Appendix — Saavedra v. Donovan

Supreme Court brief1983

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483

SUPREME COURT OF THE UNITED STATES ,

OCTOBER TERM, 1982 Saar

GUILLERMO A. SAAVEDRA,

individually and doing business

as SAAGAN MOVING & STORAGE COMPANY,

Petitioner,

Vv.

RAYMOND J. DONOVAN, Secretary

of Labor,

Respondent.

APPENDIX T

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

JERRY K. CIMMET

Civic Center Building

507 Polk Street, Suite 250

San Francisco, CA 94102

Counsel of Record for

Petitioner

Guillermo A. Saavedra,

individually and doing

business as Saagan Moving

& Storage Company

INDEX TO APPENDIX

Appendix

Appended Materials Designation

OPINION OF THE UNITED STATES

COURT OF APPEALS FOR THE NINTH

CIRCUIT (February 4, 1983) A

ORDER OF THE COURT OF APPEALS

DENYING PETITION FOR REHEARING

(April 15, 1983) B

DECISION AND ORDER OF

ADMINISTRATIVE LAW JUDGE C

DECISION OF THE ADMINISTRATOR C=]

MCNAMARA - O'HARA SERVICE

CONTRACT ACT, 41 USC §§ 35l-

358 (relevant sections) D

DEPARTMENT OF LABOR

REGULATIONS, 29 CFR, Parts

4 and 6 (relevant sections)

APPENDIX A

OPINION OF THE UNITED STATES COURT

OF APPEALS FOR THE NINTH CIRCUIT

(February 4, 1983)

IN THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

GUILLERMO A. SAAVEDRA, FILED

individually and doing FEB 4 1983

business as SAGAAN PHILLIP B.

MOVING & STORAGE WINBERRY

COMPANY, CLERK, U.S.

COURT OF

APPEALS

Plaintiff-Appellant,

vs. No. 82-4130

DC# C-80-591-

RAYMOND DONOVAN,

RHS

Secretary of Labor,

et al.,

)

) OPINION

)

Defendants-Appellees.

Appeal from the United States

District Court

for the Northern District

of California

District Judge Robert H.

Schnacke, Presiding

[Argued and Submitted January 10, 1982]

Before: DUNIWAY, WRIGHT, and CHOY, Cir-

cuit Judges:

WRIGHT, Circuit Judge:

The Service Contract Act of 1965,

41 U.S.C. §§ 351-358 (the Act), mandates

minimum wages and fringe benefits for

employees engaged in government contract

work. Its purpose is to protect employees

of government contractors. Before the

Act, the federal government had been

"subsidizing" substandard levels of com-

pensation by awarding contracts to those

who were able to bid low by paying less.

American Federation of Government Em-

ployees, Local 1668 v. Dunn, 561 F. 2d

1310, 1312 (9th Cir. 1977).

The Act requires the Secretary

of Labor (Secretary) to determine wages

and benefits by job category and geo-

graphic area ("wage determinations").

Contracts subject to the Act must incor-

porate the appropriate wage determina-

tions. 41 U.S.C. § 35l(a), (b).

Plaintiff-appellant Saavedra,

dba Saagan Moving and Storage Co., was

awarded two government contracts which

were subject to the Act. He is not

-2-

proficient in English and did not fully

understand the contracts or even read

them thoroughly. He based his bid for

the first contract on an irrelevant set

of figures occurring early in that docu-

ment. Being unaware that he had to

provide fringe benefits, he failed to do

so.

The Department of Labor brought

an enforcement proceeding. The

Administrative Law Judge (ALJ) concluded

that Saavedra was bound by and had

violated the wage determination and must

recompense the affected employees.

But he thought the contracts confusing,

sloppy, and rife with mistakes. Pro-

visions that he thought ambiguous as to

computation of amounts due he interpreted

in Saavedra's favor.

Both parties excepted to the

ALJ's decision, which triggered recon-

=3-

sideration by an administrator. He set

aside the ALJ's resolutions of ambiguities 2

in Saavedra's favor and chose the De-

partment's methods of computation. The

Secretary adopted the administrator's

decision.

Saavedra challenged the final

decision in district court where summary

judgment was granted to the defendants.

Saavedra appeals.

I. Standards of Review

Proceedings to enforce labor

standards of the Act are on the record.

See 29 C.F.R. §§ 6.10, 6.14. These

proceedings are governed generally by

the Administrative Procedure Act (APA).

See 5 U.S.C. §$§ 556, 557, 706.

A. Review Under the APA

Under the APA's judicial review

provisions, a court must set aside agency

decisions that are "unsupported by

-4-

substantial evidence" or "arbitrary,

capricious, and abuse of discretion, or

otherwise not in accordance with law.”

Id. § 706(2)(A), (E).

The standard does not change

merely because the final decision re-

jects the ALJ's determinations. Loomis

Courier Service, Inc. v. NLRB, 595 F.2d

491, 495 (9th Cir. 1979). The decision

for court review is that of the agency,

here the administrator's decision adopted

by the Secretary. The court does not

review the ALJ's decision, which is merely

part of the record. Penasquitos Village

v. NLRB, 565 F.2d 1074, 1076 (9th Cir

1977).

But the court must take into

account the "whole record." Id.; 5

U.S.C. § 706. Because the ALJ's factual

findings are part of that record, con-

trary agency findings are given less

-5-

weight than they would otherwise receive.

Universal Camera Corp. v. NLRB, 340

U.S. 474, 496 (1951); Nelson v. Interior

Board of Land Appeals, 598 F.2d 53l,

534 (9th Cir. 1979). This principle has

greatest force, however, with credibility

determinations from demeanor evidence,

not at issue here.

B. Special Standards for Service

Contract Proceedings

The APA treatment is modified

by laws governing enforcement proceedings

under the Act. The Secretary's findings

of fact, if supported by a preponderance

of the evidence, are conclusive on the

courts. 41 U.C.S. §§ 39, 353(a).

A regulation binding on the

agency provides: "With respect to

[the ALJ's] findings of fact, the Ad-

ministrator shall modify or set aside

only those findings that are clearly

-6-

erroneous.” 29 C.F.R. § 6.14. Findings

are clearly erroneous if, though there

may be evidence to support them, the

reviewer has the definite conviction

they are mistaken. Thomas v. SS Santa

Mercedes, 572 F.2d 1331, 1335 (9th Cir.

1976).

II. Application of the Standards of Review

Because wage determinations are

creatures of contract and statute, this

case presents a mix of contract law and

administrative law. The ALJ followed

contract law.

Federal law controls when inter-

preting a government contract. In

fashioning federal rules, guidance is

gained from general principles for

interpreting contracts. United States

v. Seckinger, 397 U.S. 203, 209-11 (1970).

Once the ALJ decided that provisions

in the contracts affecting the amount

=J=

Saavedra owed were ambiguous, he applied

the "contra proferentem" rule of construc-

tion, interpreting ambiguities against

the drafter, the government. See id.

at 210, 216.

The administrator concluded

the contra proferentem rule was inapposite

and applied administrative law. He

reasoned that, because Saavedra did not

know of these terms when he submitted

his bid and had not paid even the lesser

amount, he had not relied on his inter-

pretation and was not prejudiced by the

imperfections. See, e.g., Dale Ingram,

Inc. v. United States, 475 F.2d 1177,

1165 (Ct. Cl. 1973).

He agreed with the government's

argument that ambiguities should not be

interpreted against Saavedra's employees,

the intended beneficiaries of the pro-

visions and the Act. Accord, Restatement

-8-

(Second) of Contracts § 207 (1979) (when

interpreting contracts, a meaning that

serves the publicinterest is preferred).

He reasond that the contracts

incorporated the Act, which mandates use

of the Secretary's wage determination.

Saavedra had a legal duty to conform

:o the actual wage determination, not

just a contractual duty to conform to

plausible interpretations of contract

provisions embodying the wage deter-

mination.

Administrative precedent imposed

on Saavedra a duty to clarify any un-

certainties about the wage determination.

The ALJ found these cases were not

meaningfully available to the public

and in fairness Saavedra could not be

held to them. Saavedra's attorney sub-

mitted affidavits that he could not find

the precedents published.

-9-

The administrator set aside

the ALJ's finding of unavailability,

saying that the Department's decisions

were published and properly indexed in

regular services. He gave published ci-

tations for some relied on.

Moreover, a published regulation

specifies that if doubts arise about

interpreting the wage determination, the

Department should be consulted. 29 C.F.R.

§4.101. Saavedra is charged with such

knowledge.

A. Ambiguities in Method of Compu-

tation

The wage determination specifies

minimum time an employee must work to

qualify for each benefit. It was

drafted with a view to employees who

work exclusively on government contracts.

But Saavedra's employees did commercial

work, too.

-10-

Saavedra argued that only time

spent in contract work went to satisfy

the minimum time requirement. The

Department argued that both contract

and commercial time should be counted

to establish eligibility, with the

benefit prorated to reflect the percent-

tage of time spent on contract work.

The parties disagreed on how

to prorate the benefit. Saavedra con-

tended the percentage should reflect

the ratio of contract time to total

time worked. The Department would use

the ratio of contract time to the

minimum time specified to qualify for

the benefit.

The Department produced a 1970

opinion letter prescribing its method.

A government witness testified that

the letter exemplified the Department's

consistent and longstanding policy.

Saavedra argued that this had

-ll-

to be published before it could bind

him and was therefore void. The ALJ

disregarded the letter. The administra-

tor disagreed.

It is well settled that an

agency may announce and implement new

administrative policy by adjudication.

Montgomery Ward & Co. v. FTC, 691

F.2d 1322, 1328 (9th Cir. 1982). A

fortiori, it should be able to apply

longstanding (though unpublished) policy

in an adjudication.

The administrator was not

obliged to rule for Saavedra simply be-

cause the policy was unpublished. Cf.

Legal Aid Society v. Brennan, 608 F.2d

1319, 1341 n.43 (9th Cir. 1979), cert.

denied, 447 U.S. 921 (1980) (Department

of Labor Technical Guidance Memorandum

entitled to weight because it reflected

the agency's construction, even if not

-12-

binding because unpublished). Courts

accord deference to an agency's reason-

able and conforming interpretation of

its own regulation. Pacific Coast Medical

Enterprises v. Harris, 633 F.2d 123, 131

(9th Cir. 1980).

The opinion letter parallels

the Department's published methods,

which count commercial time in computing

eligibility for annual vacation benefits.

29 C.F.R. § 4.171. Cf. Skidmore v.

Swift, 323 U.S. 134, 140 (1944) (weight

to be given to Department's bulletin

interpreting statutory labor standards

depends in part on consistency with

its other pronouncements). The published

examples are explicitly said to be illus-

trative and not exhaustive. 29 C.F.R.

§ 4.101. |

Saavedra characterizes the Depart-

ment's methods as arbitrary and capri-

-13-—

cious. But with his method of prorating,

an employee with the same contract

hours as others would get a lower benefit

if he put in more commercial hours.

Adopting that method would have been

arbitrary and capricious.

B. Ambiguity Because of Illegible

Number

According to the ALJ, the

monthly health and welfare benefit in

the first contract was ambiguous because

the figure was poorly reproduced.

Though the amount was supposed to be

$88.35, the ALJ computed Saavedra's

liability as $38.35 under the contra

proferentem rule.

The administrator set aside

this part of the ALJ's decision. He

stated that the disputed 8 was obviously

not the same as the 3 in the same figure.

Whether an ambiguity exists is

a question of law. United States v.

-14-

Sacramento Municipal Utility District,

652 F.2d 1341, 1343-44 (9th Cir. 1981).

The administrator concluded there was

no ambiguity here. This he was free to

do. His "clearly erroneous" standard for

reversing the ALJ's factual findings is

inapplicable. Even if the existence

of an ambiguity seems a factual question,

the administrator reasonably thought

the ALJ's finding clearly erroneous.

He buttressed his reversal by

alternatively resolving the legal issues

raised if an ambiguity did exist. See

supra. He added that the contract would

violate the wage determination if read

as did the ALJ. The latter's interpre-

tation resulted in an illegal, sub-

minimum health and welfare benefit. An

interpretation giving a lawful meaning

is preferred. Restatement (Second) of

Contracts § 203(a) (1979).

~15-

CONCLUSION

We too are not favorably im-

pressed with the government's obfuscatory

practices in these contracts. Wage

determinations have significant finan-

cial consequences for government con-

tractors. The Department, having re-

ceived numerous inquiries about the same

provisions that confused Saavedra,

was aware of the problems. A government

agency should set forth clearly its

legal requirements. This one is capable

of doing so, as it demonstrated by

eliminating, in the second contract,

the ambiguity about whether to count

noncontract time when computing eligi-

bility for the health and welfare benefit.

Straightforward notice would

foster the purposes of the Act by

promoting understanding of, planning for,

and expeditious compliance with wage

-16-

and benefit provisions. It would also

save the cost to the public of enforce-

ment proceedings and litigaion against

unwitting violators.

However, a businessman is pre-

sumed to assent to the terms of his con-

tract whether or not he knows of them.

Restatement (Second) of Contracts § 23 &

comment b, § 157 & comment b.

Allowing one to avoid contrac-

tual obligations by failing to read or

understand them would undermine re-

liance on written instruments and, in

this case, disadvantage blameless em-

ployees. Saavedra had a duty to read

the contracts. He owed that to himself,

as he was bound by their terms, read or

unread, and by the extra-contractual

wage determination. His failure to read

prevented him from even discovering

alleged ambiguities, much less detri-

-l17-

mentally relying on his interpretation

of them or clarifying them before con-

tracting.

The Secretary's decision was

not arbitrary nor capricious, was in

accordance with law, and was supported

by substantial evidence. Most of his

reversals of the ALJ were on legal issues.

His conslusions on these conformed to

the Act's purpose and to departmental

policy, published and unpublished.

Reversals of factual findings were limited

to those he reasonably considered clearly

erroneous.

Affirmed.

-18-.

APPENDIX B

ORDER OF THE COURT OF APPEALS

DENYING PETITION FOR REHEARING

(April 15, 1983)

IN THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

GUILLERMO A. SAAVEDRA,

individually and doing

business as SAAGAN

MOVING & STORAGE

COMPANY,

Plaintiff/Appellant,

vs.

RAYMOND DONOVAN,

Secretary of Labor,

et al.»

Defendants/Appellees.

Before: DUNIWAY, WRIGHT,

Circuit Judges:

) FILED

) APR 15 1983

) PHILLIP B.

) WINBERRY

) CLERK, U.S.

) COURT OF

) APPEALS

)

)NO. 82-4130

) D.C. No.

) C-80-591-RHS

) (Northern

>. Caisse.)

)

) ORDER

and CHOY,

The petition for Rehearing,

filed with the Clerk on February 18, 1983,

has been considered and is denied.

APPENDIX C

DECISION AND ORDER OF ADMINISTRATIVE

LAW JUDGE

U.S. DEPARTMENT OF LABOR

OFFICE OF ADMINISTRATIVE LAW JUDGES

Suite 700-1111 20th Street, N.W.

Washington, D.C. 20036

211 Main Street, Suite 600

San Francisco, California 94105

(415) 556-0555

In the Matter of

G. A. SAAVEDRA,

INDIVIDUALLY, d/b/a/

SAAGAN MOVING &

STORAGE COMPANY,

NO. SCA-717-718

Respondent

Jerry K. Cimmet, Esquire

Milano & Cimmet

Civic Center Building

507 Polk Street

San Francisco,

California 94102

For the Respondent

FILED AS PART

OF THE RECORD

10 APR 1978

Dated

/s/H. STEPHAN GORDON

Chief Judge

Sandra Rogers, Esquire

Department of Labor

450 Golden Gate Avenue

Room 10404

San Francisco,

California 94102

For the Government

Before: THOMAS SCHNEIDER

Administrative Law Judge

DECISION AND ORDER

«zhis proceeding arises under the

McNamara-O'Hara Service Contract Act,

41 U.S.C. § 351 et seg., hereinafter,

the "Act." Complaint was filed by the

Regional Solicitor of Labor on August

30, 1977, alleging that Respondent

violated the Act by breaching the pro-

visions of two contracts for moving

services identified as GS-09T-67

(hereinafter "contract 38") and GS-

O9T-67 (hereinafter "contract 67").

The essence of the complaint is that

Respondent failed to pay employees doing

work on each of the contracts the fringe

benefits called for by the applicable

wage determination. Respondent answered

and raised various affirmative defenses.

The issues thus framed are: (1) how the

amounts for which Respondent is liable

under the Act are to be determined and

(2) whether unusual circumstances exist

w2«

which should relieve Respondent from the

debarment provisions of 410U.S.C. &354(a).

A hearing was held in San Francisco,

California, on November 9, 1977. The

record was held open to March 6, 1978,

for the submission of futher evidence

and briefs. The subsequently received

documents were received in evidence and

consist of 53 pages of computation

sheets, marked Secretary's Exhibit 13,

a summary of unpaid wages, marked

Secretary's Exhibit 14, and a recap

sheet marked Secretary's Exhibit 15.

Findings of Fact and Conclusions of Law

Negotiations, Contract Documents,

Investigation

The Solicitation, Offer, and

Award for Contract 38 was prepared in

part on Standard Form 33, (Nov. 1969).

The Solicitation was issued on or about

April 28, 1975, and the offer was signed

by Respondent on or about June 3, 1975.

The award indicates it was signed for

aZeo

the United States by Hugh McLuskie on

June 20, 1975. The original contract

was introduced as Secretary's Exhibit

#1, and contains several flaws. Al-

though page 1 indicates it is one of

20 pages, in fact there are 27 pages

since GSA Form 2166 (2 pages) and GSA

form 2952 (5 pages) are attached. The

amount of award is written as $95,000,000

although it was obviously intended to

be $95,000.00. Page 3 and 4, entitled

"Solicitation Instructions and Condi-

tions" are poorly reproduced so as to

be difficult to read. Page 6 incor-

porates by reference the text of the Act

appearing on GSA Form 2166 which is re-

produced poorly so as to be difficult

to read in part. The rest of page 6

is legible but confusing. It whe

forth the wages and fringe benefits

that would be paid truck drivers,

onl

helpers, and packers if they were paid

by the federal government under 5

U.S.C. § 5341. This is confusing be-

cause these wages have nothing to do

with wages under the contract. They

are set forth merely as illustrations

of what one employer (the U. S.) would

pay for presumably similar work. A

government witness testified that bidders

often have questions about this page.

In fact, testimony before the House sub-

committee considering the Act prior to

its passage warned that these figures

would be confusing. Shlemon, "The

Service Contract Act - A Critical

Review," 34 Fed. Bar J. 240, 247 (1975).

Respondent testified that it

is these figures on page 6 that he used

in preparing his bid, and I credit this

testimony because he had no conferences

with any government official prior to

submitting his bid on contract 38.

=5=

Pages 7 and 8 are "Exceptions

and additions to Standard Forms 33 and

33A, (cont'd)" and are more or less

legible. Pages9, 10, 11, 12, 13 anc 14

are “Supplemental provisions" and fairly

legible. Pages 15, 16 and 17 appear to

be continuations of the Supplemental

provisions, but are also the pages on

which the offeror (bidder) puts in his

figures on the basis of which it appears

that the award will be made, and fills

in the name, address and telephone num-

ber of a person to be contacted. These

pages are legible. Page 18 is the wage

determination (No. 66-190(Rev.9)

Dated: August 30, 197_ [last digit

illegible]) which the government con-

tends is applicable here. In addition

to being poorly reproduced so tak some

words are difficult to read, it contains

at least two substantive errors on its

face. (1) It specifies the same minimum

o6=

hourly wage ($7.19) for a helper as for

a foreman, and (2) numbers which obviously

refer to footnotes under columns for

Minimum Hourly Wage, Health and Welfare,

Vacation, Holiday, and Pension go from

1 to 5, but the footnotes only go from

1 to 4. It appears from the evidence

that it was intended that each of the

numbers from 1 th 4 should have been

moved to the right one column, and that

the number 5 should have been omitted.

Furthermore, the first figure

of the text at footnote (1), (which

should have referrec to Health and

Welfare but literally referred to Mini-

mum Hourly Wage) was so unclearly written

that although the government contends

that it says "88.35" a government wit-

ness admitted it might be read as "SasaS,"

and the compliance officer pencilled in

"$88,35" on his copy of the contract

to make it more legible.

-7-

Pages 19 and 20 of the contract

are out of order (page 20 preceded

page 19 in the collated document) and

are wage determination 66-491 (Rev.8).

The inclusion of this wage determination

is confusing for the same reason that

page 6 is confusing, i.e., that it

refers to wages for Marin County which

have no relevance to the work bid for

by Respondent, which is for San Francisco

County only. Even a government witness

was confused by this. See Tr. 15:2l-

16:10. The remaining seven pages are

printed forms previously described.

Respondent testified that he

did not receive page 18 until after he

made his bid. I do not credit his testi-

mony in this respect because he later

admitted he was not sure and because

page 18 is on the other side of page

17, which contains blanks that appear

-8-

to have been filled in prior to the

submission of the bid. Although there

was conflicting testimony, the following

is the most credible account of pre-

award negotiations:

In the week prior to June 20,

1975, Mr. Orange, who at the time assisted

the contracting officer, Mr. McLuskie,

and Respondent had a meeting. Fringe

benefits were not discussed at this

meeting. However, since Respondent's

bid seemed low, Mr. Orange called

Respondent's attention to the minimum

hourly wage set forth on pace 18. In

fact, except for two relatively insig-

nificant instances, Respondent paid those

wages. Respondent had calculated his

bid on the much lower wages shown on

page 6 of the contract. Shortly after

this meeting, and prior to receiving

written notice of the award of the con-

=9-

tract, Respondent called the contracting

officer, Mr. McLuskie, in an attempt

to withdraw his bid. Respondent testi-

fied that his reason for attempting to

withdraw was other work and not his mis-

calculation on his bid, but the inference

seems reasonable that the miscalculation

was nevertheless a contributing reason.

In any event, Mr. McLuskie threatened

Respondent with "something like if I

didn't perform or he will see that I

will get -=- he will get me broke to the

point where I won't have any place to

sleep.” Tr. 186:15-18.

The bid was not withdrawn and

the written award is dated June 20, 1975.

There were two subsequent

changes to contract 38. The first,

dated October 24, 1975 changed page 18,

the allegedly applicable wage determina-

tion, to reflect that foremen should

get paid more than helpers. The second,

-10-

dated March 26, 1976, made some changes

not relevant here.

Mr. Lawrenz, a Department of

Labor compliance officer started investi-

gating Respondent's compliance with

contract 38 in May 1976. By May 27,

1976, the date when Respondent submitted

his offer on contract 67, the government

was holding $9,000.00 from Respondent

on contract 38. In order to stay on

the list of firms to which solicitations

are sent Respondent decided to bid on

contract 67. His bid was substantially

higher than his previous bid, and he

did not expect to get the award. He

was not specifically informed of viola-

tions on contract 38 until June ll, 1976,

about two weeks after submitting his

bid on contract 67. The award was signed

for the United States on June 14, 1976.

-ll-

Contract 67 is completely

legible. In marked distinction to

contract 38 it bears the following

language on the first page: "The

Service Contract Act of 1965 applies

to this solicitation and the contractor

and or subcontractor must pay the wages

and fringe benefits as shown on Wage

Determination on Pages 18 and 19."

Certain ambiguities urged by

Respondent even in contract 67 will be

Giscussed below.

the

wWQ

By the time of the hearin

Government, pursuant to an agreement

with Respondent and his attorney, was

withholding in excess of $39, 000.00.

(Secretary's Exhibit 15.) The first

group of issues to be decided is by

what formulas the amounts owing to the

several employees should be determined.

The second issue is whether special

@l12-

circumstances exist to warrant a recom-

mendation that Respondent not be debarred

from further ounces wails pursuant

to 41 U.S.C. § 354(a); 29 C.F.R. § 6.10

(b).

Interpretation of the Contracts

CONTRACT 38

Respondent first argues that he

is not bound by the wage determination

on page 18 of contract 38 because he

relied on the wages shown on page 6;

and that even though he paid no fringe

benefits, as such, his wage payments

exceeded the wage payments plus fringe

benefits set forth on page 6. Thus, page

6 lists truck drivers as receiving

$6.20 per hour plus 9 percent for re-

tirement, insurance and health, plus

certain holiday leave, sick leave and

vacation leave. $6.20 plus 9 percent

equals $6.20 plus .558 or $6.758 per

-13-

hour. Respondent actually paid his

truck drivers $7.165--well in excess of

the amount shown on page 6, even including

the various leave benefits.

The Act permits equivalent or

differential payments in cash in lieu

of fringe benefits. 41 U.S.C. § 351(a)

(2). However, Respondent knew at least

of the minimum wage requirements (if

not the fringe benefit requirements)

of page 18 prior to award and cannot

subsequently claim reliance exclusively

On page 6. Furthermore, 29 C.F.R.

§ 4.170(a) states: "When an employer has

not made any provisions for fringe

benefits, he cannot offset an amount

of monetary wages paid in excess of the

wages required under the determination,

in order to satisfy his fringe obliga-

tion under the Act." Therefore, I con-

clude that he is bound by the wage

-14- —

determination, although not the Solici-

tor's interpretation of it.

Health and Welfare

The compliance officer computed

the amounts underpaid for Health Welfare

on the assumption that the wage deter-

mination required a contribution by the

employer of $88.35 per month for each

employee who has completed 80 hours of

work straight time for the employer in

the previous calendar month, including

both commercial work and work under the

contract. He pro-erated the amount of

contribution due for employees who worked

less than 80 hours in any month on con-

tract work by multiplying $88.35 by a

fraction, the numerator of which is the

number of hours worked on contract

work that month and the denominator

of which is 80.

As previously noted, the amount

-15-

written in footnote (1) on the wage

determination (Secretary's Exhibit l,

p. 18) is unclear. I find that it can

reasonably be read either as $88.35 or

as $38.35. Resolving ambiguities against

the drafter, United States v. Seckinger,

397 U.S. 203, 210, 216 (1970), I conclude

that computations should be based on

$38.35.

The wage determination requires

payments "for each employee who has com-

pleted 80 hours straight time employ-

ment in the previous calendar month."

it does not specify whether the 80 hours

is to include both contract work and

commercial work, as assumed by the com-

pliance officer, or contract work only,

as urged by Respondent. To take one

example, Danny Exon (Secretary's

Exhibit 10, pages A-7, et seg.) worked

more than 80 hours all together in each

-16-

of the seven months from October 1, 1975

through april 1976. However he worked

more than 80 hours on contract work in

Only two of those months, December

and April. Respondent urges that this

employee is entitled to Health and

Welfare benefits only in the two months

following December and April. If the

contract itself specified clearly which

hours count as qualifying, as contract

67 does (Secretary's Exhibit 4, page 18)

there would be no problem. (See p. 10,

below.) If there were a published

regulation specifying the same matter

the parties would be bound by it.

However, contract 38 does not

specify and there is no published

regulation. Instead the Solicitor

relies on a copy of a letter, dated July

10, 1970, from the then Assistant Ad-

ministrator to an attorney whose name

-17«

has been deleted, (Secretary's Exhibit

11). The letter appears to deal with the

instant question as it arose ina

specific case under a prior, presumably

similar, wage determination. It clearly

supports the compliance officer's

approach, urged here by the Solicitor.

It may be evidence of an administrative

practice, but it cannot be binding on a

private citizen. City of New York v.

Diamond, (SDNY 1974) 379 F.Supp. 503,

516, 518. The scheme of the Act as a

whole supports Respondent's contention.

Thus, the Act requires that minimum

wages be paid "in the performance of

the contract," not to all employees who

may sometimes work on the contract,

41 U.S.C. § 351(a) (1). It requires that

fringe benefits be furnished to employ-

ees “engaged in the performance of the

contract," not to all employees of the

contractor. 41 U.S.C. § 35l(a) (2).

-18-

"Service employee" is defined as "any

person engaged in the performance of a

contract..." 41 U.S.C. § 357(£) (emphasis

added). 29 C.F.R. § 4.146 states that

the contractor "is required to comply

with the provisions of the Act and

regulations thereunder only while his

employees are performing on the con-

tract..."

The Solicitor suggests an

analogy to 29 C.F.R. § 4.171(b) (2),

which refers to vacation benefits.

Vacations, which are based on years of

service with an employer may well be

subject to different considerations

than Health and Welfare benefits which

are based on hours worked. Rather than

supporting the Solicitor, the regu-

lation shows that a regulation could

easily be written that would support

him. See Diamond Roofing v. Occu-

@-19-

pational S. & H. Rev. Com'n., (5 Cir.

1976) 528 F. 2d 645, 648-649.

These considerations lead me to

conclude that Respondent was not required

to pay Health and Welfare benefits for

any employee who worked less than 80

hours on contract work during the

previous month.

Of course, Respondent was obliged

to pay into the special (H&éW) Fund, 10

cents per hour for all hours worked on

contract work. There seems to be no

Gispute between the parties on this

point, and the compliance officer made

his computations accordingly.

The parties disagree about how

Health and Welfare benefits should be

prorated for those employees who only

worked on contract work a portion

of the time in any month. The solicitor

urges that the compliance officer did

=20-

it correctly by using a fraction, the

numerator of which is the number of hours

worked (up to 80) on contract work and

the denominator of which is 80. Re-

spondent contends that the denominator

should be the total number of hours

worked on contract and commercial work.

Again, there is neither contract

language nor a regulation that specifi-

cally deals with this issue. The

Solicitor relies on the same letter pre-

viously discussed (Secretary's Exhibit

11). For the same reason it is not con-

trolling here. Since the scheme of the

Act is to assure that employees are

compensated in accordance with certain

standards while working on the contract,

it makes sense to pay Health and Welfare

benefits in proportion to the amount

of work done on the contract in any given

month. This can be computed by using the

@2l@

total number of hours worked as the de-

nominator and the number of hours

worked on the contract as the numerator.

To use 80 as the denominator is ar-

bitrary. Accordingly, I conclude that

the proper way to compute the amounts

underpaid for Health and Welfare (not

including the ten cents per hour for

the special (H&W) fund) each month is

first to determine eligibility by deter-

mining which employees have worked more

then 80 hours on contract work the

previous month. Then, as to those

employees found eligible, to multiply

$38.35 by a fraction, the numerator of

which is the number of hours worked

On contract work in the subject month,

and the denominator if which is the total

number of hours worked both on commer-

cial and on contract work.

o22@

Vacation

The wage determination (Secre-

tary's Exhibit 1, p. 18) provides in part:

"Any employee laid off shall be entitled

to prorate [sic] vacation pay."

"Laid off" has a commonly ac-

cepted meaning which implies something

other than "fired for cause" or "quit."

The American Heritage Dictionary (1976)

defines lay off as follows: "To suspend

from employment, as during a slack

period.” Mr. Orange, a contracting

officer of considerable experience,

testified similarly. Tr. 50:10-16.

There is no reason to interpret this lan-

guage in the contract otherwise. On

the basis of Respondent's Exhibit E,

I find that none of the employees for

whom the compliance officer computed

pro-rated vacation payments under con-

tract 38 were laid off during the term

a33@

of contract 38 so as to be entitled to

pro-rated vacation pay. This leaves only

employees Enele, Graeven, Jones, Mutony

and G. Phillips, each of whom worked for

Respondent for more than a year prior to

the expiration of contract 38, who may

be entitled to some vacation pay in ad-

dition to vacation taken or vacation pay

received.

Since each of these worked for

Respondent for less than three years,

each of them is entitled to "10 working

Gays paid vacation, computed on the basis

96 hours at the straight time rate of

pay." (Secretary's Exhibit l, p. 18).

This computation requires determining the

ratio of contract hours worked to total

hours worked (contract and commercial).

The compliance officer did this approxi-

mately by averaging the monthly percen-

tages. To do it more precisely the

proper procedure is to add up the total

=-24-

number of hours worked (both contract and

commercial) during the contract year and

enter that number as the denominator of a

fraction. The numerator of the fraction

is obtained by adding up the total number

hours worked on contract work during the

contract year. The resulting fraction

is the fraction of time the employee spent

On contract work. The hourly wage rate

called for in the wage determination is

multiplied by 96 hours and then multiplied

by the fraction to obtain the dollar amount

of vacation pay to which the employee is

entitled under contract 38. For example,

Stephen Mutony (Secretary's Exhibit 10,

pp. A-15, et seg.) worked a total of

1653. 25 hours for Respondent in the con-

tract year from July 1, 1975 through June

30, 1976. Of these hours 969.25 were

spent on contract work. The fraction of

time worked on contract work is 969.25

-25-

divided by 1653.25. The hourly wage rate

called for is $7.165. $7.165 X 96 X 969.25

divided by 1653.25 equals $403.25.

This amount is only slightly

different from the $398.95 computed by the

compliance officer. Nevertheless, Respon-

dent is entitled to precision. Of course,

Respondent is entitled to credit for va-

cations actually taken or vacation pay

paid, as the compliance officer correctly

computed.

Holidays

The wage determination (Secre-

tary's Exhibit 1, p. 18) specifies that

there are 11 paid hoidays per year "pro-

vided the employee has been employed by

the employer for at least 13 days in the

month in which the holiday occurs."

The same question arises here as in the

Health and Welfare area, to wit, does

"13 days" refer to both contract and com-

mercial work for the employer or does

it refer to contract work only? Nor is

there anything to suggest whether full

days or partial days are meant. In the

absence of clear contractual language or

governing regulation, Respondent is en-

titled to have such latent ambiguities

resolved in his favor. Accordingly, I

conclude that Respondent was required to

pay holiday pay only for those employees

who worked 104 hours or more (8X13) on

contract work in the month in which the

holiday occurs. With this interpretation

of the wage determination language it be-

comes unnecessary to apportion the amount

paid for holiday pay. If the employee

qualifies for the benefit in any month,

he is entitled to one full day's pay at the

straight time contract rate for eight hours

for any holiday on which he works.

Pension

The wage determination specifies

that pension benefit payments are "3.70

a day for each employee who has worked at

least for hours in that day." The same

ambiguity exists here as with Health and

Welfare and Holiday benefits, i.e., does

the "four hours" refer to four hours of

work done on both commercial and contract

work together, or does it refer only to

work under the contract. Again, absent

clear contract language or specific regu-

lation, Respondent is entitled to have such

amibiguity resolved in his favor. Accord-

ingly, I conclude that Respondent was

required to make a $3.70 payment only to

such employees as worked more than four

hours in any day on contract work,

This precludes the necessity of further

apportioning the amount of contribution.

-28-

Minimum Wage

There appears to be no dispute

between the parties that David Freeman

and Bernd Liebelt were underpaid $30.60

and $31.24 respectively. I find this

underpayment to have been inadvertant and

due to Respondent's method of keeping

track of contract hours.

CONTRACT 67

Health and Welfare

The amounts required to be paid

by the wage determination (Secretary's

Exhibit 4, p. 18) was clearly printed,

i.e., $92.68 a month. Furthermore, this

wage determination specified that: "The

contractor must count the time an employee

has spent working on regular commercial

work as well as time spent on contract

work in determining an employees [sic]

eligibility." Thus, two of the ambiguities

contained in contract 38 have been

eliminated, and there is no occasion for

resolving them.

Respondent contends, however,

that there is no regulatory basis for the

quoted language and that it is contrary

to the intent of the Act. I know of no

authority that requires every word or

phrase or clause of a government contract

to be founded on a regulation. Of course,

a contract must not conflict with the Act,

but the language in question does not

conflict with the Act. 41 U.S.C. § 351l(a)

-_~

(2), in requiring fringe benefit

employees "engaged in the performance of

the contract," does not preclude a computa-

tion that takes into account all the work

an employee does for an employer while

"engaged in the performance of the contract"

only part of the time. As stated in the

discussion of contract 38, supra, I be-

lieve the scheme of the Act would support

@30<

Respondent's contention. But such general

principles do not vitiate express con-

tract language.

The wage determination further

states: "An employee who has worked

80 hours or more in the preceeding [sic]

month is entitled to the listed amount

in the current month of employment re-

gardless of the number of hours so [sic]

worked in the current month." Although

not very clear, the effect of this sen-

tence appears to be twofold: (1) to

Clarify that eligibility depends on work

in the previous month, not in the current

month and (2) to state that an employee

who works 80 hours on contract work is

entitled to the full $92.68 benefit.

The wage determination continues:

"However, an employee who met the 80

hour test but who worked less than 80

hours on contract work would only be

@3le<-

entitled to that pro-rata portion of

the specified amount based on his hours

worked on the contract work." "Pro-rata"

as used here has an ordinary meaning,

namely that the employee who works less

than 80 hours on contract work is entitled

only to that fraction of $92.68, the

numerator of which is the number of con-

tract hours worked and the denominator

of which is the total number of hours

worked on both commercial and contract

work.

I therefore nclude that the

appropriate method for computing Health

and Welfare benefit payments under con-

tract 67 (in addition to 10 cents an

hour for the special (health and welfare)

fund) is (1) to determine which employees

have worked a total of 80 hours 2 a

month on both contract and commercial

work. These employees are eligible for

-32-

some Health and Welfare benefit pay-

ment. (2) Those employees who have worked

80 or more hours on contract work are

entitled to a payment of $92.68. (3)

Those who have worked less than 80 hours

On contract work are entitled to $92.68

multiplied by the number of hours worked

on contract work divided by the total

number of hours worked both on contract

and commercial work.

Vacation

The language regarding vacation

in contract 67 (Secretary's Exhibit 4,

p. 18) is identical to the language in

contract 38. The discussion and conclu-

sion there apply here, except that seven

additional employees of Respondent had

been employed for over one year at the

expiration of contract 67. For each of

them the computations described in re-

spect to contract 38 will have to be

=33-

made. In addition, as the Regional

Solicitor in his letter of December l,

1977, has conceded, it will be necessary

to make adjustments for those employees

who took or were paid for vacations

subsequent to June 30, 1977. Respondent,

if he has not yet done so, should make

the necessary records available to the

Solicitor so that such adjustments can

be made.

Holiday

The language in contract 67

(Secretary's Exhibit 4, p. 18) respecting

holiday benefit payments is identical

to the language in contract 38. There-

fore, the same discusssion and con-

clusions apply.

Pension

The language respecting pension

benefit payments in contract 67 (Secre-

tary's Exhibit 4, p. 18) is identical

-34-

to the corresponding language in contract

38, except that the amount is $4.40

rather than $3.70. Except for this

difference in dollar amounts, the same

discussion and conclusions apply.

Sick leave

Contract 67 (Secretary's Exhibit

4, p. 18) requires certain benefit

payments for sick leave. However, the

Solicitor does not contend that this

portion of the contract has been violated,

Credit for health insurance payments

Commencing in August 1976 the

Respondent had a health insurance plan

available for employees that chose it.

Respondent would contribute one-half

the cost and the employee would con-

tribute the other half. Some employees

had a more expensive plan that covered

families as well as the individual em-

ployee. In both cases Respondent and the

-35-

employee concerned paid equal amounts.

In computing the amount of underpayment

for Health and Welfare by Respondent

under contract 67, he should be given

credit for the contributions he made.

The precise amounts of those contributions

should be made on the basis of Respon-

dent's books rather than his bookkeeper's

testimony. If the relevant figures

from these books are not now available

to the Solicitor, Respondent should

make them available.

Precedents applicable to both contracts

In reaching the foregoing con-

clusions I have not relied on several

decisions by administrative law judges

and by the Assistant Secretary of Labor

which were cited by the Solicitor.

The cited decisions are available to the

public only by name and number and are

not indexed by subject matter. It is

-36-

therefore impossible, from a practical

standpoint, for an attorney to find

decisions that may be favorable to his

client. (This statement is based on an

affidavit by Respondent's counsel which

has not been controverted).

The very able attorneys in the

Solicitor's office may be expected to

be familiar with these decisions because

of their thorough knowledge of the pro-

ceedings that resuJt in these decisions.

It would give the Solicitor an unfair

advantage, in an adversary setting such

as this, to rely on data which only he

has the means of retrieving.

Nevertheless, it is clear that

to some degree Respondent has committed

a violation of the Act, and I so find.

"Unusual Circumstances"

Pursuant to the provisions of

29 C.F.R. § 6.10(b) I hereby recommend

-37-

to the Secretary of Labor that the

Respondent should be relieved from the

application of the ineligible list as

provided in section 5(a) of the Act,

41 U.S.C. § 354(a). I find that the fol-

lowing are unusual circumstances, upon

which I rely as reasons for the recom-

mendation: contract 38 was the first

contract Respondent ever had with the

federal government and contract 67 the

second. When Respondent tried to with-

draw his bid, he was threatened with action

that would cause his bankruptcy. By

the time of his bid on contract 67 he

had not yet been specifically told of

contract violations, but felt duress

because the spb hnins wan withholding

$9,000.00. He was afraid that he would

not get any further government contracts

if he did not submit a bid. When specific

violations were called to his attention,

-38-

and he had assistance of counsei, an

agreement was reached for withholding

sufficient amounts to insure that em-

ployees would be paid all amounts found

due, in accordance with 41 U.S.C. §

352(a). Respondent at the hearing

evidenced the fact that he does not

speak English perfectly. He usually has

only five or six employees and is, like

many people, reluctant to seek an attor-

ney's advice until after problems have

been called to his attention. Further-

more, contract 38 was confusing and

sloppy. Contract 67 was less sloppy

but still contained the ambiguities

discussed above.

Upon consideration of the entire

record in this matter, it is hereby

ORDERED, that the amounts due

from Respondent be computed by the De-

partment of Labor in accordance with the

-39-

principles set forth in the foregoing

decision; that thereafter the amount

withheld in excess of the amounts due

be paid to Respondent; and the amounts

that should have been paid Respondent's

employees be distributed to them, and

any sum not paid to an employee because

of inability to do so within three years

shall be covered into the Treasury of the

United States as miscellaneous receipts

(41 U.S.C. § 354(b)). It is also

RECOMMENDFD, that the Secretary

of Labor take affirmative action to relieve

the Respondent from the ineligibility

list provisions of Section 5(a) of the

Act, 41 U.S.C. § 354(a).

Dated on the 10th day of April,

1978 in San Francisco, California.

/s/ Thomas Schneider

THOMAS SCHNEIDER

Administrative

TS:tl Law Judge

-40-

APPENDIX C-1

DECISION OF THE ADMINISTRATOR

UNITED STATES OF AMERICA

DEPARTMENT OF LABOR

CASE NO. SCA-717-718

U. S. Department of

Labor Office of Ad-

ministrative Law

Judges

FILED AS PART

OF THE RECORD

Feb. 26, 1979

In the Matter of

G. A. SAAVEDRA, an

individual, doing

business as SAAGAN

MOVING & STORAGE .

COMPANY, s/H. Stephan Gordon

Chief Judge

Respondent

DECISION OF THE

ADMINISTRATOR

This is a proceeding under the McNamara-

O'Hara Service Contract Act of 1965 (79 Stat.

1034; 4} USC 351, et seqe), as amended,

he Act. The ree

spondent was charged with having violated the

Act in the performance of two contracts for

moving services, Nos. GS-09T-38 (Secretary's

Exhibit 1) and GS-09T-67 (Secretary's Ex. 4),

hereinafter referred to as contract 38 and

contract 67, respectively.

A hearing was held before an Administrative

Law Judge, hereinafter sometimes referred to

as the Judge. Thereafter briefs were sub-

mitted by the parties. On April 10, 1978,

the Judge issued his decision in the matter.

He found that the respondent violated the

Act and thecontracts by failing to pay em-

ployees who performed the contracts the mini-

mum wages and fringe benefits as required by

wage determinations which were attached to

and part of the contracts. However, the

judge did not agree with the prinicples and

methods employed by the Government in deter-

mining the amounts due the employees on

account of the underpayments. He ordered

that such amounts be re-computed in accordance

with the principles set forth in his decision.

the Judge found that there were “unusual cir-

cumstances" in the case within the meaning of

Section 5(a) of the Act (41 U.S.C. 354(a)),

and therefore recommended that the respondent

be relieved from the ineligible list sanction

provided in that section,

The Government filed exceptions to the deci-

Sion. The repondent responded thereto, and

willie

agency and not the Department of Labor)

was as adamant as can reasonably be ex-

pected in his belief. His "concession"

that another reading is possible is not

convincing and merely concedes that any-

thing can be possible. The Judge was

wrong in relying on this colloguy for

support of the conclusion he reached on

this vital matter.

Furthermore, the Judge knew (Decision, p.

10) that Wage Determination 66-190 (Rev.

-10) which applied to Contract 67 clearly

required $32.68 per month in health and

welfare fringe benefits. It makes no

sense to accept an increase from $33.35 to

$92.68 between one year and the next. It

is more reasonable to presume an increase

from $88.35 to $92.68 over the period.

The Judge could also have requested the

preceding Wage Determination, 66-190

(Rev. -8), which shows the same benefit as

$77.52. By so doing, it would have become

apparent that there was a steady increase

in the rate between October i973 and

September 1975 from $77.52 to $88.35 to

$92.68.

with respect to the monthly amount provided

for health and welfare in contract 38, as

expressed in the above quotation are correct,

for the reasons stated by the Government as

well as those indicated herein. A study of

the configurations of the four digits which

make up the dollar amount per month payable

“ue

for health and welfare appearing at the be-

ginning of footnote 1 of Wage Determination

66-190 (Rev. -9) (page 18 of contract 38,

Secretary's Exhibit 1), particularly a com-

parison of the two digits to the left of the

decimal point with the digit immediately to

the right of the decimal, shows that the two

digits to the left of the decimal are eights

and the one to the right is a three and that

the number which they form is $88.35, rather

than $38.35 as found by the Judge.

The Judge's rationale for adopting the

wage determination was unclear; that it

could reasonably be read either as $88.35

or as $38.35, and that "(rJjesolving ambigui-

ties against the drafter (of the contract]"

computations of the amount due employees

should be based on $38.35. In support of

this conclusion, the Judge cited United

States v. Seckinger, 397 U.S, 203, 210, 216

«$e

(1970) (Decision, p.6, 2d paragraph).

In my opinion, the rule that ambiguity in

a contract should be resolved against the

drafter is not apposite in the circumstances

of this case. Careful reading of the foot-

note in question would make clear that the

amount in question is $88.35, as indicated

above. Moreover, when a contractor enters

into a contract subject to the Service Con-

tract Act he undertakes an obligation to

ensure compliance with the requirements of

the Act, which are incorporated in and part

$ 5 \~ ae

ion 2(a) of the

551(a))s; Secretary's Exhibit

1, paragraph (a) at the top of page 6 and GSA

form 2166 attached to the contract which in-

corporate the Act in the contract.) If he

has any question with respect to such require-

ments he has a duty to inquire of the Depart-

ment of Labor and obtain clarification. See

the decision of the Assistant Secretary of

Labor in Quality Maintenance Co., Inc. et al.

sie

Case No. SCA-119, Dec. 28, 1973 (CCH, Labor

Law Reporter, Wages-Hours, vol. 2, par. 30,906;

BNA, 21 WH Cases 1094); McLaughlin Storage

Inc., et al., Case No. SCA-362-365, Adminis-

trative Law Judge (1975), BNA, 22 WH Cases

711, Administrator (1976), 22 WH Cases 943.

The respondent made no attempt to ascertain

the amount of health and welfare fringe bene-

fit provided in the wage determination. In

fact, he was unaware that the contract re-

quired him to pay employees a health and wel-

fare benefit or any of the other fringe bene-

fits proved in the wage determination, accord-

ing to his testimony. He did not consider

such benefits in making his bid, anc he did

not pay them to the employees. (Transcript

of the hearing, herinafter cited by "T.",

pages 166, 168, 170, 173, 174, 180, 184, 185,

188-190) It is therefore clear that the re-

spondent was not prejudiced in any way by

any imperfection in the printing or format

of the wage determination or in the figures

or wording contained therein.

The Administrative Law Judge's finding

that the wage determination issued by the

Secretary's authorized representative which

was part of contract 38 required a monthly

health and welfare benefit of $38.35 rather

that $88.35, contravenes the provision in

Section 2(a) of the Act and Section 4.170

of the regulations implementing it (29 CFR

4.170) that fringe benefits shall be furn-

ished employees “as determined by the Secre-

tary, or his authorized representative".

(underlining supplied)

In determining the eligibility of indivi-

dual employees to receive the health and wel-

fare benefit, and in computing the amount due

them for such benefit, the Government relied

on the principles set forth in an opinion

letter, dated Julyl0O, 1970, issued by the

Administrator of the Wage and HourDivision,

U.S. Department of Labor (Secretary's Exhibit

ll). The Judge did not consider such opinion

ain

letter binding and declined to follow it,

although he stated that if the principles

contained therein had been incorporated in

the contract or in a published regulation

the parties would have been bound by them,

(Decision, pages 6-8)

The Government contends that it was error

for the Judge to refuse to follow the Adminis-

trator's opinion letter. It states (at pages

3-5 of its exceptions) ;

* * * the Judge's refusal to accept either

the Compliance Officer's formula for

determining employee entitlement or com-

putation of the health and welfare fringe

benefit payable, i.e., taking into con-

sideration both commercial work and work

under the contracts to determine whether

the employee had completed 80 hours of

Straight time work in the preceding

calendar month and then multiplying

$88.35 by a fraction established as total

contract hours over 80, is wrong as a

matter of law and should be rejected. The

Judge acknowledged that an opinion letter

of the Administrator (Secretary's Exhibit

11) “appears to deal with the instant

question" and “clearly supports the com-

Pliance officer's approach" (Decision, p.

6). However, the Judge did not consider

the letter to be binding and, in the

absence of a published regulation in

point, concluded (1) that employee

eligibility depended on the performance

-9-

of 80 hours of contract work in the pre-

ceding month, and (2) that the amount

payable was then determined by multi-

plying $33.35 by a fraction established

as total contract hours worked over total

hours worked, both commercial and

contract.

The Government submits that the exercise

in statutory construction proffered by

Judge Schneider for declining to follow

the opinion letter of the Administrator

(Decision, p. 7) is an_ insufficient

foundation as it is undermined by his

acceptance of the Government's approach

under Contract 67 wherein the Wage Deter-

mination required consideration of both

commercial and contract work in deter-

mining eligibility. If the Judge's

analysis of the scheme of the Act is valid

then logically he ought to have con-

sidered the language in the later Wage

Determination under Contract 67 to be

ultra vires (Decision, pp. 10-11). But he

did not do so, taking the ground from

under his attack on the propriety of the

Administrator's opinion in respect to

Contract 38. The Government theréfore

submits that it was incumbent upon the

Judge to accept the rationale and deter-

minative impact of the Administrator's

opinion letter. See, Matter of Quality

Maintenance Co., Inc., No. SCA-488,

February 16, i977, in which the Adminis-

trator supported the Government” Ss argu-

ment that:

Equally important under the circum-

stances is the accepted legal prin-

ciple that on matters which have not

been heretofore determined by tri-

bunals ‘it is necessary for’ the

Secretary of Labor and the Adminis-

oti.

trator to reach conclusions as to the

meaning and the application of pro-

visions of the law in order to carry

Out their responsibilities of admin-

istration and enforcement (Skidmore

v. Swift, 323 U.S. 134),° 29 CFR

§31.25(a). As the court stated in the

cited case, interrretations of the

Act by those charged with its

enforcement ‘provide a practical

guide to employers and employees as

to how the office representing the

public interest in its enforcement

will seek to apply it' and ‘'‘con-

stitute a body of experience and

informed judgment to which courts and

litigants may properly resort for

guidance.' Id. It has been said that

interpretations of the law issued by

the Administrator are entitled to

great weight in deciding cases,

Gustafson v. Fred Wolferman, Inc., 73

F. Supp. 186 (DC Mo. 1947), and that

due consideration must be given the

Administrator's interpretations,

McComb v. Consolidated Fisheries Co.,

75 F. Supp. 798 (DC Del. 1948), aff'd.

174 F.2d 74. See also Morris v.

Beaumont Mfg. Co., 84 F. Supp. 909

(DC S.C. 1949); Martin v. McAllister

Lighterage Line, 102 F. Supp. 41 (DC

N.Y. 1951), aff'd 205 F.2d 623.

I find that the Judge erred in refusing to

follow the principles enunciated in the opin-

ion letter in question, and in ordering the

eligibility of employees for the health and

welfare fringe benefit and the amounts due

-ll-

them therefor to be computed according to

other principles set forth in his decision.

I believe that the position of the Government

on this question as stated in its exceptions

is proper. In addition to the authorities

cited by the Government, see 77 Am. Jr. 2d,

United States, 6 52, p. 54; Brennan v. Western

Union, 561 F.2d 477, 482, 483 (C.A. 3, 1977).

As noted above in the discussion of the

monthly amount provided in the wage determina-

tion for this benefit, the respondent was not

aware of the requirement to furnish employees

that the methods for determining eligibility

and the amounts payable for such benefits, as

stated in the Administrator's opinion letter

in question, were not published in a regula-

tion or specifically incorporated in the con-

tract. In any event, as indicated above, a

contractor is on notice concerning such obli-

gations, and has a duty to inquire concerning

site

them if he has any questions.

The Government takes exception to the

Judge's finding with respect to employee

eligibility for the holiday fringe benefit,

as follows (at pages 5 and 6 of its excep-

tions):

The same reasoning was used by the Judge

in respect to holiday entitlement to

Strike down the Government's claim

(Decision, pp. 9, 12) as he used to

vitiate the claim for health and welfare

fringe benefits, i.e. the Judge inter-

preted the wage determination requirement

that "the employee has been employed by

the employer for at least 13 days in the

month in which the holiday occurs” to mean

13 full days of contract work. Since it

has been demonstrated, supra, that had

the wage determinations specified that

commercial work also be taken’ into

account the Judge would have decided

differently; that admittedly the question

is identical in the consideration of

eligibility for both types of fringe

benefits; and that the Administrator's

opinion letter enunciates the Depart-

mental interpretation as regards this

issue, the Judge must be reversed in this

regard also. The Government would also

point out that the decision contains

objectionable language in two other

respects relative to this fringe benefit,

which language should be corrected on

appeal. First, employee eligibility for

holiday pay does not, and should not,

require employment for 13 full days. The

entitlement is earned regardless of the

-13-

number of hours worked during any one day.

Only the failure to work any contract

hours during the month precludes’ the

vesting of an entitlement to holiday pay.

While the Judge speaks of resolving

ambiguities in favor of the respondent,

there is just as much reason for resolving

ambiguities in favor of the employees

whom this remedial statute was intended

to benefit. Second, holiday pay is due

all eligible employees and not just those

who actually worked on the specified

holiday, contrary to the language in the

final sentence on page 9 of the decision.

I find that the above quoted views of the

Government concerning the Judge's findings

with respect to employee eligibility for the

holiday benefit are consistent with long-

standing policies, practices, and interpre-

tations of the Department and with the pro-

visions and purposes of.the Act, and they

are proper. (T. 153-155)

The Govenrment contends that the Judge's

finding with respect to employee eligibility

for the pension fringe benefit (at pages 10

and 12 of his decision) is erroneous. The

wage determinations provide for a pension

benefit payment of a specified amount per

day "for each employee who has worked at

ihe

least four hours in that day.",. The Govern-

ment states (at page 6 of its exceptions):

Here, again, a question of interpretation

of a wage determination requirement

specified in terms of hours of work is

presented. The Judge determined that

eligibility for the pension fringe bene-

fit requires four hours of contract work

in any day. For the reasons expressed,

Supra, in respect to the admittedly

identical issue presented in considera-

tion of the health and welfare and holiday

fringe benefits, the Government submits

that employees who worked four hours on

any given day (including commercial work)

are eligible to receive pension benefits

for that day, unless no contract work was

performed on that day. The amount of pen-

sion benefits due for a given day should

be prorated on the basis of the amount of

contract work performed on that day.

Thus, an employee who worked at least four

hours, two hours of which were contract

work, would be acue one-hal of the full

benefit. This is the method utilized by

the Compliance Officer and this method

should be supported by the Administrator.

I find that the view of the Government with

respect to the pension benefit as expressed

in its exception quoted immediately above,

is correct for the reasons indicated therein

and in the discussion of the other fringe

benefits herein above.

The Judge refused to consider prior adminis-

=15<

trative decisions in reaching his conclusions.

The Government argues (at pages 6 and 7 of

its exceptions), and I agree, that this was

erroneous for the following reasons:

The decision states, at pages 12-13, that

the conclusions were reached without

reliance on decisional law cited by the

Solicitor since such decisions are not

indexed by subject matter for the con-

venience of the public. To do otherwise,

the Judge stated would "give the Solici-

tor an unfair advantage * * * [based on]

data which only he has the means of

retrieving." Needless to say, the

Government is shocked by this approach

which, in effect, decrees that such pre-

cedents never, or no longer, exist. The

availability or nonavailability of pre-

cedents to the parties is no legal justi-

fication for a Judge refusing to acknow-

ledge their existence in deciding the

issues before him. By doing so, he

violates the concept of stare decisis. A

further reason for objecting to the

Judge's approach in this regard is the

fact that, contrary to the asertion of

respondent's attorney in his affidavit of

March 6, 1978, the administrative

decisions under the Act are regularly

published by three national reporter

services: Commerce Clearing House's

Labor Law Reporter/Wages-Hours, an

indexed loose leaf service; Bureau of

National Affairs" Wage and Hour Cases, a

series of indexed bound volumes; and

Prentice-Hall's Wage-Hour Guide, an

indexed looseleaf service containing

summaries of all decisional law under the

-16-

Act, and its Labor Relations Guide,

another indexed loose leaf service in

which summaries of the more significant

decisions are reported. Of course, each

of these services is readily available by

subscription or can be found in law

libraries or wherever other traditional

reporting services' publications are

found.

I have studied the evidence in the record

and the arguments of the parties with respect

to the issues, including the exceptions to

the Judge's decision. In view of all the

circumstances, the findings and conclusions

of the Administrative Law Judge, as set forth

in his decision dated April 10, 1978, are set

aside to the extent that they are inconsis-

tent with the conclusions reached herein.

The case is remanded to the Judge for the

limited purpose of computation of the amounts

due the respondent's employees on the basis

of the principles and methods found to be

proper herein. Such computation should also

be based upon the principles and findings

stated by the Judge in his decision to the

=}79«

extent that such principles and findings

are not inconsistent with the conclusions

which I have reached herein. Thereafter,

the Judge should issue a new or supplemental

decision restricted solely to findings as

to the amounts so found due.2/

The Government takes exception to the

Judge's finding that "unusual circumstances":

exist in this case, and his recommendation

that the respondent be relieved from the in-

eligible list sanction provided in Section

S(a) of the Act. At page 13 of his decision

the Judge stated the reasons for his con-

ciusion in this regard. In my opinion, the

circumstances which he described involve

"unusual circumstances" within the meaning

1/ The Government states that respondent "is indebt-

ed to his employees in the amount of $17,600.97, as

specified in Exhibits A and B to the complaint, less

allowable vacation credits under contract 67 for those

employees who took or were paid for vacations subse-

quent to June 30, 1977 (Decision, p. 12), and allow-

able credit for health and welfare contributions made

by respondent to the health insurance plan under con-

tract 67 (ibid.)" (Government's exception, pp. 7-8.)

-18-

of Section 5(a). See the decision of the

Assistant Secretary in Quality Maintenance

Co., Inc., supra. Therefore, I concur in

the Judge's finding and recommendation.

Dated at Washington, D.C.

this 13th day of February, 1979

s/Xavier M. Vela

Xavier M. Vela

Administrator

Wage and Hour Division

-}9-

APPENDIX D

MCNAMARA = O'HARA SERVICE CONTRACT

ACT, 41 USC §§ 351-358 (relevant

sections)

Relevant sections of the

McNamara - O'Hara Service

Contract Act, as amended,

41 USC §§ 351-358

§ 351. Required contract provisions:

minimum wages

(a) Every contract (and any bid speci-

fication therefor) entered into by the

United States or the District of Columbia

in excess of $2,500 except as provided

in section 356 of this title, whether

negotiated or advertised, the principal

purpose of which is to furnish services

in the United States through the use of

service employees shall contain the fol-

lowing:

(1) A provision specifying the minimum

monetary wages to be paid the various

classes of service employees in the per-

formance of the contract or any sub-

contract thereunder, as determined by

the Secretary, or his authorized repre-

sentative, in accordance with prevailing

rates for such employees in the locality,

or, where a collective-bargaining

agreement covers any such service em-

ployees, in accordance with the rates

for such employees provided for in such

agreement, including prospective wage

increases provided for in such agreement

as a result of arm's-length negotiations.

In no case shall such wages be lower

than the minimum specified in sub-

section (b) of this section.

(2) A provision specifying the

fringe benefits to be furnished the

various classes of service employees,

engaged in the performance of the

contract or any subcontract thereunder,

as determined by the Secretary or his

authorized representative to be pre-

vailing for such employees in the

locality, or, where a collective-

o2ea

bargaining agreement covers any such

service employees, to be provided for

in such agreement, including prospec-

tive fringe benefit increases provided

for in such agreement as a result of

arm's-length negotiations. Such

fringe benefits shall include medical

or hospital] care, pensions on retire-

ment or death, compensation for in-

juries or illness resulting from occu-

pational activity, or insurance to

provide any of the foregoing, unem-

ployment benefits, life insurance,

disability and sickness insurance,

accident insurance, vacation and holiday

pay, costs of apprenticeship or other

Similar programs and other bona fide

fringe benefits not otherwise required

by Federal, State, or local law to

be provided by the contractor or

subcontractor. The obligation under

=3<

this sub paragraph may be discharged

by furnishing any equivalent combina-

tions of fringe benefits or by making

equivalent or differential payments

in cash under rules and regulations

established by the Secretary.

(3) A provision that no part of

the services covered by this chapter

will be performed in buildings or

surroundings or under working condi-

tions, provided by or under the control

or supervision of the contractor

or any subcontractor, which are un-

sanitary or hazardous or dangerous

to the health or safety'of service

employees engaged to furnish the

services.

(4) A provision that on the date

a service employee commences work

on a contract to which this chapter

applies, the contractor or subcon-

=-4-

tractor will deliver to the employee

a notice of the compensation required

under paragraphs (1) and (2) of this

subsection, on a form prepared by the

Federal agency, or will post a notice

of the required compensation ina

prominent place atthe worksite.

(5) A statement of the rates that

would be paid by the Federal agency

to the various classes of service

employees if section 5341 or section

5332 of Title 5 were applicable to

them. The Secretary shall give due

consideration to such rates in makinec

the wage and fringe benefit determina-

tions specified in this section.

(b) (1) No contractor who enters into

any contract with the Federal Government

the principal purpose of which is to

furnish services through the use of

service employees and no subcontractor

-5-

thereunder shall pay any of his employees

engaged in performing work on such con-

tracts less than the minimum wage

specified under section 206(a)(1) of

Title 29.

(2) The provisions of sections

352-354 of this title shall be ap-

plicable to violations of this sub-

section.

§ 352. Violations-Liability of

responsible party: with-

holding payments due on con-

tract; payment of underpaid

employees from withheld

payments

(a) Any violation of any of the con-

tract stipulations required by section

351(a) (1) or (2) or of section 351(b)

of this title shall render the party

responsible therefore liable for 4 sum

equal to the amount of any deductions,

rebates, refunds, or underpayment of com-

pensation due to any employee engaged

in the performance of such contract. So

much of the accrued payment due on the

contract or any other contract between

the same contractor and the Federal

Government may be withheld as is necessary

to pay such employees. Such withheld

sums shall be held in a deposit fund.

On order of the Secretary, any compensa-

tion which the head of the Federal agency

or the Secretary has found to be due

Pursuant to this chapter shall be paid

directly to the underpaid employees form

any accrued payments withneld under this

chapter.

Enforcement of section

(b) In accordance with regulations

prescribed pursuant to section 353 of

this title, the Federal agency head or

the Secretary is hereby authorized to

oJeo

carry out the provisions of this section.

Cancellations of contract;

contracts for completion of

Original contract liability of

original contractor for additional costs

found of any contract stipulation, the

contract is subject upon written notice

to cancellation by the contracting agency.

Whereupon, the United States may enter

into other contracts or arrangements for

the completion of the origina] contract,

charging any additional cost to the

original contractor.

§ 353. Law governing Secretary's

authority; limitations and

regulations allowing varia-

tions, tolerances and exemptions;

predecessor contracts, appli-

cability; duration of contracts

(a) Sections 38 and 39 of this title

shall govern the Secretary's authority

to enforce this chapter, make rules,

regulations, issue orders, hold hearings,

and make decisions based upon findings

of fact, and take other appropriate

action hereunder.

(b) The Secretary may provide such

reasonable limitations and may make such

rules and regulations allowing reasonable

variations, tolerances, and exemptions to

and from any or all provisions of this

chapter (other than section 358 of this

title), but only in specia) circumstances

where he determines that such limitation,

variation, tolerance, or exemption is

necessary and proper in the public

interest or to avoid the serious im-

pairment of government business, and is

in accord with the remedial purpose of

this chapter to protect prevailing labor

standards.

under a contract, which succeeds a contract

subject to this chapter and under which

substantially the same services are furn-

Sihed, shall pay any service employee

under such contract less than the wages

and fringe benefits, including accrued

wages and fringe benefits, and any pros-

pective increases in wages and fringe bene-

fits provided for in a collective-bargain-

ing agreement as a result of arm's-length

negotiations, to which such service employee

would have been entitled if they were em-

ployed under the predecessor contract;

Provided, That in any of the foregoing

circumstances such obligations shall not

apply if the Secretary finds after a hear-

ing in accordance with the regulations

adopted by the Secretary that such wages

and fringe beneftis are substantially at

variance with those which prevail for

services of a character similar in the

-10-

locality.

(d) Subject to limitations in annual

appropriation Acts but notwithstanding

any other provision of law, contracts to

which this chapter applies may, if authori-

zed by the Secretary, be for any term of

years not exceeding five, if each such

contract provides for the periodic adjust-

ment of wages and fringe benefits pursuant

to future determinations, issued in the

manner prescribed in section 351 of this

title no less often than once every two

years during the term of the contract,

covering the various classes of service

employees.

§ 354 List of violators: prohibition

of contract award to firms ap-

pearing on list; actions to

recover underpayments; payment

of sums recovered

(a) The ComptrollerGeneral is directed

to distribute a list to all agencies of the

-lle-

government giving the names of persons or

firms that the Federal agencies or the Sec-

retary have found to have violated this

chapter. Unless the Secretary otherwise

recommends because of unusual circumstances,

no contract of the United States shall be

awarded to the persons or firms appearing

on this lest or to any firm, corporation,

partnership, or association in which per-

sons or firms have a substantial interest

until three years have elapsed from the

date of publication of the list containing

the name of such persons or firms. Where

the Secretary does not otherwise recommend

because of unusual circumstances, he shall,

not later than ninety days after a hearing

examiner has made a finding of a violation

of this chapter, forward to the Comptroller

General the name of the individual or firm

found to have violated the provisions of

this chapter.

(b) If the accrued payments withheld

o12@

under the terms of the contract are in-

sufficient to reimburse all service employ-

ees with respect to whom there has been a

failure to pay the compensation required

pursuant to this chapter, the United States

may bring action against the contractor,

subcontractor, or any sureties in any court

of competent jurisdiction to recover the

remaining amount of underpayments. Any

sums thus recovered by the United States

shall be held in the deposit fund and shall

be paid, on order of the Secretary, directly

to the underpaid employee or employees.

Any sur not paid to an employee because

of inability to do so within three years

shall be covered into the Treasury of the

United States as miscellaneous receipts,

* * *

§ 357 Definitions

For the purposes of this chapter -

(a) "Secretary" means Secretary of

Labor.

@i3e@

(b) The term "service employee" means

any person engaged in the performance of a

contract entered into by the United States

and not exempted under section 356 of this

title, whether negotiated or advertised,

the principal purpose of which is to fur-

nish services in the United States---.

any of the payments or fringe benefits

described in section 351 of this title.

(ad) The term "United States" when

used in a geographical sense shall include

any State of the United States---,

* * *

-14-

APPENDIX E

DEPARTMENT OF LABOR REGULATIONS,

29 CFR, Parts 4 and 6 (relevant sections)

Relevant sections of 29 CFR,

Part 4, Subpart C-

Application of the McNamara - O'Hara

Service Contract Act

§ 4.146 Contract obligations after

award, generally.

A contractor's obligation to observe

the provisions of the Act arises on the

date he is informed that he has received

the award of the contract, not necessarily

the date of formal execution. However,

he is required to comply with the provisions

of the Act and regulations thereunder only

while his employees are performing on the

contract, provided his records make clear

the period of such performance.

* * *

§ 4.150 Employee coverage generally.

The Act, in section 2(b), makes it

clear that its provisions apply generally

to all employees engaged in performing

work on a covered contract entered into by

the contractor with the Federal Govern-

ment, regardless of whether they are his

employees or those of any subcontractor

under such contract.---

§ 4.151 Employees covered by previ-

sions of section 2(a).

The provisions of section 2(a) of the

Act prescribe labor standards requirements

applicable, except as otherwise specifically

provided, to every contract in excess

of $2,500 which is entered into by the

United States or the District of Columbia

fof the principal purpose of furnishing

services in the United States through the

use of service employees. These provisions

apply to all service employees engaged in

the performance of such a contract or any

subcontract thereunder. The Act, in

section 8(b) defines the term "service

employee". The general scope of the

definition is considered in § 4.113(b) of

-2-

this subpart.

§ 4.152 Employees subject to pre-

vailing compensation provisions

of section 2(a)(1) and (2).

Under section 2(a)(1) and (2) of the

Act minimum monetary wages and fringe

benefits to be paid or furnished the

various classes of service employees per-

forming such contract work are determined

by the Secretary of Labor or his authorized

representative in accordance with pre-

vailing rates and fringe benefits for

such employees in the locality and are

required to be specified in such contracts

and subcontracts thereunder. All service

employees of the classes who actually

perform the specific services called for

by the contract (e.g. janitors performing

on a contract for office cleaning; steno-

graphic reporting) are covered by the pro-

visions specifying such minimum monetary

@3=

wages and fringe benefits for such classes

of service employees.

§ 4.165 Wage payments and fringe

benefits--in general,

(a)---

(2) The Act makes no distinction,

with respect to its compensation provi-

sions, between temporary, part-time, and

full-time employees, and the wage and

fringe benefit determinations apply, in

the absence of an express limitation,

equally to all such service employees

engaged in work subject to the Act's

provisions.

* * *

§ 4.170 Furnishing fringe benefits or

equivalents.

(a) General. Finge benefits specified

under the Act shall be furnished, in ad-

dition to the specified monetary wages,

by the contractor or subcontractor to

ofa

employees engaged in performance of the

contract, as provided in the determination

of the Secretary or his authorized repre-

sentative and prescribed in the contract

documents, or, in the event that this

is not possible or practicable, the obliga-

tion to furnish such benefits "may be

Gischarged by furnishing any equivalent

combinations of fringe benefits or by

making equivalent or differential payments

in cash under rules and regulations es-

tablished by the Secretary." (Act,

section 2(a) (2).)---

§ 4.171 Meeting requirements for par-

ticular fringe benefits.

(aoe

(b) ---

(2) Some questions have been raised

about the application of provisions

appearing in some fringe benefit determi-

nations which call for "l week paid

vacation after 1 year of service with

a contractor or successor." To deter-

mine when an employee meets the "after

1 year of service" test, an employer

must take two factors into consideration:

(1) the total length of time an employ-

ee has been in the employer's service,

including both the time he has been

performing on refular commercial work

and the time he has been performing

on the Government contract itself,

and (ii) the total length of time an

employee has been employed either by

the present contractor or predecessor

contractors in the performance of

Similar work on the same base. If

an employee has a year of service

under either the first or second

consideration, he is eligible for l

week's vacation with pay. For example,

if a contractor has an employee who

has worked for him for 2 years on regu-

lar commercial work and only for 6

months on a Government service contract,

that employee would be eligible for

the vacation since his total service

with the employer adds up to more than

l year. Similarly, if a contractor

has an employee who worked for 2 years

under a janitorial service contract

On a particular base for two different

predecessor contractors, and only

8 months with the present employer,

that employee would also be considered

as meeting the "after year of service"

test and would thus be eligible for

the specified vacation. Work performed

before, as well as after, a pertinent

wage determination is issued must be

counted in determining an employee's

length of service.

§ 4.173 Identification of contract work

Contractors and subcontractors under

contracts subject to the Act are required

to comply with its compensation require-

ments throughout the period of performance

on the contract and to do so with respect

to all employees who in any workweek are

engaged in performing work on such contracts.

If such a contractor during any workweek is

not exclusively engaged in performing such

contracts, or if while so engaged he has

employees who spend a portion but not all

of their worktime in the workweek in per-

forming work on such contracts, it is

necessary for him to identify accurately

in his records, or by other means, those

periods in each such workweek when he and

each such employee performed work on such

contracts. In cases where contractors

are not exclusively engaged in Government

contract work, and there are adequate

records segregating the periods in which

=-8-

work was performed on contracts subject

to the Act from periods in which other work

was performed, the compensation specified

under the Act need not be paid for hours

spent on non-contract work. However, in

the absence of records adequately segre-

gating non-covered work from the work per-

formed on or in connection with the contract,

all employees working in the establishment

or department where such covered work is

performed shall be presumed to have worked

on or in connection with the contract dur-

ing the period of its performance, unless

affirmative proof establishing the contrary

is presented. Similarly, in the absense of

such records, an employee performing any

work on or in connection with the contract

in a workweek shall be presumed to have

continued to perform such work throughout

the workweek, unless affirmative proof

establishing the contrary is presented.

Even where a contractor can segregate

-9-

Government fron non-Govenrment work, it is

necessary that he comply with the require-

ments of section 6(e) of the FLSA discussed

in §4.160.

* * *

Relevant section of 29 CFR, Part 6-

Rules of Practice for Administrative

Proceedings Enforcing Labor Standards

in Federal Service Contracts.

§ 6.14 Decisions and order of the

Administrator.

If exceptions to the decision of the

hearing examiner are taken as provided in

this part, the Administrator shall upon

consideration thereof, together with the

record references and authorities cited

in support thereof, make his decision,

which shall affirm modify, or set aside,

in whole or part, the findings, conclusions,

and order contained in the decision of the

hearing examiner, and shall include a

statement of reasons or bases for the

-10=

actions taken. With respect to the find-

ings of fact, the Administrator shall modi-

fy or set aside only those findings that

are clearly erroneous. Copies of the

decision and order shall be served upon

the parties. Any such decision shall

treat any question of recommendation for

relief from the ineligible list under

si ction 5(a) of the Act to the same extent

and subject to the same limitations as

provided in § 6.10(b) concerning decisions

fo the hearing examiner.

* * *

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.