67 is the proper wage rate for
resilient floor covering workers because it is the prevailing
wage rate in the local area for that type of work. In support of
this position Petitioners cite the Administrator's approval of
the $15.79 rate in 1990 for similar work at the Fairchild Air
Force Base and Fairchild Hospital. Since 1987, according to
Petitioners, $15.79 has been the prevailing wage paid for
resilient floor workers on at least 26 occasions. In addition,
Petitioners submitted the most current copy of the Washington
State Prevailing Wage Rates which lists $15.79 as the prevailing
wage for this type of work.
Furthermore, Petitioners state that they employ
substantially more than 51% of the resilient floor covering
workers paid by the hour in Spokane County and the 19 surrounding
counties. Therefore, Petitioners maintain, they set the
prevailing wage. Petitioners' arguments are rooted in a mistaken
understanding of the conformance process, which is not a de novo
proceeding to retroactively determine prevailing wages. As the
Board stated in Clark Mechanical Contractors, Inc., WAB Case No.
94-17, Sept. 29, 1995:[3]
[4] The Administrator is not obligated or expected to
conduct a survey to establish the prevailing wage in
conforming classifications. The Administrator's
responsibility is only to establish a wage that bears a
reasonable relationship to those contained in the wage
determination. The fact that the prevailing rate for a
particular trade at the time of conformance is more or
less than the rate established by the Administrator is
largely irrelevant. [Id., slip op. at p. 4.]
Consequently, even if the Board were to accept Petitioners'
argument that it is the prevailing practice in Spokane County to
pay resilient floor covering workers at a lower rate than that at
which the Administrator conformed this classification, it would
not alter our decision.
The regulations governing conformance provide, at 29 C.F.R.
5.5(a)(1)(ii)(A):
the contracting officer shall require that any class of
laborers or mechanics which is not listed in the wage
determination and which is to be employed under the
contract shall be classified in conformance with [*]
the wage determination[*][*][emphasis added][*].
The Board has consistently rejected the argument that the
Administrator should look beyond the wage determination to
external evidence of the prevailing practice in the area. Tower
Construction, WAB Case No. 94-17, Feb. 28, 1995; Bryan Electrical
Construction, Inc., WAB Case No. 94-16, Dec. 30, 1994, slip op.
at 5. To do otherwise would be contrary to the express dictate
of the regulations and would transform the conformance process
into an alternative avenue for challenging the sufficiency of a
wage determination.
The relevant criteria for the Administrator to use in
considering conformance requests are set forth in 29 C.F.R.
5.5(a)(1)(ii)(A). On the facts presented here, the key
subsection is (3), which authorizes the Administrator to conform
a requested rate if:
[T]he proposed wage rate, including bona fide fringe
benefits, bears a [*]reasonable relationship[*] to the
wage rates contained in the wage determination
[emphasis added].
The Board has recognized the broad discretion vested in the
Administrator to select the rate at which a classification is to
be conformed. Tower Construction, supra, slip op. at p.5. The
Board has found the policy of Wage and Hour to conform rates for
missing skilled classifications to a level no less than the
lowest rate for a [4][5] skilled classification listed in the
wage determination to ordinarily be a reasonable exercise of that
discretion. We find no reason to stray from that course in this
case. The general (unskilled) laborer's wage rate in the
contract wage determination is $19.41. The "painter's"
classification with a wage rate of $19.60 is the lowest paid
skilled worker classification greater than the wage rate of the
unskilled laborer and, therefore, Wage and Hour in selecting
$19.60 as the conformed rate has followed its established and
reasonable practice.
Here, Petitioners' argument that the approved rate is too
high is in effect a challenge to the sufficiency of the wage
determination itself and is barred as untimely by the regulations
and numerous Board decisions. 29 C.F.R. 1.6(c)(3); Bryan
Electrical, supra at p. 6, citing Jordan and Nobles Construction
Co. & W.R. Pierce & Associates, WAB Case No. 81-18, Aug. 19,
1983. Adequate remedies for challenging deficiencies in wage
determinations are available, but corrective relief must be
requested prior to the award of a contract. It is well
established that the conformance process cannot be used as a
substitute for the obligation to timely challenge the correctness
of wage determination. Jordan and Nobles Construction Co. & W.R.
Pierce & Associates, supra; Rite Landscape Construction Co., WAB
Case No. 83-03, Oct. 18, 1983.
Alternatively, Petitioners request relief due to the fact
that issuance of the Administrator's final ruling was delayed
approximately one month beyond a 30-day time frame stated in the
conformance regulation. The Board has ruled in several cases
that the 30-day provision in 29 C.F.R. 5.5(a)(1)(ii)(B) is not
jurisdictional, and does not bar the Administrator from taking
action on a conformance request in accordance with the
substantive requirements of the regulations. Mike J. Thiel,
Inc., WAB Case No. 92-24, July 22, 1993, slip op. at 7-8; More
Drywall, Inc., WAB Case No. 90-02, Apr. 29, 1991), slip op. at 5;
and Swanson's Glass, WAB Case No. 89-20, Apr. 29, 1991, slip
op.4.
For the foregoing reasons, the Administrator's final ruling
of March 20, 1995 is affirmed.
BY ORDER OF THE BOARD:
David A. O'Brien, Chair
Karl J. Sandstrom, Member
Joyce D. Miller, Alternate Member
Gerald F. Krizan, Esq.
Executive Secretary[5]
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