ROST ELECTRIC COMPANY, INC., WAB No. 90-10 (WAB May 24, 1991)
CCASE:
ROST ELECTRIC COMPANY, INC.
DDATE:
19910524
TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D.C.
In the Matter of:
ROST ELECTRIC COMPANY, INC.,
O'Neil Village WAB Case No. 90-10
Project No. 033-43057-FM-SR
Pittsburgh, Pennsylvania
BEFORE: Charles E. Shearer, Jr, Chairman
Ruth E. Peters, Member
Patrick J. O'Brien, Member
DATED: May 24, 1991
DECISION OF THE WAGE APPEALS BOARD
This case is before the Wage Appeals Board upon the petition
of Rost Electric Company, Inc. ("Rost" or "Petitioner") for review
of a November 24, 1989 decision by the Acting Administrator of the
Wage and Hour Division denying Rost's request for the addition of
classifications to the applicable wage determination. For the
reasons discussed below, the Board denies the petition for
review.
I. BACKGROUND
Petitioner contracted with the Department of Housing and Urban
Development ("HUD") to perform work on the O'Neil Village Project
(Project No. 033-43057-FM-SR) in Allegheny County, Pennsylvania.
The project was subject to Davis-Bacon requirements pursuant to
Section 212(a) of the National Housing Act (12 U.S.C. [sec] 1715c),
a Davis-Bacon Related Act. The wage determination that was
applicable to the project was Wage Decision No. PA86-1. The
project was completed in December 1987. [1]
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[2] HUD informed Rost by letter dated January 29, 1988 that an
investigation of the project had disclosed that (1) Rost had failed
to pay employees Dale Kovac and Timothy Kristobek the required
prevailing wage rate for the classification of work they performed;
and (2) Rost had not included Kovac and Kristobek on the certified
payrolls. By letter to HUD dated February 11, 1988, Petitioner
requested that an "electrician's pre-apprentice" classification be
added to the applicable wage determination, with the proposed
classification to be paid $4.50 per hour plus $1.00 in fringe
benefits. The rate listed for electricians in the wage
determination was $17.72 per hour plus $3.55 + 3% in fringe
benefits. Petitioner provided a copy of a portion of its agreement
with the International Brotherhood of Electrical Workers, Local
Union No. 5 ("IBEW Local 5"), regarding the union's
pre-apprenticeship program. The agreement stated that the
pre-apprenticeship was 18 months long, at that at the end of the
program the pre-apprentice would be given a test for admission into
the apprenticeship program. The agreement also stated that
pre-apprentices would be "under the supervision and control of the
contractor with the prior approval of the Local Union staff on a
job by job basis to ensure that they will be used to the best
competitive advantages." (FOOTNOTE 1)
By letter dated March 1, 1988, HUD denied Petitioner's request
for an additional classification on the ground that Kovac and
Kristobek were not registered in an apprentice program approved by
either the Bureau of Apprenticeship and Training ("BAT") of the
U.S. Department of Labor or the state apprenticeship agency.
Having determined that the two employees performed electrician work
on the project, HUD calculated unpaid wages totaling $9,999.40 for
Kristobek and $9,368.40 for Kovac.
Petitioner appealed HUD's denial of the request for addition
of the electrician pre-apprentice classification to the Department
of Labor. Petitioner stated that IBEW Local 5 had discontinued
its pre-apprentice program and had implemented a new five-year
apprenticeship program. Petitioner also stated that the
pre-apprentices were essentially equivalent to the first-year
apprentices in the new program, and offered to make restitution
based on what first-year apprentices in the new program would
receive. In addition, Petitioner provided the Department of Labor
with a letter from IBEW Local 5 regarding the pre-apprentice
program. The August 25, 1987 letter described the purpose
of the program as "to initiate a certain few young men and women to
the electrical construction industry. They are entitled
pre-apprentices and placed with selective contractors to execute
rudimentary work similar to our first-year apprentices. Our intent
is to afford [2]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
(FOOTNOTE 1) With respect to HUD's allegation regarding the certified
payrolls, Richard E. Rost, Petitioner's president, acknowledged at
a February 18, 1988 meeting with HUD that Petitioner had not
listed Kovac and Kristobek on the payrolls because he "didn't know
what classification to put them under." [2]
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[3] them an opportunity to observe the work they will be performing
while waiting for an apprentice position."
By letter dated February 16, 1989, the Acting Director of the
Department of Labor's Division of Wage Determinations told HUD
that the addition of a pre-apprentice classification could not be
approved. "Pre-apprentices or trainees (by whatever name) are
permitted to work at a rate less than that specified in the wage
determination only when they are employed pursuant to and
individually registered in a program approved by the appropriate
Federal or State agency," the Acting Director stated. Citing 29
C.F.R. 5.5(a)(4), the Acting Director added that employees who are
not registered in an approved program must be paid the wage rate
for the classification of work they perform. Rost requested
reconsideration of the Acting Director's determination by letter
[dated] March 14, 1989. Rost claimed that "the position of
`helper' more accurately describes the roles of [Kovac and
Kristobek], rather than that of apprentice, journeyman or
electrician."
The Acting Administrator of the Wage and Hour Division denied
Petitioner's request for reconsideration on November 24, 1989. On
the "helper" issue, the Acting Administrator stated that Rost
apparently believed that Kovac and Kristobek were "helpers"
according to the definition in the Department of Labor regulations
published in the Federal Register on January 27, 1989. The Acting
Administrator noted, however, that these regulations would not
take effect until the U.S. District Court for the District of
Columbia lifts an injunction with regard to those regulatory
provisions. In any event, the Acting Administrator added, the
regulations will not be applied retroactively to contracts already
awarded.
At present, the Acting Administrator stated, "helper
classifications and other subclassifications can only be added to
a Davis-Bacon wage determination, where the duties of helpers are
clearly defined and distinct from those of the journeyman
classification and the laborer classification and where the term
`helper' is not synonymous with `trainee' in an informal training
program." Rost, the Acting Administrator added, has not provided
"any evidence to show that the above criteria for recognizing
`helpers' have been met. Consequently, we cannot conform a
classification for `helper' to the wage determination."
The Acting Administrator also addressed the "electrician
pre-apprentice" issue, noting that Rost had previously been
advised that the "electrician pre-apprentice" classification
could not be added to the wage determination. The Acting
Administrator stated that the Department of Labor does not issue or
conform classifications and wage rates for apprentices and
trainees, who are permitted to work at less than the predetermined
wage rate only when they are employed pursuant to the requirements
of 29 C.F.R. 5.5(a)(4). [3]
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[4] II. DISCUSSION
On review, the Board concludes that the Acting Administrator's
decision in this matter should be affirmed. Beginning in February
1988, Petitioner pressed HUD and the Department of Labor to approve
a "pre-apprentice" classification. Both HUD and the Acting
Director of the Department of Labor's Division of Wage
Determinations denied the request "pre-apprentice" classification
request, since employees Kovac and Kristobek had not been
registered in an apprentice or trainee program that had been
approved by the appropriate Federal or state agency. The
determinations by HUD and the Acting Director were in accord with
the Department of Labor's regulations at 29 C.F.R. 5.5(a)(4)
regarding employment of apprentices and trainees, and with Board
precedent. See, e.g., Van Den Heuvel Electric, Inc., WAB Case No.
91-03 (Feb. 13, 1991) (back wages were owed to employees who were
not employed pursuant to and individually registered in a trainee
program which has received approval from the Department of Labor's
Bureau of Apprenticeship and Training).
Only after HUD and the Acting Director properly denied Rost's
request for a "pre-apprentice" classification did Petitioner claim
that the position of "helper" "more accurately describes the roles
of [employees Kovac and Kristobek], rather than that of apprentice,
journeyman or electrician." However, the Acting Administrator of
the Wage and Hour Division declined to conform a helper
classification to the wage determination, and the Board discerns no
basis for setting aside the Acting Administrator's decision. As
noted by the Acting Administrator, a helper classification could be
added to the wage determination in this matter only if the helper
duties were clearly distinct from those of the journeyman and
laborer classifications, "and if the term `helper' is not
synonymous with `trainee' in an informal training program." (FOOTNOTE 2)
See Soule Glass and Glazing Co., WAB Case No. 78-18 (Feb. 8, 1979)
(helpers do not perform the work of journeymen, and are not engaged
in learning the trade with the view of eventually becoming a
journeyman); Clevenger Roofing and Sheet Metal Co., WAB Case No.
79-14 (Aug. 20, 1983) ("helpers" who are engaged in learning the
trade may be paid less than the predetermined wage rate only if
they are registered in an approved apprenticeship or trainee
program pursuant to 29 C.F.R. 5.5(a)(4)). However, the Acting
Administrator determined in this matter [4]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
(FOOTNOTE 2) The Acting Administrator noted in her November 24, 1989
decision that Rost apparently believed that Kovac and Kristobek
were helpers based on the definition in 29 C.F.R. 5.2(n)(4), but
added that these regulations would not become effective until the
U.S. District Court for the District of Columbia lifted an
injunction regarding those regulatory provisions. The court
subsequently lifted the injunction referred to [in] the Acting
Administrator's decision. Building and Construction Trades
Department, AFL-CIO v. Dole, 116 CCH Labor Cases [par] 35,395
(D.D.C. 1990). However, as the Acting Administrator further
informed Rost, those regulations will not be applied retroactively
to contracts already awarded. [4]
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[5] that Rost failed to submit evidence to show that the criteria
for recognizing a "helper" classification had been satisfied.
Before the Board, Petitioner's principal argument is that it
was denied the opportunity "to provide a factual explanation of
the helper position (misnamed Pre-Apprentice Program by the IBEW),"
and that the matter should be remanded for a hearing before an
Administrative Law Judge. However, the Board rejects Petitioner's
claim, for there is no indication that Rost was foreclosed from
presenting information to the Department of Labor regarding the
"helper" classification. Furthermore, the information that Rost
did submit fails to demonstrate the existence of a factual dispute
warranting a hearing before an ALJ. Instead, the information
provided by Petitioner demonstrates that the "pre-apprentice"
classification was an apprentice or trainee position. Thus, the
description of the program by IBEW Local 5 -- a description
submitted by Petitioner to the Department of Labor -- characterizes
the program's purpose as "to initiate a certain few young men and
women to the electrical construction industry," and states that
these individuals are placed with contractors "to execute
rudimentary work similar to our first-year apprentices." In short,
the Acting Administrator properly denied Rost's request for
addition of a helper classification to the wage determination.
The petition for review is denied. The November 24, 1989
decision of the Acting Administrator is affirmed.
BY ORDER OF THE BOARD:
Charles E. Shearer, Jr., Chairman
Ruth E. Peters, Member
Patrick J. O'Brien, Member
___________________________
Gerald F. Krizan, Esq.
Executive Secretary [5]
