ARB CASE NO. 98-130
(Formerly ALJ Case No. 94-DBA-58)
DATE: December 30, 1999
In the Matter of:
SUNDEX, LTD., Contractor
and
JOSEPH J. BONAVIRE, Owner
and
Proposed debarment for labor
standards violations by:
SUNDEX, LTD., Contractor
and
JOSEPH J. BONAVIRE, Owner
With respect to laborers and mechanics
employed by SUNDEX, Ltd. to repair and
replace concrete floor slabs at the U.S. Army
Natick RD&E Center, Natick, MA, under U.S.
Army Contract No. DACA33-89-B-0083; install
handicapped ramps at the U.S. Army Natick
RD7E Center, Natick, MA under U.S. Army
Contract No. DAAK60-89-C-1059; and construct
helicopter pads with navigational lights at the
United States Air Force transmit sites at
Moscow and Columbia Falls, ME, under
Air Force Contract No. F27604-88-C-0036
BEFORE: THE ADMINISTRATIVE REVIEW BOARD
Appearances:
For the Respondents:
Robert M. Walsh, Esq.,
Walsh and Associates, Manchester,
New Hampshire
For the Complainant:
Lois Zuckerman, Esq.; Paul H.
Frieden, Esq.; Steven J. Mandel,
Esq.;
U.S. Department of Labor, Washington, D.C.
FINAL DECISION AND ORDER
This case raises two issues: first, whether Respondent Sundex, Ltd. (Sundex),
a construction contractor holding three Federal construction contracts violated Federal procurement
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laws by (a) unlawfully paying less than the prevailing wage and fringe benefit rates to its employees
and misclassifying them, (b) unlawfully failing to pay employees the proper wage rates for overtime
work, and (c) unlawfully falsifying payroll records; and second, if Sundex violated the law with
regard to wages, fringe benefits, overtime payments and record keeping, whether the company and
its principal, Respondent Joseph J. Bonavire (Bonavire), therefore should be debarred from further
Federal contracts. Each of the three contracts was subject to the Davis-Bacon Act, 40 U.S.C.
§267a (1994)(DBA) (requiring payment of prevailing wage and fringe benefit rates on Federal
construction contracts), the Contract Work Hours and Safety Standards Act, 40 U.S.C. §327
et seq. (1994)(CWHSSA) (requiring payment of overtime rates on Federal construction
contracts for work performed in excess of 40 hours per week) and regulations implementing these
statutes at 29 C.F.R. Parts 1, 3 and 5 (1999).
Following an investigation by staff of the Labor Department's Wage and Hour
Division, the Acting Administrator of the Division (Administrator) brought this administrative action
against Sundex and Bonavire seeking payment of back wages and debarment. A hearing into the
matter was held before an Administrative Law Judge (ALJ) pursuant to 29 C.F.R. §6.30, and
the ALJ issued a [Recommended] Decision and Order (R. D. and O.) on April 27, 1998. Although
the ALJ concluded that the Administrator failed to prove a few of the violations that originally had
been alleged, he found against Sundex on most of the charges and ordered the payment of $4,104.12
in back wages. The ALJ also recommended that Sundex and Bonavire be debarred. Id.
Sundex and Bonavire appealed to this Board. We have jurisdiction pursuant to the Davis-Bacon Act
and the Contract Work Hours and Safety Standards Act, and the implementing regulations at 29
C.F.R. §§6.57 and 7.1 (1999).
BACKGROUND
The facts are stated in detail in the R. D. and O. at pp. 4-11 and 14-15, and will
be summarized only briefly here.
In 1990, Sundex held three contracts with the Department of Defense: (1) a
contract for the repair and replacement of concrete floor slabs at the Army Research, Development
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and Engineering (RD&E) Center in Natick, MA, Contract DACA33-89-B-0083 (the "concrete
slabs contract"); (2) a contract for the construction of handicap access ramps at the same Army
RD&E Center, Contract DAAK60-89-C-1059 (the "access ramps contract"); and (3) a
contract for the construction of helicopter pads in Moscow and Columbia Falls, Maine, Contract
F27604-88-C-0036 (the "helicopter pads contract"). See CX (Complainant
Administrator Exhibit) 2. It is undisputed that all three contracts were subject to the DBA and
CWHSSA. The Administrator alleged a series of violations on each of the contracts.
Concrete slabs contract The contract slabs contract at the Army's
Natick, MA, facility was subject to Davis-Bacon wage determination MA89-1, which called for
laborers to be paid an hourly wage ranging from $15.45/hr. (Laborer Class I) to $17.45/hr. (Laborer
Class IV), plus fringe benefits of $4.60/hr. Six employees who worked on the concrete slabs
contract performing tasks such as operating a jackhammer or hauling trash testified that Sundex paid
them only $10 or $12 an hour for work performed during March and April, 1990, with no money
deducted for taxes and no payment of fringe benefits. See T. (transcript of hearing) 37-39;
47-49; 57; 61; 65; 102. However, certified payrolls signed by Bonavire reported that the employees
were paid $15.75/hr. in wages, plus fringe benefits. CX 4. Furthermore, several of the employees
worked more than 40 hours per week, but were paid only at their straight-time rate of pay.
1 There are several small discrepancies
between the number of hours worked (as evidenced by the pay checks) when compared with the
number of hours worked that were reported by Sundex and Bonavire on the certified payroll reports.