GREATER CINCINNATI BUILDING
& CONSTRUCTION TRADES COUNCIL
Dispute concerning the applicability of
the wage determination likely to be applied
to laborers and mechanics employed for the
residential renovation of the Alexandra
Apartments, 921 William Howard Taft
Rd., Cincinnati, Ohio
BEFORE: THE ADMINISTRATIVE REVIEW BOARD
Appearances:
For Petitioner Greater Cincinnati Building & Construction Trades Council:
Michael A. Ledbetter, Esq., Snyder, Rackay & Spicer, Dayton, Ohio
For Respondent Administrator, Wage and Hour Division:
Joan Brenner, Esq., Douglas J. Davidson, Esq., Steven J. Mandel, Esq., U.S. Department of Labor, Washington, D.C.
For Intervenors MV Communities, Alexandra Limited Partnership, and Associated Land Development, Inc. (collectively "Project Developers"):
Maurice Baskin, Esq., Venable LLP, Washington, D.C.
Our predecessor agency, the Wage Appeal Board (WAB), often addressed the timeliness requirement for challenging wage determinations. That Board explained the importance of timely wage determination challenges:
It is vital to ensure that contractors competing for federally-assisted construction contracts know their required labor costs in advance of bidding. Manifest injustice to bidders would result if the successful bidder on a project could challenge his contract's wage determination rates after all other competitors were excluded from participation.
The timeliness requirements are among the Board's longest-standing precedents concerning challenges to wage determinations and the Board has consistently endorsed the restriction against challenges which are untimely. Gananda Development Corporation, WAB Case Nos. 73-13 and 73-14 (May 14, 1977); Jordan & Nobles Construction Company, WAB Case No. 81-18 (Aug. 19, 1983); Kapetan Incorporated, WAB Case No. 87-33 (Sept. 2, 1988); M.A. Mortenson, supra, at 6-7.22
The Council clearly did not file timely challenges to the Administrator's October 26, 2001 final determination. The contract was awarded on November 1, 2001. Construction began on November 5, 2001. The Council made its challenges to the wage determination on December 28, 2001, and January 11, 2002. And because the exceptions to the general rule do not apply here, we find that the Council's challenges were untimely.23[Page 5]
Nevertheless, the WAB observed that it could neither ignore nor excuse the nearly three-month gap between the start of construction, May 17, 1993, and the union's August 9, 1993 request for reconsideration. Therefore, the WAB affirmed the Administrator's determination that the petitioners' request for reconsideration was untimely:
Petitioners should reasonably have been aware of the allegedly improper wage determination contained in the [contract] within a short time period after the start of construction. Certainly, they should have been aware of this situation sooner than twelve weeks after the start of construction. Wage determinations, after all, are required to be posted by contractors on the site of construction from the first day of work. 29 C.F.R. § 5.5(a)(1)(i). The record contains no evidence to conclude that this regulation was violated.31
6 The Department of Labor has distinguished four types of construction for purposes of making prevailing wage determinations: building, residential, heavy, and highway. See AR Tab O.
7 PB, Ex. A, p. 1. "Building" construction wage rates apply to apartment buildings five stories and higher. See AR Tab P. Wages and fringe benefits for most laborers and mechanics under the applicable "building" construction wage determination rates are higher than those under the "residential" construction wage determination. For instance, an electrician working on the Alexandra Apartment project is paid $22.55 per hour and $6.95 per hour in fringe benefits under the Hamilton County (Cincinnati) "building" rates compared to $12.50 and $3.27 per hour under the "residential" wage rate. Similarly, roofers receive $23.15 and $6.04 if the "building" rates apply but $16.85 and $2.37 under the "residential" wage determination. See AR Tab M and N.
10 Ranford's memo was sent to Peg Moertl, the City's Director of Neighborhood Services. Copies were sent to six other persons, presumably City employees, whose titles are not specified. Thus, apparently Ranford did not send this memo to anyone at the Building Trades Council. Furthermore, as of July 20 the City's Supervising Building Plans Examiner was not aware of Ranford's decision to classify the proposed Alexandra project as a five-story building. See AR Tab C.
11 AR Tab A. William W. Gross, the Department of Labor's Director of the Wage Determination Division, signed the letter. Gross is the authorized representative of the Administrator of the Wage and Hour Division. See 29 C.F.R. § 1.2(c). Gross sent the letter to Angus only although it indicates that "any other interested party may consider this letter to be a final determination . . ."
12 The Council does not dispute the Wage and Hour Administrator's assertion that construction began on November 5, 2001. See Administrator's Brief (AB) at 4; Petitioner's Brief (PB) at 5-6.
13 According to the contract, "The prevailing wage determination in accordance with the Davis-Bacon Act, if applicable, is attached hereto as Exhibit C." AR Tab E, para. 17. However, the Administrative Record does not contain "Exhibit C." The Administrator claims the residential wage determination for Hamilton County (Cincinnati), AR Tab M, was "included" in the construction contract. AB at 4. The Council does not dispute this.
14 Letter dated December 28, 2001, from Joseph D. Zimmer, Executive Secretary, Greater Cincinnati Building & Construction Trades Council to the Administrative Review Board. The Council characterizes this December 28 letter as a "petition for review."
16Miami Elevator Co., ARB Nos. 98-086/97-145, slip op. at 16 (Apr. 25, 2000), citingDepartment of the Army, ARB Nos. 98-120/121/122 (Dec. 22, 1999) (under the parallel prevailing wage statute applicable to federal service procurements, the Service Contract Act, 41 U.S.C.A. § 351-358).
17Titan IV Mobile Serv. Tower, WAB No. 89-14, slip op. at 7 (May 10, 1991), citing Udall v. Tallman, 380 U.S. 1, 16-17 (1965).
18 "For purposes of this section, the term interested person is considered to include . . . any labor organization which represents a laborer or mechanic, who is likely to be employed or to seek employment under a contract containing a particular wage determination . . . ." 29 C.F.R. § 7.2 (b)(1). We assume without finding that the Greater Cincinnati Building & Construction Trades Council is an "interested person" in this case.
20 29 C.F.R. § 1.9. The rules of practice before the ARB contain a similar provision. See 29 C.F.R. § 7.2(a). We note that the Council's Petition for Review to the ARB is dated December 28, 2001. However, the Council's request to the Administrator for reconsideration of the final determination is dated January 11, 2002. Section 1.9 (and 7.2(a)) requires that, before filing a petition with the ARB, an interested person must first seek reconsideration by the Administrator and be denied. Therefore, the Council's Petition for Review is not properly before us. Nevertheless, to avoid injustice and in the public interest, we will proceed to decide this dispute. See 29 C.F.R. § 7.1(c) ("In exercising its discretion to hear and decide appeals, the Board shall consider, among other things, timeliness, the nature of the relief sought, matters of undue hardship or injustice, or the public interest.").
21 29 C.F.R. § 1.6(c)(3). The residential wage determination incorporated into the Alexandra construction contract is a "general" wage determination rather than a "project" wage determination. Therefore, section 1.6(c)(3) applies. See AR Tab M. Section 1.6(c)(3) applies to "actions" taken by the Department of Labor. The Department, not interested persons, actually modifies wage determinations and publishes its actions. Since these governmental activities must occur before the contract award or start of construction in order for a modification to be effective, requests or petitions for this "action" must necessarily occur before contract award or start of construction. See Modernization of the John F. Kennedy Fed. Bldg., Boston, Mass. ("JFK I"), WAB No. 94-09, slip op. n.5 (August 19, 1994).
23 As already indicated, the exceptions listed in section 1.6(c)(3)(i)-(iv) do not apply. Section 1.6(d) (Administrator may correct a wage determination if it contains clerical errors) is not applicable. Section 1.6(f) permits the Administrator to issue a wage determination after contract award or start of construction if: 1) no wage determination was initially included in the contract; 2) a wage determination that clearly does not apply was used; or 3) the wrong wage determination was used because the agency's request for the wage determination was based on an inaccurate description of the project or its location. The Council does not contend that any of the 1.6(f) exceptions apply. Moreover, we agree with the Administrator that these exceptions do not fit the facts of this case. See Administrator's Brief (AB), p. 7-8.
36 The situation here is somewhat analogous to the facts in JFK II. There the WAB found that given their participation in earlier phases of the construction project, the unions' very late filing could not be excused because they "certainly were on notice of the need to confirm that the proper wage determination was actually incorporated into the [contract]." See JFK II, slip op. at 4.
38 The Council asserts that because the Administrator indicated that his October 26, 2001 final determination was in accordance with 29 C.F.R. § 5.5(a)(1)(ii)(C), the City, as contracting officer, was required to "serve the Administrator with the views of all interested parties." PB at n.1. Had the City done so, the Council appears to argue, the Administrator would have sent the October 26, 2001 final determination letter to the Council thus putting it on notice that the residential rates were applicable. However, we agree with counsel that the Administrator's reference to section 5.5(a)(1)(ii)(C) was inadvertent and obviously incorrect. As this regulation clearly applies to the conformance process, never an issue in this case, the Council cannot rightfully seize upon the Administrator's inadvertence and claim it was excluded from the review process. See AB at n.3.
39 "Both the City of Cincinnati and the developers knew the Petitioner was an interested party, and yet they decided not to inform the Council of the August 16, 2001 letter to Director Gross, or his subsequent October 26, 2001 decision . . . . The potential for the abuse of the wage determination process by contractors and municipalities . . . is too great to allow for rigid application of the timeliness rule. Ignoring the potential for abuse would not serve to further the remedial purposes of the Davis-Bacon Act, and would encourage manipulation of the regulations to avoid paying working men and women the wages to which they are entitled." PB at p. 6.
40See JFK II, slip op. at 4. General Wage Determination Number OHO10004, Modification 2, dated November 16, 2001, for residential construction (AR Tab M), was incorporated into the construction contract. Thus, the Council should have been aware, by November 16 at the latest, that its members working on the Alexandra project were being paid at the residential wage rate. Furthermore, by November 16, this residential wage determination would have been posted "in a prominent and accessible place where it can be easily seen by the workers." See 29 C.F.R. § 5.5(a)(1)(i).
42 "All questions relating to the application and interpretation of wage determinations . . . shall be referred to the Administrator for appropriate ruling or interpretation." 29 C.F.R. § 5.13.
Following telephone discussions with various Wage and Hour staff, you were provided a copy of the criteria, published in the Davis-Bacon Construction Wage Determinations Manual of Operations, we consider when making a determination as to whether a structure is more or less than four stories in height. The exterior height of residential buildings in terms of stories is a primary consideration. In this regard, when the structure is more than four stories it is considered to be building construction.