TOMBIGBEE RIVER LOCK AND CANALS, WAB No. 71-02 (WAB June 1, 1973)
CCASE:
TOMBIGBEE RIVER LOCK AND CANALS
DDATE:
19710726
TTEXT:
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[1] UNITED STATES OF AMERICA
UNITED STATES DEPARTMENT OF LABOR
WAGE APPEALS BOARD
In the Matter of
WAB Case
The Determination of the Prevailing
Wage Rates Applicable under the No. 71-02
Davis-Bacon Act, as Amended, to a
Proposed Corps of Engineers Contract Dated: June 1, 1973
for the Construction of a Lock and
Canals on the Tombigbee River,
Gainesville, Greene County, Alabama
APPEARANCES:
Louis A. Fuselier, Esquire,
Fuselier, Hector & Ott,
Jackson, Mississippi
for the Petitioner [1]
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[2] [22 ADDITIONAL APPEARANCES OMITTED THROUGH
PAGE 3]
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[3] Mr. Alvin Bramow
for the Solicitor of Labor
Before: Stuart Rothman, Acting Chairman, Wage Appeals Board;
and Clarence D. Barker, Members
DECISION AND ORDER
On May 11, 1971, the Wage Determination Division of the
Department's Workplace Standards Administration issued Wage
Determination No. AK-16,762, at the request of the contracting
agency here involved, namely, the Corps of Engineers, setting forth
the classifications and corresponding wage rates then [3]
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[4] found applicable to a proposed contract for the construction of a lock
and canals on the Tombigbee River at Gainesville, Greene County,
Alabama. This particular contract (though part of the overall
Tennessee-Tombigbee Waterway undertaking, which will eventually run
largely through the State of Mississippi) consists solely of the
Gainesville locks and canals. This particular work, it is further
noted, is physically situated wholly in Greene County, Alabama.
On May 27, 1971, the Wage Determination Division, apparently
on further study of the matter, superseded Wage Decision AK-16,762
with AK-20,424. The latter determination contained wage rates
higher than those contained in the superseded decision (which
generally reflected highway construction rates). Wage Decision AK-
20,424 was generally based on the "Heavy and Railroad Construction
Agreement" negotiated by the Alabama Branch, Associated General
Contractors of America, Inc., Heavy Construction Section, and
various Building Trades Unions of Alabama covering a number of
Alabama counties, including Greene County. The Wage Determination
Division found these wage rates to be prevailing in Greene County
for the heavy-type lock and canals job in question.
When the Department, on June 7, 1971, confirmed Wage Decision'
AK-20,424, the Petitioner appealed to the Wage Appeals Board for a
review thereof, contending that the rates reflected in the original
Decision (AK-16,762) should be reinstated because they were
"representative of the rates paid for similar work and generally
prevailing in a number of projects in the Greene County area."
Because of time limitations, the Petitioner "reserved the right to
present supporting data, views, and arguments at the hearing to be
scheduled before the Wage Appeals Board." [4]
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[5] Prior to a hearing scheduled for June 21, 1971, a Motion to
Remand was received by the Board on June 17, 1971, from Counsel for
the Solicitor. In this Motion, it was pointed out that it had come
to the attention of the Administrator (Workplace Standards
Administration) for the first time that "no on-site survey had been
made recently in that area of Alabama of the wage rates prevailing
on the construction of lock structures and excavation of canals and
other projects similar to that proposed" under the subject
Gainesville project.
"In view of these circumstances and in consideration of the
strong protest of the applicable Davis-Bacon wage determination of
the Secretary of Labor for the project by a number of interested
parties", Counsel for the Solicitor requested that the Board remand
the matter to the Administrator for the purpose of conducting an
on-site survey of similar construction projects in the area of the
proposed contract work. On the basis of this survey, the
Administrator would then reconsider the matter and advise the Board
and all interested parties of his decision.
By Order dated June 18, 1971, the Board remanded the matter as
requested.
Also, by letter dated June 18, 1971, the Assistant
Administrator notified the Corps of Engineers that Wage
Determination AK-20,424 for the Gainesville job had been officially
withdrawn, and that a survey was to be conducted, beginning June
21, 1971.
By telephone and by letters dated June 29 and July 8, 1971,
the Board notified all interested parties that a hearing was
scheduled on the Gainesville matter for 2:00 p.m., July 16, 1971,
in Room 253, in a number of Alabama counties, including Greene
County. The Wage Determination Division found these wage rates to
be prevailing in Greene County for the heavy-type lock and canals
job in question.
When the Department, on June 7, 1971, confirmed Wage Decision
AK-20,424, the Petitioner appealed to the Wage Appeals Board for a
review thereof, contending that the rates reflected in the original
Decision (AK-16,762) should be reinstated because they were
"representative of the rates paid for similar work and generally
prevailing in a number of projects in the Greene County area."
Because of time limitations, the Petitioner "reserved the right to
present supporting data, views, and arguments at the hearing to be
scheduled before the Wage Appeals Board."
Prior to a hearing scheduled for June 21, 1971, a Motion to
Remand was received by the Board on June 17, 1971, from Counsel for
the Solicitor. In this Motion, it was pointed out that it had come
to the attention of the Administrator (Workplace Standards
Administration) for the first time that "no on-site survey had been
made recently in that area of Alabama of the wage rates prevailing
on the construction of lock structures and excavation of canals and
other projects similar to that proposed" under the subject
Gainesville project.
"In view of these circumstances and in consideration of the
strong protest of the applicable Davis-Bacon wage determination of
the Secretary of Labor for the project by a number of interested
parties", Counsel for the Solicitor requested that the Board remand
the matter to the Administrator for the purpose of conducting an
on-site survey of similar construction projects in the area of the
proposed contract work. On the basis of this survey, the
Administrator would then reconsider the matter and advise the Board
and all interested parties of his decision.
By Order dated June 18, 1971, the Board remanded the matter as
requested.
Also, by letter dated June 18, 1971, the Assistant
Administrator notified the Corps of Engineers that Wage
Determination AK-20,424 for the Gainesville job had been officially
withdrawn, and that a survey was to be conducted, beginning June
21, 1971.
By telephone and by letters dated June 29 and July 8, 1971,
the Board notified all interested parties that a hearing was
scheduled on the Gainesville matter for 2:00 p. m., July 16, 1971,
in Room 253, Vanguard Building, Washington, D. C., which would
cover not only the Motion earlier [5]
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[6] filed by Counsel for the Building Trades Department on the Solicitor's
Remand Motion, but (since general jurisdiction of the case had been
retained by the Board) also, if necessary, the schedule of rates currently
proposed by the Wage Determination Division following the on-site survey as
constituting the new wage determination to be issued for the
Gainesville project here in issue.
At the July 16th hearing, the parties agreed that the session
would be a plenary session of the Board and that all matters raised
thereat would be resolved by the two-man panel.
As the hearing developed, the issue for decision by the Wage
Appeals Board was whether the Administrator's proposed wage
schedule for the Gainesville project, as set forth in his letter
and enclosure of July 2, 1971, addressed to all interested parties
and described as reflecting his review of all the wage data
obtained as a result of the on-site survey, should be approved or
disapproved.
Petitioner stated that he was attacking the Department's
classification of this Gainesville Lock and Canals job as "Heavy
Construction", whereas Petitioner contends the greater portion of
the job is more in the nature of the highway work currently
underway in Greene County, Alabama. Petitioner contends that the
job in question basically involves excavation, compaction, concrete
work, and steel-tying; hence there is no basic difference here from
the Interstate Highway construction work let through the Alabama
Highway Department. Petitioner claims seventy-five to ninety
percent of the work listed in the Invitation to Bid is the same as
the "heavy-type of highway work" currently underway in Greene
County. To the Petitioner, "Building, Heavy, and Highway" are
"artificial" classifications, [6]
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[7] especially when viewed within the framework of today's changing
technology in the construction field.
Petitioner conceded that dam construction jobs may be
considered "heavy" construction -- apparently referring to the
Bankhead job in neighboring Tuscaloosa County -- but emphasized
that the Gainesville job is a lock and canal job. However, the
Mobile Corps of Engineers representative corrected that, pointing
out that the current Bankhead project was strictly a lock job,
contracted out separately from the dam work. The Corps of
Engineers representative further mentioned that the Bankhead lock
job contains the heavy rate schedule (now being protested by the
Petitioner).
A number of contractors who appeared for the Petitioner
stressed that in their opinion the work of constructing a lock and
canals requires the same skills and workmen as, for example, bridge
work currently going on in the area on Interstate Highway 59. In
their view, the equipment and materials used, the employees, the
estimating procedures, the skills involved and the supervision
employed on Interstate or turnpike or airport construction are
identical to those used on a lock and canal job such as the
Gainesville project. It was their position that, when 75% of the
equipment and employees are the same, the jobs are the same. The
Petitioner and those appearing on his behalf requested that the
wage determination for the job in question reflect "projects of a
character similar" and, they contended, because of the changing
technology, highway work (representing the bulk of their project
evidence) is similar to the lock and canals work constituting the
Gainesville contract. They further stressed that their highway
projects evidence in Alabama and Mississippi should he considered
in arriving at the appropriate wage determination, especially to
minimize the [7]
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[8] rippling effect they feared would result on the
Mississippi portion of this Waterway if the currently proposed
higher rates were to be recognized as the prevailing rates for the
initial Gainesville job.
Counsel for the Solicitor of Labor explained how this case
reached the Wage Appeals Board. He further described how the
protested Wage Decision had been withdrawn and an on-site survey
conducted. A team of nine investigators were sent to the area to
conduct a survey covering Greene, Hale, Sumter and Tuscaloosa
Counties. They checked current jobs as well as projects completed
within the past year, as provided for in Section 1.6(a) and (b) of
Regulations, Part 1 (29 CFR, Subtitle A). The survey included
dams, locks, sewers, highways and underpasses. All interested parties
were contacted according to Counsel for the Solicitor.
Counsel for the Solicitor further stated that the
investigators found a current lock job and a current dam project in
Tuscaloosa County. Also, during the past ten years, the Alabama
Power Company had completed six dam and powerhouse jobs throughout
the central Alabama area, -- all done under the same AGC Heavy
Construction agreement proposed for use in the wage determination
to be issued for the Gainesville job. Other Corps of Engineers
jobs in the area, especially the above-mentioned current Bankhead Lock
job in neighboring Tuscaloosa County, provided payroll evidence
confirming the payment of the so-called AGC Heavy rates or rates in
excess thereof. The above private dam construction job in the same
county revealed payment of the same or higher heavy rates as
proposed for Gainesville. According to Counsel for the Solicitor,
all data obtained as a result of this special survey were studied
to determine the area practice with respect to projects of a
character similar to the Gainesville lock and canal job. As a result, [8]
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[9] the classifications and v.wage rates contained in
the Administrator's proposed schedule reflect those classifications
and wage rates currently paid and which recently have been paid as
the prevailing rates in the Greene County area for this kind of
work, according to Counsel.
Counsel for the Solicitor also stressed, in response to the
Petitioner's expressed concern as to any rippling effects of the
proposed schedule of rates for Gainesville, that the Department has
and will continue to predetermine highway rates for highway jobs
based on those rates prevailing in the particular area in question.
He cited the fact that in the State of Alabama alone the Department
recognizes five different highway schedules based on the various
rates found to be prevailing in those five different localities.
Counsel for the Solicitor further emphasized that the proposed w
age determination for the Gainesville Lock and Canals, the subject
of this case, does not establish the wage predeterminations for
other segments of the work on the Tennessee-Tombigbee Waterway
project to be awarded over the next projected ten years of
construction.
Counsel for the Building and Construction Trades Department
stressed that the Davis-Bacon Act, as amended, refers not to
similar equipment, skills, or employees but to projects of a
character similar to the contract work in question. Furthermore he
continued, the Petitioner has submitted no evidence on lock jobs
in the area, whereas, for example, the current Bankhead lock job
and private dam job in adjoining Tuscaloosa County, as w ell as the
other dam and powerhouse jobs in surrounding counties referred to
by Counsel for the Solicitor (all paying the heavy wage schedule)
are all of a character similar to the contract work in question.[9]
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[10] Counsel for the Alabama Branch of the Associated General
Contractors of America, Inc., pointed out that that Branch has had
an agreement covering heavy construction work at least since 1960
and that this agreement covered and still covers work done on locks
and dams in this Alabama area. He considered the payment evidence
from the current Bankhead lock job (running about $7,000,000, an
amount generally comparable to the Gainesville job) as being most
pertinent in this case, and supported the Administrator's proposed
wage schedule for Gainesville as reflecting the rates prevailing
for this kind of work in this subject locality.
The representative of the Mobile Office of the Corps of
Engineers confirmed that the contract in question is physically
located completely in Greene County, Alabama, and is for the lock
and canals only. He confirmed that the current Bankhead job, from
which key payroll wage rate evidence was obtained, is strictly a
lock job.
* * *
The issue to be resolved is whether the wage schedule proposed
by the Administrator for the Gainesville project in his July 2,
1971 notice to all interested parties should be approved or not.
On review of the record an(l all oral statements made at the hearing,
the wage Appeals Board makes the following decision.
The proposed wage schedule for the subject Gainesville job
published by the Administrator on July 2nd is based on a special
survey made of heavy-type construction projects in the Greene
County area. This survey was undertaken after consultation between
the Petitioner an(l the Department of Labor after the appeal was
taken herein. The proposed wage rates reflect the rates paid on
the Bankhead lock job in the adjoining County of Tuscaloosa and the
rates on a current private dam construction job. These rates are
currently recognized by the Alabama Branch of the Associated General [10]
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[11] Contractors and the Building Trades unions with
which the Branch bargains under the heavy construction agreement in
the area. This schedule of heavy construction rates follows the
same heavy construction agreement used on the other six dam and
powerhouse projects previously completed in the same general
locality. All eight projects were found by the Administrator to be
the controlling projects of a character similar to the contract
work in question.
While the Board realizes that the Petitioner submitted a
substantial amount of payment evidence from highway jobs in the
same general area, it finds that the use by the Administrator of
the Bankhead lock project plus the dam and powerhouse projects in
reaching his proposed wage schedule for the Gainesville job was
consistent with the requirements of the Davis-Bacon Act, as
amende(l, and of the applicable regulations, and warrants the
Board's approval of such wage rates for use on the Gainesville lock
and canal project.
The Board has noted Petitioner's argument that highway work is
similar to the lock and canals work constituting the Gainesville
contract and that, therefore, Petitioner's highway projects
evidence in Alabama and Mississippi should be considered in
arriving at the prevailing rates to be determined for the
Gainesville lock and canals job.
The Davis-Bacon Act as originally enacted in 1931 did not
contain the phrase "projects of a character similar to the contract
work", but used the term "work of a similar nature." Congress found
that this latter phrase was "productive of some doubt as to whether
the statute refers to wages in [11]
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[12] the same craft, or wages paid on similar construction." (Sen.
Rept. 332, 5/13/35). Accordingly, Congress amended the Act in 1935 and
enacted the present language. /FN1/ The Senate Subcommittee report
points out that the purpose of the amendment was to make it clear that
the wages to be determined must be on the basis of a comparison of
projects an(l not the work of the crafts. (Senate Report 332, pt. 2,
pp. 5 and 7, 74th Cong., 1st Sess.).
To utilize Alabama and Mississippi highway projects in
determining the rates to be paid on the Gainesville contract under
consideration militates against the statutory requirement of
comparing projects of a character similar to the contract work.
One reason for this is that the contract work includes the lock and
there can be no question that the construction of a lock is not a
project of a character similar to a highway. The Corps of
Engineers estimates that almost 75% of the Gainesville contract
involves the construction of the lock and its facilities.
To illustrate how the contract work in question substantially
differs from highway work, we quote from the "Advance Notice to
Prospective Bidders for the Construction of Lock and Canals,
Tombigbee River, Gainesville, Alabama", published by the Mobile
District Office of the Corps of Engineers, dated April 6, 1971,
referring to the subject Gainesville contract:
The work to be performed includes the following principal
features and approximate quantities:
a. Clearing and grubbing.
b. Construction of an earth cofferdike around lock area and
unwatering work area within cofferdike. [12]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN1/ Section 1 or the Davis-Bacon Act provides for minimum wages
to be paid various classes of laborers and mechanics which shall be
based upon the wages that will be determined by the Secretary of
Labor to be prevailing for the corresponding classes of laborers
and mechanics employed on projects of a character similar to the
contract work in the city, town, village or other civil subdivision
of the State in which the work is to be performed. [12]
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[13] c. Excavation, foundation preparation, and compacted fill;
unclassified excavation -- 3,338,000 cu. yd., foundation
preparation -- 22,100 sq. yd., compacted fill -- 1,409,000 cu. yd.
d. Stone protection work; 25,000 tons riprap over 17,600 tons
of bedding material.
e. Concrete work; 166,400 cu. yd. mass concrete, 2,000 cu. yd.
reinforced concrete.
f. Control station and operation booths, including plumbing,
heating, and air conditioning systems.
g. Lock miter gates.
h. Lock tainter valves.
i. Hydraulically operated lock operating machinery.
j. All electrical equipment and connections required for the
operation of the lock, Control Station, operation booths, and water
system.
k. Lock instrumentation.
l. Water supply system.
m. Sanitary sewer system.
n. Flexible pavement.
o. Grassing; seeding -- 200 acre, mulching -- 11 acre, sodding
440 sq. yd.
p. Miscellaneous work including diesel engine generator unit,
compressed air system, potable and fire protection water systems,
painting, floating mooring bitts, culvert bulkheads, lock step logs
and pickup beam, gratings, hand-railing, wall armor and protection
angles."
* * *
While approving the wage rates proposed by the Administrator
for the contract in question, the Board notes an aspect of the
argument based upon apprehension covering future wage
determinations. Under the Davis-Bacon Act, a wage predetermination
is based on factual inquiry; wage predetermination by wage
predetermination, one by one at a time. See by way of example the
Wage Appeals Board decision in WAB Case No. 69-04, July 18, 1969 in
the Matter [13]
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[14] of Federal-Aid Interstate Project No. I-10-1(33)27, Mobile County,
Alabama, Tunnel under Mobile River. The Board directs the attention of
the Wage Determination Division to what it must certainly already know.
The wage rates determined for the segment of the Waterway contract
including the Gainesville lock work as described above should not per se
result in a proliferation of the same wage determination for subsequent
contract work which is not of a character similar to lock work or
is located in a locality where practice or wage schedules may be
different. Such questions are not now before us. The Board does,
however, caution the Wage Determination Division that each segment
of the overall Waterway project must be resolved on its own
considerations under established Davis-Bacon Act principles and in
accordance with the practices and rates prevailing in the locality
where each such segment is geographically located. /FN2/
* * *
Finally, it is noted that at the hearing several spokesmen for
the Petitioner made reference to policies underlying Executive
Order No. 11588 (36 F. R. 6339), and to other policies dealing with
employment and inflationary trends. It was urged that such
policies and principles be incorporated into the interpretation of
the Davis-Bacon Act and into its administration Executive Order No.
11588 provides machinery for excluding from consideration by the
Administrator, any wage or salary increases for laborers or
mechanics employed on construction subject to the Davis-Bacon and
related Acts which are in excess of that found to be acceptable
under the Executive Order. [14]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
/FN2/ Section 1 of the Davis-Bacon Act provides for minimum wages
to be paid various classes of laborers and mechanics which shall be
based upon the wages that will be determined by the Secretary of
Labor to be prevailing for the corresponding classes of laborers
and mechanics employed on projects of character similar to the
contract work in the city, town, village of other civil subdivision
of the State in which the work is to be performed. See also
Sections 1.2 and 1.6(a) and (b) of the Department's Regulations, 29
CFR, Subtitle A. [14]
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[15] In the implementation and administration of the Davis-Bacon
Act and related Acts, Executive Order No. 11588 is, therefore, a
negative factor. By a process of exclusion, the Executive Order
can prevent unacceptable wage or salary increases from passing over
the Wage Determination Division threshold into the wage data which
the Administrator is required to take into consideration in making
wage predeterminations in accordance with the Davis-Bacon Act.
Beyond this, the policies that have entered into the promulgation
of Executive Order No. 11588 with respect to the stabilization of
wages and salaries in the construction industry have no direct
application in making wage determinations under the Davis-Bacon
Act.
The Davis-Bacon Act has been since 1931, and continues to be,
a free-standing statute predicated upon its own statutory policies
and administered according to an established yet evolving body of
rules, regulations, practices and interpretations of its own. For
this reason, the several arguments at the hearing on behalf of the
Petitioner to bring about basic policy changes in interpretations
and administration of the Act raised matters which under
appropriate circumstances might be addressed to the Construction
Industry Stabilization Committee in connection with the level of
negotiated wage and salary increases. Other employment policy
considerations might better be raised before some other body. As
a matter of fact, the Petitioner, after requesting and obtaining
approval by this Board for review of the Administrator's wage
determination, AK-20,424, (the one that was then cancelled by the
Administrator) brought about the removal of the case to the
Department of Labor for reconsideration at Secretarial level.
The Petitioner quite properly had the Department of Labor
remove the case from the Board so that the Department could examine
other policy matters [15]
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[16] new and old, that Petitioner believed important. The Petitioner,
having thus gained an opportunity for a full review of such other policy
matters, apparently without success, this Board upon consideration of
the question whether the proposed wage determination shall be put into
effect under Davis-Bacon Act principles will not reassess policy
determinations made by the Department of Labor which are not germane
to the interpretation and administration of the Act.
ORDER
The Administrator and the Wage Determination Division are
advised that the proposed wage rates of July 2, 1971 for the
subject contract are hereby approved. A Wage Decision in
accordance herewith should be issued as soon as possible.
SO ORDERED
Stuart Rothman, Acting Chairman
Clarence D. Barker, Member
WAGE APPEALS BOARD [16]
