U.S. Department of Labor
Administrative Review Board
200 Constitution Avenue, N.W.
Washington, D.C. 20210
ARB Case No. 96-116 (Formerly WAB Case No. 95-13) ALJ Case No. 94-DBA-72 Date: October 25, 1996
In the Matter of
P&N, INC./THERMODYN MECHANICAL
CONTRACTORS, INC., a/k/a THERMODYN
CONTRACTORS, INC.
Subcontractor
ALBERT GAMBOA, FRANK GAMBOA &
ESPERANZA GAMBOA, individually
With respect to laborers and mechanics
employed by the Subcontractor under Contract
No. GS-07P-90-HUC-0056 for plumbing and
utilities installation at the border
inspection station located at 3900 Paisano,
El Paso, Texas.
1 This matter was
originally filed before the Wage Appeals Board. On April 17,
1996, the Secretary of Labor re-delegated authority to issue
final agency decisions under, inter alia, the Davis-Bacon
Act, as amended, 40 U.S.C. § 276a et seq. (1994), and
the Contract Work Hours and Safety Standards Act, as amended, 40
U.S.C. § 327 et seq. (1994), to the newly created
Administrative Review Board. Secretary's Order 2-96 (Apr. 17,
1996), 61 Fed. Reg. 19978 (May 3, 1996). Secretary's Order 2-96
contains a comprehensive list of the statutes, executive order,
and regulations under which the Board now issues final agency
decisions.
2 The ALJ
concluded that Esperanza Gamboa did not actively participate in
the direction of the employees on this project and that she was
not a responsible officer under the statutes here at issue. D.
and O. at 4 ¶2. The Administrator does not challenge this
finding. Adm'r Brief at 2 n.1.
3 The
following abbreviations are used herein for references to the
record: Hearing Transcript, T.; Plaintiff's Exhibit, PX; ALJ's
Exhibit, ALJX. Although Thermodyn submitted exhibits with its
Prehearing Exchange dated April 24, 1995, Thermodyn did not offer
any exhibits at hearing.
4 The
parties stipulated that $5,634.41 in back wages had been paid to
Thermodyn employees pursuant to the assessment by Wage and Hour.
T. 8-9 (parties' discussion, referring to ALJX 8). Although the
Wage and Hour investigation also focused on the misclassification
of laborers performing the work of equipment operators, that
issue was not preserved by the Administrator for hearing. T. 23-25.
5 Of the
Thermodyn officers, only Albert Gamboa, president of the company,
testified at hearing.
6 The record
does not support the ALJ's finding that "Gamboa held a
meeting with employees at the site to advise laborers not to use
tools to perform sheet metal work," D. and O. at 4 ¶15.
See T. 85-87 (Gamboa), 97-98 (Molina); see also T.
34 (Regalado), 47-48 (Duran), 53-54 (Barragan); see generally
Tom Rob, Inc., WAB Case No. 94-03, June 21, 1994, slip op. at
5 (ALJ's factual findings generally given deference except when
clear error is found).
7 The
debarment period is three years under either the DBA or the
CHWSSA. 29 C.F.R. § 5.12 (a); compare 29 C.F.R.
§ 5.12(a)(1) with (a)(2). Under the DBA, however,
there is no provision for the Secretary to order a shorter period
based on mitigating factors, as there is under the Davis-Bacon
Related Acts, including the CHWSSA. See G & O General
Contractors, WAB Case No. 90-35, Feb. 19, 1991, slip op. at
2-3 and authorities cited therein.
8 Wage and
Hour alleged underpayment of sixteen Thermodyn employees
classified as laborers; the ALJ concluded that the evidence only
provided support for the conclusion that seven Thermodyn
employees had been underpaid based on misclassification. D. and
O. at 5; T. 72-74. As noted by the Administrator, Adm'r Brief at
9 n.5, we need not decide the question of precisely how many
employees were misclassified in order to reach a determination
regarding the debarment issue.
9 Inasmuch
as Wage Determination TX90-9 did not allow for different classes
of laborers, we need not distinguish between the classifications
of "common laborer" and "semi-skilled
laborer" used by Thermodyn, PX 1, for purposes of this
analysis.
10 In the
course of this testimony, Gamboa referred repeatedly to previous
problems with misclassifications and/or underpayments to
employees. T. 86, 89-93. Thermodyn refused to admit that Wage
and Hour had conducted three prior investigations of Thermodyn
regarding DBA requirements. Respondents' Responses to
Plaintiff's Request for Admissions at 3 ¶10. At hearing,
however, Thermodyn agreed to stipulate that prior investigations
of Thermodyn regarding compliance with DBA requirements had been
conducted. T. 10 (parties' discussion regarding ALJX 8 at 3-4).
11 The one
change that could arguably have been made in response to the
investigator's meeting with Gamboa in August was the payment and
classification of Moises Moreno, previously classified as a semi-skilled laborer and paid at the
rate of $7.00 per hour, at the
sheet metal worker classification and the higher rate of $7.72
per hour, beginning with the payroll period ending August 20,
1991. PX 1.
12 Although
the Wage and Hour investigator advised Gamboa in the August
interview that he would be checking prior payrolls to determine
back wages that were due to misclassified employees at the BOTA
site, there was no basis for Gamboa to fail to recognize
Thermodyn's responsibility for ensuring that the payroll for the
period then in progress, as well as future payrolls, accurately
reflected payment to the misclassified employees for the sheet
metal mechanics' work that the investigator had observed or any
such work in the future. See T. 19-20, 27-29 (Gibson),
88-92 (Gamboa).
13 That
payroll entry is for Leobardo Reyes, paid for hours as both a
sheet metal worker and a common laborer during the payroll period
ending May 14, 1991. PX 1.
14 The ALJ
also did not address the material difference between the
testimony of Gamboa and that of Molina regarding the question of
whether laborers would have been expected to use sheet metal
tools in demolition work inside the buildings at the BOTA site.
Gamboa testified that laborers would use sheet metal snips and
other tools for cutting ductwork from the structure during
demolition. T. 84; see T. 83-85. In contrast, in
response to a question on direct examination regarding whether
the laborers use tools to perform the demolition inside the
buildings, Molina answered, "No. Mostly it's done with a
tractor or with a backhoe. It's knocked down and then all they
do is load it up into dump trucks and the dump trucks haul it to
the landfill or to a salvage yard." T. 95; see generally
Vicon Corp., WAB Case No. 65-03, Dec. 15, 1965, slip op. at
4-8 (addressing failure of ALJ to properly resolve conflicts in
the evidence).
15 The sheet
metal foreman at the BOTA site was Frank Elizadro. T. 86
(Gamboa). He was not called as a witness at hearing.
16 The range
of conduct in flagrant violation of the DBA and related acts
involved in those cases includes the creation of fictitious
payroll records in lieu of the keeping of accurate payroll
records, P.B.M.C., Inc., WAB Case No. 87-57, Feb. 8, 1991,
and misstatements concerning the pay rates actually paid,
Phoenix Paint Co., WAB Case No. 87-08, May 6, 1989.
17 Molina
testified that, in determining how many hours a day a worker had performed sheet metal
mechanics' work, the foreman considered how many hours a day the worker was wearing sheet
metal tools. T. 98. Molina continued, "He guesses at it." Id. This
evidence indicates a lack of a reliable procedure for properly recording work hours for the
purpose of segregating work performed in different classifications.