A-MAC SALES AND BUILDERS COMPANY, INC. , WAB No. 90-37 (WAB Apr. 19, 1991)
CCASE:
A-MAC SALES AND BUILDERS COMPANY, INC.
DDATE:
19910419
[TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D. C.
In the Matter of:
A-MAC SALES AND WAB Case No. 90-37
BUILDERS COMPANY, INC.
BEFORE: Charles E. Shearer, Jr., Chairman
Ruth E. Peters, Member
Patrick J. O'Brien, Member
DATED: April 19, 1991
DECISION OF THE WAGE APPEALS BOARD
This matter concerns the manner in which wage rate
determinations are made pursuant to All Agency Memorandum ("AAM")
130. It is before the Wage Appeals Board on the petition of A-MAC
Sales and Builders Company, Inc. ("A-MAC" or "Petitioner"), seeking
review a July 3, 1990 ruling of the Acting Administrator of the
Wage and Hour Division, wherein it was determined that "building"
construction rates (rather than the lower "residential" rates)
should apply to the rehabilitation of the Bachelor Officers
Quarters at Selfridge Air National Guard Base in Macomb County,
Michigan. For the reasons contained herein, the ruling of the
Acting Administrator is reversed. [1]
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[2] I. BACKGROUND
On September 21, 1988, A-MAC was awarded a contract for the
rehabilitation of the Base Officers Quarters ("BOQ") at Selfridge.
A-MAC was the low bidder on the project by some $250,000 (Record,
Tab E). Work on the project was allegedly completed early in the
fourth quarter of 1989. Laborers employed on the project were
paid at the residential rate, and neither the record nor the
allegations of the parties reveal complaints by the laborers or
their bargaining representatives. The ruling by the Acting
Administrator was issued some nine months after the work was
completed, and some $30,000 was withheld by the Corps of Engineers.
The Selfridge BOQ is a two-story brick unit with a central
kitchen and 27 units, each of which contains a living room, bedroom
and bath. The four corner units have individual kitchens.
(Record, Tabs D and K).
The contract at issue contained an area wage determination
which included both building and residential wage rates. Although
the Corps of Engineers had underlined "Building" on that area wage
determination, it had also checked an SIC Code classification for
"Residential Buildings, Other than Single-Family" (Record, Tab
E). When work began pursuant to this contract, the Petitioner used
the residential wage rates for laborers, apparently in reliance on
the local collective bargaining agreement, which provided in
pertinent part:
RESIDENTIAL LABORER
Residential construction is defined as all work in
connection with construction, alteration or repair of all
residential units .... This Residential Agreement and
Residential Rate does not apply to those housing units
constructed of reinforced concrete and/or steel frame
units normally referred to as "High Rise" and units
normally in excess of two stories.
(Record, Tab F at 13).
Almost from the onset of the project, the appropriate wage
rate for the laborers was debated. By February 16, 1989, the Corps
of Engineers took the position that building rates applied to the
project (Record, Tab I) despite the fact that local unions regarded
the project as residential (Record, Tab H).
At some point prior to July 1990, the Wage and Hour Division
contacted Laborers Local Union No. 334, the representative of
A-MAC's employees, for advice on the question whether building or
residential rates applied. That Local [2]
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[3] asked for the higher wage rate despite the above quoted contract
language (Record, Tab B).
On July 3, 1990, the Acting Administrator issued his final
determination that building wage rates applied to the project in
question. That determination states:
All Agency Memorandum No. 130 explains that residential
projects are those involving the construction, alteration
or repair of single family houses or apartment buildings
of no more than four stories in height. Typically,
projects recognized as residential in character contain
a private bathroom and individual kitchen in each unit.
Buildings such as dormitories . . . do not qualify as
residential construction. These facilities do not
contain traditional residential living arrangements such
as separate kitchen facilities in each unit. Inasmuch as
Building 410 is similar to the latter type of facilities,
the building construction wage rates should be applied.
(Record, Tab A).
II. DISCUSSION
As the Board recently ruled in Dutch Hotel (SRO) Kitchen, WAB
Case No. 90-29 (Mar. 22, 1991), AAM 130 is intended to be
flexible and illustrative -- a guideline rather than a
set of hard and fast rules.... AAM 130 cautions that it
is necessary to consider all aspects of the contract,
including construction techniques, materials and
equipment, and the skills to be employed on the project.
The Board agrees with AAM 130 insofar as it calls for a
consideration of the overall nature of the undertaking
rather than a mechanical application of "bright line"
tests.
(Slip op. at p. 4). Furthermore, the Board stated that Wage and
Hour has the burden of demonstrating the correctness of its
decision based upon the overall nature of the project (i.e., the
work to be performed as well as the end use of the construction) in
the context of prevailing area practices. Id. at p. 5.
A literal reading of AAM 130 leads to the conclusion that the
Selfridge project was probably "residential" within the meaning of
that document: less than four stories; separate bathrooms and some
separate kitchens; end use as living quarters rather than for
business or commercial purposes. [3]
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[4] A broad reading of AAM 130 (consistent with Dutch Hotel,
supra,) also leads to the conclusion that the Selfridge project was
residential. Consider the work to be performed and techniques to
be employed: A-MAC engaged in asbestos abatement, window repair
and replacement, and other rehabilitation employing techniques
uncommon to "building construction" projects.
Accordingly, the decision of the Acting Administrator is
reversed.
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 [4]
