HOMER L. DUNN, DECORATING, INC., 1982-DBA-24 (ALJ July 19, 1985)
CCASE:
HOMER L. DUNN, DECORATING
DDATE:
19850719
TTEXT:
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[1] [87-03.WAB ATTACHMENT 1 OF 2]
U. S. Department of Labor Office of Administrative Law Judges
211 Main Street - Suite 600
Commercial (415) 974-0514 San Francisco, California 94105
Government 8-454-0514
In the Matter of
HOMER L. DUNN, DECORATING, INC. CASE NO. 82-DBA-24
HOMER L. DUNN, President and
Owner,
Respondents.
Eric R. Yamamoto, Esq.
924 Westwood Boulevard, Suite 830
Los Angeles, California 90024
For the Respondents
Herbert Jay Klein, Esq.
United States Department of Labor
Office of the Solicitor
Federal Office Building, Room 3247
300 North Los Angeles Street
Los Angeles, California 90012
For the Department of Labor
Before: VIVIAN SCHRETER MURRAY
Administrative Law Judge
DECISION AND ORDER
This proceeding arises as result of the issuance of an Order
of Reference by the Administrator of the Wage and Hour Division of
the United States Department of Labor charging the respondents
Homer Dunn Decorating, Inc. and its President, Homer L. Dunn with
violations of the Davis Bacon Act, 40 U.S.C. [sec] 276(a) et seq.;
the Contract Work Hours and Safety Standards Act, 40 U.S.C. [sec]
327 et seq. and the Copeland Anti-Kickback Act, 40 U.S.C. [sec]
276(c) with regard to the employment of painters under nine federal
painting contracts between 1978 and 1980. Such contracts required
that the respondents pay to the painters employed on the projects
not less than the prevailing wage rate, as determined by the
Secretary of Labor or his authorized designee, in each respective
locality where the work was performed. All of the contracts were
subject to the provisions of the Contract Work Hours and Safety
Standards Act, which required the payment of overtime for any work
on the contracts in excess of 8 hours per day or 40 hours per
week.[1]
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[2] A formal hearing was held on June 6 & 7, 1984 in Los Angeles,
California, at which time the parties were respectively represented
by legal counsel.
The issues presented for decision are whether the respondent
failed to compensate specified employees in accordance with the
applicable wage for the classification of work performed for all
hours worked under the specified contracts and whether on two of
the nine contracts, kickbacks were demanded of specified employees.
The parties have stipulated and I accept that with regard to
the certified payroll in each instance the employees named on the
certified payrolls received checks in the sum stated on the
certified payroll; that all workers received checks in the amount
shown on such payrolls; that all employees negotiated such checks
and that all such employees were in the same job classification.
The evidence will show that a preponderance of the workers
affected by the wage violations were Vietnamese, who were
relatively recent arrivals in this country, who needed to work, had
significant language problems, were unaware of the prevailing wage
rate as determined by the Department of Labor, or otherwise unaware
of their rights under the law and were primarily concerned with
keeping their jobs. The government presented the testimony of
eight such witnesses. The testimony of Mr. Visessmith was credibly
supported by daily calendar notations showing the hours worked, the
pay received, the amount of kickback paid on the Las Alamitos
Contract and the dates such payments were made. Although the
witness Visessmith is presently a competitor of the employer, he
was a reluctant witness, who testified and brought forth the
calendar in evidence only subsequent to advisement that a subpoena
would issue if he did not do so. (Govt. Ex. 5). The witness
credibly testified that the calendared notations were made on a
daily basis and such testimony is unrefuted. This witness was
manifestly nervous. Another witness Mr. Viboolchan, who was also a
credible witness, testified that on the morning of the day he
testified, the wife of Veera Taveekanjana (Jimmy) called his home
when he was not present and advised his mother to advise him not to
testify. It is my impression that the witness considered the
message a threat and in this context such interpretation is
reasonable.
Respondent presented testimony of five witnesses, including
Mr. Dunn, his foreman Jimmy, who is alleged to have collected the
kickbacks, that of Mr. Lacy who has worked on and off for the
respondent since 1960, was a supervisor, long time friend of Mr.
Dunn and his current employee. Mr. Yuriar, the fourth witness, is
of Spanish extraction and Mr. Gindadoumrongvarich (Jack), although
Vietnamese, currently works for the respondent. With regard to the [2]
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[3] latter employee, the substance of his testimony and the
manner with which it was given persuades me that under no
circumstances would this witness give testimony detrimental to his
employer or employer's foreman.
The testimony of the Compliance Officer, Mr. Vineyard,
indicates that his investigation was carried on between July 1980
and January 1981. He attempted in all instances to interview 90%
of the employees on each contract, either personally or by
questionnaire. Ninety per cent of the employees were not
interviewed but failure was due to inability to locate the
employees, despite the fact that reasonable effort had been made to
do so. Such efforts were impeded by failure of some employees to
have a listed telephone number and by the nature of their work
activity which causes them to move about frequently and
occasionally to temporarily reside at their job sites. As review
of the individual contracts will indicate errors were made on
several occasions and were promptly admitted by the compliance
officer. Corrections consistent with those admissions have been
made, whether by the compliance officer or myself and will be noted
at the time the relevant contract is reviewed. It will be noted
that not all of the witnesses who testified for the government were
interviewed by Mr. Vineyard.
With regard to the Edwards Air Force Base Contract of May 1979
(Govt. Ex. 6), the government alleges a violation in the
respondent's failure to compensate overtime hours for nine workers
at the appropriate rate. The total amount of underpayment claimed
is $162.54 representing $18.06 for each of nine workers,
refer[]able to 1.5 hours of overtime. On this contract Mr. Vineyard
interviewed four of nine employees, and six of that number
testified including Mr. Gindadoumrongvanich, whose testimony as a
whole I do not credit for reasons previously stated. However, of
the remaining five witnesses presented by the government only Mr.
Tavantana clearly maintained that he worked additional time. The
other witnesses were either unsure or denied working additional
hours. Among that number was Mr. Visessmith who had kept a daily
record of his hours. He made no claim for overtime. Mr. Zookzwad
did testify, as respondent alleges, that on one or two occasions,
if his check was short on hours, he had only to request the
respondent to make the necessary adjustment and it was done. It
was not clear that such testimony necessarily referred to this
contract and additionally it says nothing about employees who did
not carefully record their hours and/or did not request an
adjustment. The bulk of the evidence however and the most credible
evidence supported by daily recordkeeping, that of Mr. Visessmith
does not support the government's contention on this contract even
allowing for a certain vagueness of the testimony of the witnesses [3]
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[4] because of the passage of time. Accordingly, and consistent
with a preponderance of the credible evidence, I find that the
government has not established overtime violations on this contract
and accordingly dismiss this claim.
With regard to the Edwards Air Force Base Contract of October
1979, the government claims failure to pay the prevailing wage rate
and overtime violations. Mr. Vineyard interviewed six out of the
twelve witnesses for whom the claim was made and seven out of
twelve testified. The claims are supported by the testimony of the
witnesses as well as the material given on interviews and by Mr.
Visessmith's calendar. (Gov. Ex. 2). It is established that
claims are not made for the entire crew, which consisted of
eighteen men. That does not necessarily invalidate the
government's claim. The evidence herein indicates that the
affected parties were primarily the vul[]nerable Vietnamese. I find
that the bulk of the credible evidence supports the government's
claim with regard to this contract, notwithstanding the testimony
of Mr. Rajpreja, who testified from memory that he worked an eight
hour day. The testimony of the respondent's witnesses is not
persuasive, and if credited would absolve the respondent of all
wrongdoing, which is inconsistent with the bulk of the credible
evidence. Accordingly, I find that a preponderance of the evidence
establishes the government's claim of violations with regard to
this contract. It should be noted that such violations are
established not only by the testimony of the witnesses but by the
interviews conducted by Mr. Vineyard at the relevant times.
With regard to the El Segundo Air Force Base Contract of
November 1978 (Govt. Ex. 8), the government claims failure to pay
the prevailing wage rate and overtime to certain employees. Mr.
Vineyard interviewed eight of the twelve employees for which the
claim is made and five of twelve testified, notwithstanding
argument of counsel for the respondent, Mr. Zookzwad's testimony
that he received adjustments for short hours has no affect with
regard to this contract. No claim for overtime was made for Mr.
Zookzwad the claim was for failure to pay the prevailing hourly
wage. I also note that adjustments carried over to the next pay
check should be reflected in respondent's books and records. Such
evidence would be of advantage to the respondent but has not been
presented. Overall, I find that the evidence presented by the
government both by way of interview and by testimony supports the
government's contention of violations in support of the total
amount of underpaid wages of $5669.92.
With regard to the contracts at Los Alamitos in November 1978
(Govt. Exs. 9, 10), the government alleges the respondent's failure
to pay the prevailing wage to two workers, in the respective total
amounts of $403.68 and $371.04. Such claims of violation clearly [4]
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[5] resulted from the failure of the compliance officer to
recognize that while each of the workers worked eight hours on
November 15, 22, and 29 they worked four hours in Building 42 and
the remaining four hours in Building 206, on each of those days.
This is reflected on the face of the relevant records and is
additionally supported by the November 1978 calendar of Mr.
Visessmith, which indicates work of approximately eight hours on
each of the days in question. Mr. Vineyard promptly admitted his
oversight at the time of hearing. (Tr. 347). Accordingly, the
government's claims with regard to both contracts are dismissed.
With regard to the Los Alamitos Contract of October 1980
(Govt. Ex. 11), a prevailing wage and fringe benefit claim is made
for two Spanish workers, Arerras and Rodriguez, who were allegedly
paid $50.00 for an eight hour day, rather than the prevailing wage
rate and for the remaining fifteen specified workers a claim is
made for kickbacks. All of the government's witnesses with the
exception of Mr. Amasuda, testified that they were required to
kickback wages and did so in the belief that they would lose their
jobs if they did not. The thrust of the testimony was that such
payments were made to Mr. Taveekanjana (Jimmy), the respondent's
foreman. Mr. Visessmith's calendar for 1980 indicates kickback in
round numbers of $139.00 on October 8; $155.00 on October 22 and
$175.82 on November 13, for a total of $469.82. (Tr. 377).
Several of the witnesses testified that they had discussed these
kickback payments among themselves and had seen other workers
making such payments. The testimony of the government's witnesses
and those of the respondent are in direct conflict. With the
exception of the two workers of Spanish extraction for whom
underpayment of the prevailing wage is claimed, $522.00 is claimed
due for each of the remaining fifteen. Mr. Vineyard explained that
this figure, which exceeds the total amount of kickbacks recorded
by Mr. Visessmith, is the result of his taking into consideration
the varying amounts which workers other than Mr. Visessmith claimed
to have kicked back; totalling of the whole and dividing such total
to arrive at an average figure.
The respondent's witnesses Dunn, Jimmy the foreman, Lacey a
long time friend of Dunn, Yuriar who currently works for Dunn and
Gindadoumrongvarich, (Jack) all denied the payment of kickbacks.
According to Jimmy, the foreman he posted the prevailing wage
rates at every site the first day that he commenced a job. His
testimony is discredited by a showing that on this particular job,
the requisite Notice (Govt. Ex. 1), was not posted when the project
site was inspected on 10/1/80 although the job had commenced on
September 30. (Govt. Ex. 15). Additionally although Mr.
Vilboochan did not work on this project, I accept his testimony [5]
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[6] that Jimmy was responsible for delivering a veiled threat in
an attempt to deter that witness from testifying at hearing and it
was further my observation that the foreman's presence tended to
intimidate and frighten the Vietnamese witnesses who testified at
hearing. I do not find the foreman, Jimmy credible. As far as
Mr. Lacey's testimony applies to himself, I am inclined to accept
it, believing that this long time friend of the respondent was not
asked to kickback any of his earnings from this project. Counsel
for the respondent argues that the testimony of Mr. Tavantana, who
was the only witness who alleged that anyone but Jimmy collected
the kickback money, is not credible and is sufficient to discredit
his testimony. I do not credit Mr. Tavantana's testimony to the
extent that it indicates that secretaries actually collected
kickbacks or that anyone other than Jimmy collected kickbacks, but
I do not find that such deficiency rebuts the overall evidence of
kickbacks.
I believe that many of the witnesses who testified in the
presence of the foreman Jimmy were fearful of him even where they
did not continue to work for the respondent. The witness Jack, who
does continue to work for the respondent was so nervous and
frightened when he testified that he provided the wage rates on two
contracts before he had even been asked that question. A certain
amount of tension on the part of witnesses who are not familiar
with legal proceedings is not unusual. However, the tension and
fear manifested by these witnesses was significant and far exceeds
the upper limits of what might be considered normal in the
circumstances. Counsel also argues that the witnesses Tavantana,
Visessmith, Zookzwad and Chumnikai, are principals or employees of
T&V Painting, a business established without respondent's knowledge
and in competition with him for certain contracts. The implication
is that their testimony is motivated by self interest, apart from
the money they may receive. However, Mr. Visessmith was a most
reluctant witness, whose testimony is supported by a written
record, made at the relevant time and not discredited here. I
consider that these witnesses, none of whom appeared anxious to
testify, probably were motivated, in part at least, by the
realization that a competitor, who does not pay the prevailing wage
to all of his workers or requires kickbacks and succeeds in doing
so with impunity will be able to underbid any competing firm that
abides by relevant law. Such motivation is not improper and does
not subvert but supports the intent of the legislation /FN1/.[6]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN1/ See, Repp & Mundt, Inc./Cordile Plumbing and Heating Co., 79
DB 187 (1/14/80), citing Sen. Report No. 963, 88th Cong. 2d
sess. (1964), U.S. Code Cong. and Adm. News at 2340. [6]
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[7] Considering the evidence presented and the credibility of the
respective witnesses, I find that the government has established
that the workers on this project were required to remit or kickback
a portion of their wages periodically.
Counsel for the respondent argues that Mr. Vineyard's failure
to accept the evidence presented by Mr. Visessmith with regard to
the amount of the kickback and rejecting it in favor of an average
is unacceptable. While I credit the testimony of the government's
witnesses and accept that kickbacks were made periodically and
collected by the foreman Jimmy the testimony and evidence presented
the government other than Mr. Visessmith tended to be vague as to
amount and time of kickbacks. The government by its attorney
acknowledges as much and pleads the background of such witnesses,
their obvious fear, the difficulties imposed by their unfamiliarity
with the language as well as the passage of time and its effect on
memory as excuse for testimony which is vague and sometimes
inconsistent. Considering these factors, as I have, I nevertheless
find that the government's claims are properly limited by the most
reliable evidence which it has presented. In sum, the government
has established periodic payments and collections by Jimmy at
specific times from groups of people in individual amounts
exceeding $100.00. The most specific probative and reliable
evidence presented on this point has been the testimony and
supporting documentation of the witness Visessmith. Considering
his hours worked on this project he could be expected by other
workers to have paid the maximum kickback. Lacking evidence to the
contrary, I can find no basis for assessing a higher total for each
worker based on an average of rather vague estimates, and in the
case of Mr. Visessmith, contrary to unrefuted evidence presented by
the government.
As the respondent pointed out, Mr. Amasuda testified that he
did not make any kickback, I accept that testimony. Mr. Amasuda
worked on this project one day during the first week ending October
1, 1980, and two days ending the week of October 8. He performed
no work thereafter and I do not believe that he was asked to
kickback any of his wages. An employer or his foreman may be
greedy but they are not necessarily stupid. Mr. Vineyard
apparently recognized that kickbacks were not made by all workers
since his claim for Mr. Arerras is for failure to pay the
prevailing wage, although Mr. Arerras was on the project from the
week ending October 29 through November 5. It is unreasonable to
attempt to obtain a substantial kickback of wages from employees
who have worked an insignificant period of time and illogical to
claim that they have made kickbacks at a period of time when they
were not even present. The two Mr. Flores, for example, performed
work on the project between the week ending 11/12 and the week [7]
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[8] ending 11/19. Each of them worked two days during the first
week and one and one half days during the second week. Neither was
present on October 8 or on October 22. The testimony is that Jimmy
went around to workers showed each of them a piece of paper,
indicating the amount of kickback that they should make. Mr.
Chumnikai, Mr. Rajpreja, Mr. Tavantana, Mr. Visessmith and Mr.
Zookzwad, who testified to making kickbacks, all worked a
significant period of time on this project, a preponderant number
of them commencing work on September 30 and ceasing on or about
November 12.
Considering all factors and giving full credence to the
government's evidence to the extent it is consistent with common
sense and logic, in this context, I find that the maximum amount of
kickback payment to each worker entitled thereto is limited to the
amount claimed by Mr. Visessmith which is $469.82. I find that
neither Mr. M. Flores nor Mr. S. Flores who worked a total of three
and a half days on this project could reasonably be believed to
have made or been requested to make a kickback of their wages and
accordingly discount their claims along with that of Mr. Amasuda
for the same reason. That finding is consistent with Mr. Amasuda's
testimony but that is not the primary reason for discounting it.
An employee cannot waive or bargain away the payment of wages and
rights secured to him by law. Brooklyn Savings Bank v. O'Neil, 324
U.S. 697, 702, 65 S.Ct. 895, 900 (1945). All other workers for
whom a claim for kickback was made are found to be due $469.82.
With regard to Mr. Arerras and Mr. Rodriguez, I find that
there is sufficient evidence to establish that they were not paid
the prevailing wage rate and are accordingly entitled to the
amounts claimed by the government. I also find that with regard to
Mr. Bill Lacy, the longtime friend of respondent-President, Mr.
Dunn that a claim is not properly made. Mr. Lacy denies such
payment and I do not believe that any attempt was made to exact a
kickback from him.
Accordingly, the total amount of the claim made by the
government on this contract is reduced to $6255.02 consistent with
the above findings.
I note that while the respondent claims that it was improper
for the compliance officer to claim a kickback payment for Mr.
Gindadoumrongvarich (Jack) because the witness denied having made
such payment I do not concur. The witness' testimony is not
credited. I believe his denial was the result of fear that he
would be discharged had he given contrary testimony and since he is
unable to waive his rights under the law the claim is properly made
for him. [8]
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[9] The respondent argues that the acceptance of, or the demand
for kickbacks is an illegal activity and as such is outside the
scope of any agency. The charge against Mr. Dunn and his foreman
is not a criminal charge in this forum but is treated as a civil
matter requiring the respondent, if found guilty of the violation,
to reimburse the workers. Mr. Dunn testified that he knew nothing
of any kickbacks until informed by the government. However, when
so informed he testified that he made an investigation and
conducted that investigation by inquiring of his employees in the
presence of the man who is alleged to have collected the
kickbacks. By his own testimony, that was the extent of his
investigation, and in this context given the background and the
circumstances of these workers, no reasonable man could expect that
such inquiry would be fruitful or would increase his knowledge of
the situation one iota. Mr. Dunn's failure to conduct an inquiry,
reasonable in scope, and design for its purpose indicates at least,
a preference for ignorance of a type which is repugnant to the
relevant law and its intent. The result achieved by the
respondent's inquiring was, in the circumstances, for[e]seeable and
was assured by the nature of the inquiry conducted in the foreman's
presence. A reasonable man who really wanted to know whether his
employees were being required to kickback wages would not have
proceeded in such fashion. The inference arising from such conduct
is that the respondent, Mr. Dunn, knew of his foreman's activity
and did not want to be told so by the workers.
The HUD Contract of June 1979 (Govt. Ex. 12), is a claim for
failure to compensate for overtime at the prevailing rate, Mr.
Vineyard interviewed three out of the three workers and one of that
number testified. Mr. Vineyard acknowledged that he made a
miscalculation in computing the amount due Mr. Roberson although he
attributed this in error to the El Segundo Contract (Govt. Ex. 12;
Tr. 345), rather than to the HUD Contract. However, he failed to
carry the recalculated figure of $463.99 to the first page of
Exhibit 12 or to deduct that from the total claimed by the
government for the three workers. The corrected total for this
contract is therefore $833.60 as opposed to $1160.43. I find that
the evidence presented by the government in support of the alleged
violation is sufficient to establish that the workers are due the
following wages, Mr. Rajpreja, is due the amount of $38.18, Mr.
Roberson, the amount of $463.99, and Mr. Taylor the amount of
$331.43.
On the HUD Contract for Lincoln Apartments, Riverside, May
1979 (Govt. Ex. 13), the government alleges that the respondent
failed to pay overtime at the prevailing rate, as Mr. Visessmith
calendar indicates for the number of overtime hours worked on May
22 and 23, 1979 (Govt. Ex. 3). The workers commenced and ceased [9]
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[10] work at the same time and the claim is accordingly made for
all workers. The testimony of Mr. Vineyard, the Compliance Officer
with regard to the employees interviewed and the calendar of Mr.
Visessmith is I find sufficient evidence to support the
government's contention with regard to this contract. The total
amount due is $144.90.
The China Lake Contract of August 1979 (Govt. Ex. 14),
involves alleged violations for kickbacks and overtime. The
workers worked as a crew. The testimony of the government's
witnesses was overwhelmingly to the effect that kickbacks were
demanded by the employer's foreman and were paid by the workers.
The compliance officer determined the amount of the kickback not in
a lump sum or as to any particular time but apparently believed it
to be approximately equivalent to $3.13 an hour or roughly $25.00
for forty hours of work. Respondent objects to the manner of
computation which was computed as if the prevailing wage had not
been paid. That is not established and I agree with the respondent
that there is no indication on this contract that the prevailing
wage was not paid. In other words, the workers were paid the
amount of the prevailing wage but were then required to kickback a
certain sum. The compliance officer apparently believes that the
amount kicked back was equivalent to $3.13 or $25.00 for forty
hours worked. The testimony of the witnesses on the China Lake
Project in 1979 is much the same as it was on the Los Alamitos
Project in 1980.
The prevailing wage rate on the Los Alamitos Project in 1980
which was a later contract was $16.95 per hour while the prevailing
wage on this contract in 1979 was $14.13 per hour. If one looks at
a forty hour work week for the present China Lake Project the
amount computed by the compliance officer for the amount of
kickback would be roughly 22% of a worker's earnings for forty
hours. Comparing the evidence presented on the Los Alamitos
Project, which showed that the lump sum kickbacks paid by Mr.
Visessmith were paid approximately every two to three weeks during
the course of that contract it will be seen that the payments made
are roughly equivalent to 11% of earnings in the case of a forty
hour work week. Considering that the testimony of the witnesses as
to the amounts kicked back was roughly the same as it was on the
Los Alamitos Project and that the prevailing rate on the Los
Alamitos Project is almost $3.00 per hour greater than the
prevailing wage rate on the China Lake Project the amounts claimed
as overpayments appear unlikely in this case where there is no
credible documentation of the lump sum amounts kicked back or
agreement on all dates when such demands were made. That does not
invalidate the claims if the evidence is sufficient to establish
violation and sufficient overall to determine within a reasonable
degree of certainty the sums kicked back. [10]
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[11] The legislation is designed to protect the workers not the
employers and certainly the testimony and the determinations of the
compliance officer are entitled to great weight where they are
reasonable in the entire context of the claim. With regard to this
contract there is however a lack of consistency (as to amounts
kicked backed by the worker) between the testimony of the workers
at hearing and the investigative reports relied on by the
compliance officer. Given the testimony at hearing and weighing it
in light of the evidence presented overall and common sense, I
consider it unlikely that the kickback demands on this project
exceeded those made on the later Los Alamitos Project for reasons
previously indicated.
The method of calculating the amount of kickback based on
Hastanand's statement above, which is in part inconsistent is not
reasonable. Granted that the compliance officer was faced with
significant difficulties in this case, Hastanand did state that he
was paid the prevailing wage initially (Tr. 383, 384). Payment was
made by check. There is no evidence that such checks were not
negotiated by the workers which suggests that kickbacks were
subsequently paid on demand rather than deducted or paid on
presentation of the check. Mr. Zookzwad's testimony supports that
interpretation (Tr. 95) this witness also appears to have mixed his
recollection of work on the Los Alamitos Project with that of China
Lake since he later testified that he saw Visessmith make kickbacks
on this project (Tr. 96) and recalled rooming with him (Tr. 97).
Mr. Visessmith did not work on the China Lake Project. The fact
that Mr. Zookzwad contradicted his prior testimony in part when
cross examined (Tr. 121, 123) does not improve his credibility.
Hastanad did not testify at hearing and his father's testimony
provided little reliable support for the government's position.
In sum, I am persuaded only that kickbacks were demanded and
paid on this project. The evidence however does not support the
method of calculation or the amount calculated.
It was on this contract that Mr. Dunn was first advised that
there were kickbacks being demanded of the workers and as
previously stated his investigation was grossly inadequate and
certainly not designed to discover any irregularities, but rather
to assure that none would be discovered. Had Mr. Dunn conducted a
proper investigation at this time with negative results I would, on
the evidence presented, dismiss all violations alleged on the China
Lake Project as respondent's counsel urges. However, a clear
inference arises from Mr. Dunn's negligence which must be viewed as
intentional in the circumstance and consiStent with knowledge of
the kickback violations alleged. Viewing this incident in its
overall context, I consider, for reasons previously indicated, that
the kickbacks demanded on this project were very likely less than [11]
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[12] or equivalent to the kickback demands made on the
subsequent Los Alamitos Project. It would be contrary to reasonable
expectation if the earlier demands were greater than those later
made, and in the absence of reasonably reliable evidence to the
contrary, I find that the kickback demands on the China Lake
Project were equivalent to what was demanded on the Los Alamitos
Project one year later, I find therefore, that the total amount of
kickback paid by each worker in the instant case, is properly
deemed to be equivalent to the total amount kicked back by each
worker on the Los Alamitos Project ($469.82) (Tr. 377). A reduction
in kickback demand on the later project would be contrary to
reasonable expectation.
In regard to the overtime violation, the overall evidence
indicated that the workers on the Navy Installation commenced and
ceased work at the same time arriving and leaving in a body
consistent with base security and comparable to that which took
place on the Los Alamitos Army Base Project. I must agree with
respondent that the government has not presented acceptable
evidence of overtime violations, on this contract.
The compliance officer interviewed Mr. Hastanand who reported
being paid the prevailing wage rate but subsequently having to
kickback part of the wages such that actual wages retained
approximated $11.00 per hour. (Tr. 383, 384). The compliance
officer accepting that the gross amount of wages paid was correct
and relying on Hastanand's assessment of $11.00 per hour and
allegation that he also worked overtime for which he was not paid,
divided the gross amount of wages paid, by $11.00 per hour to
determine the amount of overtime hours worked (Tr. 388, 389). This
method of determining overtime is obviously faulty. The evidence
in support of any overtime on this military project is unreliable,
and unpersuasive. Considering all factors, it seems more likely
that no overtime was worked on this military project just as none
was worked on the Los Alamitos Project but in any event, the
evidence presented by the government does not sustain the charge
for overtime and the claims made therefore are hereby dismissed.
I conclude that the respondent has violated the Davis Bacon
Act, the Contract Work Hours and Safety Standards Act and the
Copeland Anti-Kickback Act to the extent above indicated, is
subject to debarment, and shall make payment on the following
contracts in the amount indicted below consistent with the
decisional findings.
Contract #F04700-79-M-0113
Edwards Air Force Base $ 3,924.25
Contract #F04693-78-C-0023
U.S. Air Force, El Segundo 5,669.92 [12]
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[13]
Contract #DAHA04-80-C-0090
Armed Forces Reserve Center,
Los Alamitos 6,255.02
Contract #122-79-502
HUD PRO VI, La 833.60
Contract #122-79-498
Lincoln Apartments,
Riverside 144.90
Contract #N62474-79-C-0276
China Lake, U.S. Navy 3,288.74
$20,116.43
Wherefore, it is ordered that the respondent pay the sum of
$20,116.43 to the Employment Standards Administration, U.S.
Department of Labor for distribution to the specified employees in
the specified amounts indicated in this decision. Any moneys not
distributed to said employees within three years from the date of
receipt thereof by the Employment Standards Administration, because
of inability to do so, shall be covered into the Treasury of the
United States as miscellaneous receipts.
Dated this 19th day of July, 1985 at San Francisco,
California.
VIVIAN SCHRETER MURRAY
Administrative Law Judge
VSM:brt [13]
