[Federal Register Volume 59, Number 5 (Friday, January 7, 1994)]
[Notices]
[Pages 1029-1031]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-328]
[[Page Unknown]]
[Federal Register: January 7, 1994]
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DEPARTMENT OF LABOR
Employment Standards Administration
All-Agency Memorandum No. 174 Under the Davis-Bacon and Related
Acts
AGENCY: Wage and Hour Division, Employment Standards Administration,
Labor.
ACTION: Notice.
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SUMMARY: The Department of Labor (DOL) is publishing All Agency
Memorandum No. 174, which was forwarded to Federal contracting agencies
on December 2, 1993. This memorandum provides guidance concerning the
suspension of ``helper'' regulations under the Davis-Bacon and related
Acts in Fiscal Year 1994, and is being published to inform the public
on policies and procedures now in effect as a result of the suspension.
FOR FURTHER INFORMATION CONTACT:
William W. Gross, Acting Assistant Administrator, Wage and Hour
Division, Employment Standards Administration, U.S. Department of
Labor, room S-3028, 200 Constitution Avenue, NW., Washington, DC 20210.
Telephone (202) 219-8353. This is not a toll-free number.
SUPPLEMENTARY INFORMATION: On Thursday, October 21, 1993, President
Clinton signed the FY 1994 Appropriations Act for the Department of
Labor, Health and Human Services, and Education, and related agencies
(Pub. L. 103-112). Section 104 of this act contains a provision that
prohibits the Department of Labor (Department) from expending funds
appropriated under the act to implement or administer the Davis-Bacon
``helper'' regulations at 29 CFR sections 1.7(d), 5.2(n)(4) and
5.5(a)(1)(ii). As a result, these regulations were suspended and former
rules concerning conformance procedures were reinstated at 29 CFR
5.5(a)(1)(v). (See Federal Register 58 FR 58954, (November 5, 1993).)
The Wage and Hour Division routinely uses an ``All Agency Memoranda''
procedure to advise procurement agencies of applicable policies and
procedures in the administration and enforcement of the labor standards
requirements of the Davis-Bacon and related Acts. In this regard, All
Agency Memorandum No. 174 provides guidance to procurement agencies on
the suspension of ``helper'' regulations during FY 1994. Because of the
interest in the use of helpers under the Davis-Bacon and related Acts,
All Agency Memorandum No. 174 is published for general information.
Document Preparation
This document was prepared under the direction and control of Maria
Echaveste, Administrator, Wage and Hour Division, Employment Standards
Administration, U.S. Department of Labor.
Signed in Washington, DC, on this 30th day of December, 1993.
Maria Echaveste,
Wage and Hour Administrator.
U.S. Department of Labor, Employment Standards Administration,
Wage and Hour Division.
December 2, 1993.
Memorandum No. 174
Memorandum for All Contracting Agencies of the Federal Government and
the District of Columbia
From: Maria Echaveste, Administrator
Subject: Prohibition on Department of Labor Implementation/
Administration of Davis-Bacon Helper Regulations Pursuant to Fiscal
Year (FY) 1994 Appropriation Act
On Thursday, October 21, 1993, President Clinton signed the FY 1994
Appropriations Act for the Department of Labor, Health and Human
Services, and Education, and related agencies (Pub. L. 103-112).
Section 104 of this act contains a provision that prohibits the
Department of Labor (Department) from expending funds appropriated
under the act to implement or administer the Davis-Bacon ``helper''
regulations that were previously codified at 29 CFR 1.7(d), 5.2(n)(4)
and 5.5(a)(1)(ii). (See Federal Register, 54 FR 4234, 55 FR 50148, and
57 FR 28776). Those regulations have therefore been suspended and the
former rules reinstated. (See Notice of suspension of regulations and
reinstatement of former regulation published in the Federal Register on
November 5, 1993 (58 FR 58954), copy attached.
As of October 21, the Department of Labor ceased activities that
were related to the administration and implementation of suspended
helper regulations. The discontinued activities included:
Issuing classifications and wage rates for helpers in wage
determinations based on data yielded by new surveys.
Processing survey data to determine whether the use of
helpers is prevailing on construction in areas where Davis-Bacon
surveys are being conducted to determine prevailing wage rates for any
particular type of construction.
Processing requests for the approval of additional
classifications and wage rates for helpers pursuant to the suspended
conformance procedures formerly set forth in 29 CFR 5.5(a)(1)(ii).
Processing requests for the reconsideration of rulings or
final determinations concerning the use of helper classifications and/
or wage rates.
Guidance regarding the effect of the newly enacted prohibition on
contracts at various stages of the procurement process follows.
Contracts awarded on or after October 21, 1993.\1\
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\1\In the case of projects assisted under the National Housing
Act, the applicable date is the start of construction or the initial
endorsement of the mortgage, whichever occurs first. Similarly, in
the case of projects to receive housing assistance payments under
section 8 of the U.S. Housing Act of 1937, the applicable date is
the beginning of construction or the date the housing assistance
payment contract is executed, whichever occurs first.
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Contractors and subcontractors may not employ ``helpers'' as that
term was defined in Sec. 5.2(n)(4) of the suspended regulations on any
Davis-Bacon covered contract awarded on or after October 21, 1993.
Semi-skilled helper classifications and wage rates that were issued in
wage determinations pursuant to the suspended regulations and that have
been included in contracts awarded on or after October 21, 1993, are
not valid. Moreover, the regulatory provision that allowed the
consideration of additional classification actions for helpers is
suspended; therefore, the Department will not consider any additional
classification requests that would permit the use of helpers as defined
in the suspended regulations on such contracts. Davis-Bacon general
wage determinations are being modified to omit those helper
classifications and wage rates that were issued pursuant to the
suspended regulations.
In accordance with its prior practice, the Department will,
however, recognize helper classifications that are separate and
distinct classes of workers performing duties distinguished from those
of journey-level workers or other classifications listed on the wage
determination; whose use prevails in an area; and who are not employed
in an informal apprenticeship or training capacity. As detailed in the
November 5, 1993, notice, the Department will issue such helpers on
wage determinations or consider additional classification requests for
such helpers where these criteria are met and a specific description of
duties is associated with the particular helper class. Helpers may be
employed on contracts awarded after October 21, 1993, only if a
definition of the helper's duties establishing the helper as a separate
and distinct classification is set forth in the wage determination or
on the additional classification approval documents.
Contracts awarded prior to October 21, 1993 where the contract
contains the newly-suspended helper clauses and the contract wage
determination contains a helper classification or a helper
classification has been approved for use on the project.
Contractors and subcontractors may continue to employ individuals
in helper classifications that were issued for application to contracts
or approved for use on contracts awarded prior to the suspension of the
regulations. The workers must, however, be employed in accordance with
the regulatory definition set forth in Sec. 5.2(n)(4) of regulations,
part 5, which was applicable at the time the contract was awarded, and
the workers must be paid at least the corresponding wage rate for the
helper classification in which they are performing.
The Department will continue to take action to ensure that workers
erroneously classified as helpers are reclassified as journey-level
workers or laborers in accordance with the work performed (those cases,
for example, where employees perform work solely of a skilled nature,
where individuals do not work under the supervision and direction of a
journey-level classification, or where workers perform duties beyond
the duties performed by helpers pursuant to the practice in the area).
The Department will also take enforcement action against any contractor
or subcontractor that fails to compensate its helpers according to the
applicable wage determination rate or approved conformance wage rate.
Contracting agencies are also reminded of their enforcement
responsibilities under Reorganization Plan No. 14 of 1950 and
encouraged to take action as may be necessary to ensure compliance in
such situations.
Contracts awarded prior to October 21, 1993 where the contract
contains the newly-suspended helper clauses but the contract wage
determination does not contain a helper classification and a helper
classification has not yet been approved for use on this project.
Contractors and subcontractors may not employ any classification,
including helpers, on a Davis-Bacon covered project unless the wage
determination contains the classification or the classification is
approved pursuant to the Department's additional classification
procedures. The regulations provide that the wage rates determined for
unlisted classifications under the additional classification procedures
shall be paid to all workers performing work in that classification
from the first day on which work was performed. This regulatory
provisions permits retroactive application of approved additional
classifications and wage rates and, at the same time, also allows for
retroactive enforcement action against a contractor or subcontractor
whose proposed additional classification and/or wage rate is denied by
the Department.
Clearly, the Department cannot act on conformance requests for
helpers or requests for reconsideration of such conformance actions
given the Congressional action. Thus, contractors or subcontractors who
classify and pay individuals as helpers with the expectation that the
Department will approve an additional classification request at some
future point place themselves at risk of subsequent enforcement action,
including the withholding of contract funds. Under these circumstances,
agencies should use their enforcement discretion in determining whether
withholding action is appropriate to protect the interest of employees
where contractors pay individuals less than the journey-level rate
during the period of the prohibition. Agencies clearly should withhold
contract funds where the Department has denied a conformance request,
even through the contractor or subcontractor may have or may intend to
request reconsideration of the additional classification denial.
Agencies should also withhold contract payments on any contracts
completed or nearing completion during the suspension of the helper
regulations so that any back wages potentially due employees are not
lost because the contract was closed and contract funds paid out.
Contracts awarded prior to October 21, 1993 where the contract does
not contain the revised helper clauses.
In implementing the helper regulations after the lifting of the
prohibition imposed by section 303 of the 1991 Dire Emergency
Supplement Appropriation Act, the Department suggested that contracting
agencies modify existing contracts to include the revised helper
contract clauses, thereafter permitting the addition of helper
classifications through the additional classification procedures in
Sec. 5.5(a)(1)(ii) of regulations, part 5. However, in light of the
Congressional action, that option no longer exists for contracts that
were awarded without the helper contract clauses and which have not yet
been modified. Contractors and subcontractors performing on such
contracts may not employ helpers as those classifications were defined
by Sec. 5.2(n)(4) of regulations, part 5.
Prior background concerning the regulations in question is
contained in All Agency Memoranda Nos. 154, 161, 163 and 165, issued on
January 2, 1991, January 29, 1992, June 22, 1992, and July 24, 1992,
respectively. Application of these All-Agency Memoranda is also
suspended.
Agencies are reminded of the need to make appropriate changes in
the procurement regulations (see especially 48 CFR 22.406-3, 52.222-
6(b) and 52.222-9) and related contract documents to conform to the
revised regulations.
[FR Doc. 94-328 Filed 1-6-94; 8:45 am]
BILLING CODE 4510-27-M
