Joe E. Woods, Inc., ARB No. 96-127
(ARB Nov. 19, 1996)
U.S. Department of Labor Administrative Review Board
200 Constitution Avenue, N.W.
Washington, D.C. 20210
ARB Case No. 96-127 (Formerly WAB CaseNo. 95-12) DATE: November 19, 1996
In the Matter of:
JOE E. WOODS, INC.
With respect to reconsideration of
Wage Determination No. 92-OR-0019, issued
for application to the construction of 84
units of duplex and triplex housing in
Astoria, Clatsop County, Oregon, (U.S.
Department of Transportation, Coast Guard
Contract No. DTCG50-92-C-643B29)
This matter is before the Board pursuant to the
Davis-Bacon Act, as amended (DBA), 40 U.S.C. § 276a et seq., and 29
C.F.R. Part 7. On May 3, 1996, Petitioner Joe E. Woods, Inc. (Woods) filed a petition
seeking review of the April 4, 1996 final ruling issued by the National Office Program
Administrator (Administrator), Wage and Hour Division (Wage and Hour). For the following
reasons, the Petition for Review is denied and the Administrator's ruling is affirmed.
BACKGROUND
[Page 2]
On March 18, 1992, the United States Coast Guard (Coast Guard)
requested a wage determination for construction of 84 units of duplex and triplex housing (the
Project) in Astoria, Oregon. The request form filed by the Coast Guard described the work
as "residential." Wage and Hour responded to the request and issued a wage
determination consisting of two parts: (1) an area General wage determination (No. OR91-1)
containing heavy and highway rates applicable to site work (e.g. streets, utilities,
and grading); and (2) a residential wage determination, No. 92-OR-0019. Administrative
Record (AR) Tab S, Enclosure 2B. Wage Determination No. 92-OR-0019 provided for
"a residential schedule of hourly wage rates and fringe benefits for twelve classifications
ranging from $5.76 for laborers to $12.50 (plus fringe benefits) for electricians."
Administrator's Statement (AS) at 3. Thus, the two-part wage determination indicated that
heavy and highway rates as well as residential rates would apply to the Project.
The Coast Guard issued an Invitation For Bids (IFB), DTCG-92-B-64329
on April 13, 1992. The IFB stipulated that "[r]esidential, for the purposes of
these wage rates, means for work actually done on the buildings, to include site preparation
for the building footprint." IFB, Subsection L.11(a). On May 28, 1992, the Coast
Guard awarded Contract No. DTCG-50-92-C-643B29 for construction of the Project to
Woods. Prior to submitting its bid, Woods's representatives traveled to the Project's site in
Astoria, Oregon, investigated the job site conditions and spoke with potential subcontractors
and suppliers for the Project. Letter from Gaona & Haynes to Mr. William Denman, USCG,
January 4, 1995. Both the amount of the hourly wage determination and the classification as
residential' played a part in the method in which Woods bid the project. Affidavit of James
V. Johnson, P.E.
Woods commenced performance of the contract but began to incur
labor costs at rates in excess of the Project's wage determination rates. On January 31, 1994,
nineteen months after the contract was awarded, Woods submitted two Requests for Equitable
Adjustment (REAs) of the wage determination to the Coast Guard. Woods claimed that it was
influenced during the bidding process by the inaccuracy of the wage determination and that
Wage and Hour's classification of the project should have been based on construction
techniques (i.e. building or heavy) rather than on end use (i.e.
residential). The Coast Guard rejected both REAs.
In a letter dated April 27, 1995, the Coast Guard requested a
ruling from Wage and Hour on the correctness of the Project wage determination. On August
31, 1995, Wage and Hour issued a final determination letter in response to the Coast Guard's
request for reconsideration of the wage determination, finding that there was no legal basis for
rescinding the wage determination. On September 20, 1995, Wage and Hour forwarded the
ruling letter to Woods, which timely filed a Petition for Review with the Wage Appeals Board
1 On April 17, 1996, a Secretary's
Order was signed redelegating jurisdiction to issue final agency decisions under this statute to the
newly
created Administrative Review Board. 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
Administrative Review Board now issues final agency decisions. Final procedural revisions to
the
regulations implementing this reorganization were also promulgated on that date. 61 Fed. Reg.
19982.
3 At one time, Woods's
representative, arguing for only one "residential" wage determination for the Project,
stated that the Project "is the construction of duplex housing units;" that "these
homes
are located on a single site;" and that "the streets and utilities are completely located
within
the subdivision and incidental to the construction of the homes." AR Tab T, July 30 1992
letter
of Chris G. Evans, General Manager, Joe E. Woods, Inc.
4 Another exception, permitting
retroactive wage determination adjustment, is the provision at 29 C.F.R. § 1.6(d), allowing
for
correction of clerical errors. This provision has no applicability on the facts of this case.
5 Where, due to unanticipated
work
or oversight, a job classification necessary to complete the work is not included in the wage
determination, a contractor may seek additional classifications through the conformance process.
The
regulations governing the conformance procedure are set published at 29 C.F.R. §
5.5(a)(1).
For a conformance request to be approved, it must satisfy the following three criteria: (1) the
work
to be performed by the classification requested is not performed by a classification in the wage
determination; (2) the classification is utilized in the area by the construction industry; and (3)
the
proposed wage rate, including any bona fide fringe benefits, bears a reasonable
relationship
to the wage rates contained in the wage determination. Clark Mechanical
Contractors,Inc., supra. The Administrator is given broad discretion to accept or
reject any given conformance request. However, the conformance procedure is not intended to
be a
substitute process for challenging wage determinations in a timely manner.