FOWLER & BUTTS, GENERAL CONTRACTOR, INC., WAB No. 92-01 (WAB June 25, 1992)
CCASE:
FOWLER & BUTTS,
DDATE:
19920625
TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D. C.
In the Matter of:
FOWLER & BUTTS,
GENERAL CONTRACTOR, INC., WAB Case No. 92-01
Prime Contractor
BOB HOWE & COMPANY,
Subcontractor
BEFORE: Charles E. Shearer, Jr., Chairman
Ruth E. Peters, Member
Stuart Rothman, Senior Member
DATED: June 25, 1992
DECISION OF THE WAGE APPEALS BOARD
This matter is before the Wage Appeals Board on the petition
of the Acting Administrator of the Wage and Hour Division for
review of the December 26, 1991 decision and order (reconsideration
denied March 20, 1992) of Administrative Law Judge ("ALJ") Donald
W. Mosser. The Acting Administrator seeks reversal of the ALJ's
denial of back wages for Independence Day as a paid holiday. For
the reasons stated below, the Acting Administrator's petition for
review is granted, and this matter is remanded to the ALJ for
action consistent with this decision. [1]
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[2] I. BACKGROUND
The United States Postal Service entered into a contract on
September 15, 1987 with Fowler & Butts, General Contractors, Inc.
("Fowler & Butts") to construct a post office in Campbell,
California. In October 1987 Fowler & Butts subcontracted with Bob
Howe & Company ("Howe") for the furnishing and installation of
carpentry and cabinets. The subcontract was subject to the labor
standards provisions of the Davis-Bacon Act (40 U.S.C. [sec] 276a
et seq.), and the Contract Work Hours and Safety Standards Act (40
U.S.C. [sec] 327 et seq.) ("CWHSSA"). The wage determination
applicable to the subcontract was General Wage Decision No. CA87-4.
That wage determination listed a wage rate of $21.23 per hour plus
$6.875 in fringe benefits for carpenters, and a rate of $16.71 plus
$5.56 in fringe benefits for laborers. The wage determination also
required compensation for seven paid holidays, including
Independence Day.
As the result of a January 1989 investigation, a Wage and Hour
Division compliance officer concluded that Howe had violated the
Davis-Bacon Act by misclassifying employees and by failing to pay
the appropriate wage rate for carpenters and laborers. The
compliance officer also determined that Howe had violated the
CWHSSA by failing to pay overtime compensation for hours worked in
excess of 40 per week; liquidated damages were assessed in the
amount of $320. In addition, the investigation revealed that Howe
failed to compensate employees for Independence Day as a paid
holiday.
The U.S. Postal Service, at the request of the Wage and Hour
Division, withheld $22,078.28 for payment of back wages and
overtime compensation alleged to be due to Howe's four employees.
Both Fowler & Butts and Howe requested a hearing before an ALJ.
During the hearing the amount of unpaid wages alleged to be due was
increased to $23,957.28.
In a December 26, 1991 decision and order, the ALJ concluded
that Howe had misclassified two employees, had failed to pay the
applicable wage rates and overtime compensation, and had improperly
recorded the hours worked by its employees. However, the ALJ
concluded that Howe's employees were entitled to only $7,701.14 in
back wages. There were two bases for the reduction in the amount
of back pay. First, the ALJ found that the compliance officer's
reconstruction of the number of hours worked by Howe's employees
was in error, and that Fowler & Butts' records were the most
accurate depiction available of the hours and days worked by Howe's
employees. Accordingly, the ALJ reduced the compliance officer's
back wage calculations. Second, the ALJ determined that no
evidence had been presented concerning the prevailing practice in
Campbell, California regarding paid holidays as fringe benefits.
Accordingly, the ALJ denied back wages for Independence Day. [2]
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[3] The Acting Administrator filed a motion with the ALJ for
reconsideration of the denial of compensation for Independence Day
as a paid holiday. In his March 20, 1992 decision denying
reconsideration, the ALJ did not consider the merits of the
reconsideration request; rather, the ALJ ruled that he did not have
jurisdiction under 29 CFR Part 6 to consider the matters addressed
in the reconsideration request, and that pursuant to 29 CFR 6.34
the motion for reconsideration was untimely filed.
II. DISCUSSION
The only issue presented here for review is whether the ALJ
erred in denying Howe's employees back pay for Independence Day as
a paid holiday. The Board concludes that by denying compensation
for Independence Day, the ALJ committed clear error as a matter of
fact and of law.
The ALJ premised the denial of back wages for Independence Day
on his finding that "the record is devoid of evidence as to the
prevailing union practice regarding holiday pay in the Campbell,
California area." However, the ALJ failed to take note of the
applicable wage determination -- incorporated in the subcontract
and part of the record evidence -- which specifically provides that
employees are to be compensated for seven holidays, including
Independence Day. Furthermore, the absence of testimonial evidence
on the prevailing practice regarding paid holidays is without
consequence in the context of this case. Fringe benefits are
included in a wage determination when it is ascertained that those
fringe benefits prevail in the area. See 29 CFR 5.29, 5.30.
Finally, the Department of Labor's regulations make clear
subcontractor Howe is required as a matter of law and the terms of
the subcontract to pay "the full amount of wages and bona fide
fringe benefits . . . contained in the wage determination." 29 CFR
5.5(a)(1)(i) (incorporated, along with the applicable wage
determination, in the subcontract).
Before the Board, Respondents Fowler & Butts and Howe have two
principal contentions -- first, that the record contains no
evidence that Howe's employees were entitled to holiday pay for
Independence Day. As we have discussed above, that contention is
without merit. Second, Respondents argue that the employees are
not entitled to holiday pay for Independence Day because they "did
not work for several days, both before and after July 4th, 1988 --
let alone July 4th." That allegation is baseless, given the ALJ's
finding, amply supported by the record evidence, that the employees
worked the four weekdays immediately preceding the July 4 holiday
for at least eight hours a day, and continued to work eight hours
a day for the rest of the holiday week. [3]
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[4] III. ORDER
For the reasons stated above, this case is remanded to the
ALJ, who shall award to the affected employees additional back
wages for Independence Day as a paid holiday.
BY ORDER OF THE BOARD:
Charles E. Shearer, Jr., Chairman
Ruth E. Peters, Member
Stuart Rothman, Senior Member
Gerald F. Krizan, Esq.
Executive Secretary [4]
