Presentation on theme: "Federal Labor Standards & Maintenance Wage Rates June 21, 2012"— Presentation transcript:
1 Federal Labor Standards & Maintenance Wage Rates June 21, 2012 (HUD Programs)June 21, 2012Agency: HUD Region VII, Office of Labor Relations (OLR)Presenter: Fannie Woods, Director, OLRContact Information:
2 Office of Labor Relations (OLR) Administration and enforcement of:Federal labor standards onConstruction and construction-related projects funded/insured/assisted with HUD funds and/or through HUD ProgramsThreshold $2K or morePrevailing maintenance wage rates determined or adopted by HUDPHA Maintenance FunctionsAuthority: U. S. Housing Act of 1937, as amendedContains provision (12e) that gives HUD this authority
3 Federal Labor Statutes Reorganization Plan No. 14 of 1950Davis Bacon (DB) ActPrevailing wage requirement; pay weeklyContract Work Hours and Safety Standards Act (CWHSSA): overtime and penaltiesCopeland Act: Weekly certified payrolls; statement of compliance; anti-kickback; criminal prosecution29 CFR, Parts 1, 3, and 5There are other federal labor statutes, such as FLSA, Portal-to-portal, McNamara-O’Hara Service Contract Act, that may apply. These (as noted above) are the ones most used and referred to on federally-funded/assisted projects.
4 Davis Bacon ActApplies to construction and construction- related contracts in excess of $2KMade applicable to HUD programs by statutory provisions in HUD-related acts (DBRA)The National Housing ActU. S. Housing Act of 1937, as amendedThe Housing and Community Development Act of 1974, as amendedThe National Affordable Housing Act of 1990
5 Copeland Act (Anti-Kickback Act) Authority forSubmission of weekly certified payrolls and statements of complianceWillful falsification - civil or criminal prosecution; may be cause for debarmentRestriction on Payroll deductionsOnly those permissible without DOL approvalCriminal prosecutionRequiring persons/companies to give up any part of compensation entitled under his/her contractExceptions:Only where DBA and DBRA prevailing wage provisions apply.Do no apply where the nature of federal assistance is only in the nature of a loan guarantee.
6 Construction Contract Management System (Developing a system for compliance purposes - Federal Labor Standards Requirements)Compliance Officer – AppointIs the ED the right person for this position?Bid Documents include:Appropriate labor standard provisionsHUD 5370 Form > $100KHUD 5370 EZ Form < $100KApplicable federal wage rate decisionContract Agreements with prime contractors/subcontractors includes:
7 Construction Contract Management System (Developing a system for compliance purposes - Federal Labor Standards Requirements)Current wage decision – based on “lock in” or “effective date”This is the date bids are opened “provided” the contract is awarded within 90 days after bid openingIf contract awarded more than 90 days “after” bid openingWage decision must be updated as of the “date of the award”Lock in date becomes contract award dateModifications published/received prior to the lock in date apply to contractException:Competitive Bid procedures ONLYDisregard modifications published/received less than “10” days before a bid opening “IF” not a reasonable time to notify biddersDOCUMENT this action (permanent record in contract file)Eligibility DocumentationCheck eligibility of prime or potential contractors before contract award
8 Construction Contract Management System (Developing a system for compliance purposes - Federal Labor Standards Requirements)Project InspectionsDocument in master project fileDoes contract require a specific number?Worker Interviews – HUD-11No set numberTry to obtain a number from each trade on the job – target primary and subcontractors with significant monetary contractsCompare interview data to applicable certified payroll dataIf discrepancies between information, action to review/resolve/document
9 Job Site Posting Requirements Davis Bacon PosterObtain English and Spanish versionsPost “large” signs so all can seeInclude Authority’s compliance officer’s contact information in the contact block of these postersPost in a “highly” visible area, protected from the weather elements, that is easily accessible and traveled by most workers working at the job siteProject Wage DecisionApproved additional classificationsOther DOL required postersEEOFLSAGo to website –posters are available – may download and/or request the larger posters from DOL
10 After contract award, review wage decision with prime or subcontractor Construction Contract Management System (Developing a system for compliance purposes - Federal Labor Standards Requirements)After contract award, review wage decision with prime or subcontractorSubmit HUD-4230A Form for any required trades not listed on wage decisionEstablish a Master Project File, which includesSigned Contract AgreementProject Wage DecisionConstruction Start NoticeLst of subcontractors-trade-points of contact - $$$ amountCheck eligibility at
11 Develop separate Subcontractors’ files, which include Construction Contract Management System (Developing a system for compliance purposes - Federal Labor Standards Requirements)Develop separate Subcontractors’ files, which includeCertified payrolls with signed statement of compliance reflecting original signaturesWH 347, U. S. Department of Labor Payroll FormStatement of Compliance (back side of the WH 347)Optional forms – must mirror data and wording on the WH 347 and statement of complianceNo deviation in language, as reflected on the DOL statement of compliance
12 WH 347 and Statement of Compliance Go to below link for instructions/download form
15 Compliance Review/Documentation Weekly Certified Payrolls – Workers paid weekly!From all contractors performing work on the job – different rules for:OLR Letter 96-01, – program offices – labor relations - resourcesSelf-employer owners/sole Proprietors with no crewsSelf-employer owners/sole Proprietors with crewsReflect all workers on the project and required data
16 Compliance Review/Documentation Workers Classification – FlagsNo skilled trades—all laborers on a carpentry contractClassification/Trade not on project wage decisionHelper Classification - Not authorized!ApprenticeShow journeyman trade; and apprentice levelVerify validity of this classification, via a copy of:Individual Registration for each worker classified as an apprenticeProgram Standards - specific pages/informationIf silent on fringe benefits – what is the rule?Hours worked on project (daily and weekly; standard; overtime)Rates of pay (standard and overtime) – FlagsSame for all workers; no workers working 40 hours a weekPrevailing wage is: hourly basic wage + fringes = total prevailing wageGross Pay – FlagsRounded numbers
17 Compliance Review/Documentation Deductions – focus on “other”Only if deductions benefit the worker and “not” the employerOnly if written consent and in advance of work to be performedNot a condition for and/or continuation of employmentMay be required by a collective bargaining agreement (CBA)May be court ordered, i.e. child support, garnishment,Net PayGross pay minus deductionsMatches amount actually paid to the worker
18 Compliance Review/Documentation Statements of complianceAttached to each weekly payrollCompleted fully/accuratelyReflects only original signatureOwner, Principal, OfficerIf not, written authorization from one of these persons authorizing, by name, the person to sign this document
19 Deficiency Letters Notification of non compliance to contractors No standard formatCaptures problems noted:During payroll reviewsComparison of HUD-11 Interview to Payroll DataStates action to resolve the deficiencyProvides time line (usually 30 days) for resolutionServes as the basis to withhold funds if deficiencies are not resolvedAVOID closing contracts where there are violations of federal labor standards
20 Underpayments/Restitution When discovered? Usually-During payroll reviewsMisclassification of workersApprentice – Out-of-ratio issuesIncorrect rates of payErroneous overtime calculationsMath errorsDeductions that are not allowedComplaints from workersDocument, review, investigate, decision, report results
21 Revised Certified Payrolls Resubmitted payrolls are labeled “revised” and carry dates of the initial payrollsDo not write on payrollsDo not return any payrollsUnderpayments/RefundsSubmission of a certified payroll labeled “revised- restitution”New statement of complianceMay request supporting documentation to verify that payment was made and worker received it.
22 Worker Complaint Develop intake process Investigate allegations Determine validity of allegationsResolve complaint –Document actions taken/resolution
23 State Agencies (additional requirements) Monitor grantees to assess grantee performance of labor standards responsibilities (may apply to city/county agencies)Ensure corrective action for non complianceCollect and submit to HUDAll enforcement reports required in 29 CFR 29, Part 5, Section 5.7Submit directly to DOL – additional classification requirements
24 No contractor is paid without complying with federal labor standards provisions Administrative Compliance Provisions - DocumentationEPLS checkWeekly pay to workersSubmission of weekly certified payrolls with statements of compliance (original signatures; revised payrollsSpot-check – review of payrollsDeficiency lettersRestitution (underpayments or from review of the HUD 11 not matching submitted payrolls.)
25 Report Contractors (non compliance) to HUD Report to HUDWorkers complaint, if you are unable to resolveAny potential criminal or complex enforcement matters, regarding contractors (non compliance)Report Contractors (non compliance) to HUDRef: 29 CFR part 5, Section 5.7Collective underpayments of $1,000 or more from one employer
27 Semi-Annual Labor Enforcement Report via HUD 4710 Form Statutory Requirement – Maintain filesPHAs, excluding Section 8 Only, reportReport reflects:All contracts, subject to federal labor standards, awarded during the reporting periodIf no contracts awarded during the period, “report 0”ComplaintsRestitution paidCWHSSAOvertime and Liquidated damages ($10 per violation)
28 Semi-Annual Labor Enforcement Report via HUD 4710 Form Two Reporting PeriodsPeriod One: Oct 1 thru Mar 31Period Two: Apr 1 thru Sep 30Due dates to OLRUsually region will determine date to submit to themIn Region VII – Apr 5 and Oct 5
30 Maintenance Wage Determination via HUD 4750 Form /HUD 52158 Form What is the Annual Maintenance Wage Determination Process?ANS: Establishment of prevailing wage rates for maintenance employees at low-income housing projects operated by Public Housing AuthoritiesWhat mandates this requirement?ANS: USHA of 1937, as amended
31 Maintenance Wage Determination via HUD 4750 Form /HUD 52158 Form Which Authorities are required to participate?ANS: Any Authority that operates low-income housing projects and employ and/or contract for any maintenance functions.What are the effective dates of the “annual” MWD approval?ANS: Fiscal Year of the Authority
32 What form is used for the approval? Maintenance Wage Determination What is the form for the approved MWD? via HUD 4750 Form /HUD FormWhat form is used for the approval?ANS: HUD 52158When is an “additional classification” required for maintenance employees and/or maintenance contractors?ANS: For any work classification “not” listed on the approvedWhat if the Authority contracts out all of its maintenance functions, is the Authority still required to participate in this process?ANS: YES
33 Maintenance Wage Determination Process via HUD 4750 Form /HUD 52158 Form What if the Authority fails to participate?What happens if HUD OLR does not approve the annual maintenance wage rates prior to start of the Authority fiscal year?ANS: OLR will take the hitWhat is the recordkeeping requirement for work/employees covered via this process?Maintenance for no less than 3 years following the completion of the work
34 Maintenance Wage Determination Process via HUD 4750 Form /HUD 52158 Form What is included with the records?Employer name, address, and ssnCorrect work classificationsHourly rate(s) of monetary wages paidRates(s) of any bona fide fringes benefits providedNumber of the daily and weekly hours workedGross wages earnedAll deductions takenActual net wages paid
35 Maintenance Wage Determination Process via HUD 4750 Form /HUD 52158 Form What happens if the Authority fails to pay the maintenance worker at least the amount of the total wages approved on the HUD Form?Why does HUD OLR require a copy of the Authority’s personnel policy?Why does HUD OLR require a copy of the job descriptions for the work classifications listed on the HUD 4750 form?Why is HUD OLR requiring a narrative and information on the methodology used to determine the recommended wages on the HUD 4750 form?
36 Where does an Authority get comparable wage data? Maintenance Wage Determination Process via HUD 4750 Form /HUD FormWhere does an Authority get comparable wage data?Collective Bargaining Agreements (wage rates apply—regardless)Request from local area private agencies that employ workers in similar positionsCity Human Resources – if the Authority is connected with the City and comply with the City’s personnel/human resources policyWhat is the timeframe for submitting this information to HUD OLR?ANS: Authority submits at least 90 days before fiscal year start date and HUD OLR approval 60 days before fiscal year start date
37 Maintenance Wage Determination Process via HUD 4750 Form /HUD Form 52158 What happens if HUD OLR changes the worker’s classification?Is the annual MWD for routine maintenance work?What if the Authority has a non routine maintenance job, where does the Authority get the base wage for its solicitation package?How is “non routine” maintenance defined?What if the Authority is unsure if it is a “non routine” project or a project subject to federal labor standards requirements?Call OLR to discussRule of thumb: if construction is related in any way used DB wage decisions – can not go wrong
38 Maintenance Wage Determination Process via HUD 4750 Form/HUD Form 52158 What is the meaning of the term “force account”?Can an Authority use this category for workers?Are force account workers subject to federal labor standards requirements?What hourly wage rate/fringes are used to calculate pay for these workers?Can an Authority used a public housing resident as a “volunteer” in a maintenance function?Ref: 24 CFR Part 70, and paragraphs 2-8 Volunteers, and 11-31, Volunteers
39 Recent updates Making Davis Bacon Work, January 2012 n/hudclips/guidebooks/4812LRHUD Handbook , Rev 2Links viaProgram OfficesLabor RelationsResources
41 DAVIS-BACON RELATED WEB SITES Department of Labor DBRA Homepage tmDepartment of Labor RegulationsDepartment of Labor Forms
42 Office of Labor Relations References Labor Relations LettersOn-the-Mark! SeriesAvailable on-line in Labor Relations Library at:
43 DISCLAIMERThis presentation is intended as general information only and does not carry the force of legal opinion.The Department of Housing and Urban Development (HUD) is providing this information as a public service. This information and related materials are presented to give the public access to information on HUD programs. You should be aware that, while we try to keep the information timely and accurate, there will often be delay between official publications of the materials and the modification of these pages. Therefore, we make no express or implied guarantees. The Federal Register and the Code of Federal Regulations remain the official source for regulatory information published by the Department of Housing and Urban Development. We will make every effort to keep this information current and to correct errors brought to our attention.