1 Marshall Space Flight Center Government Acquisitions and the Contractor Industrial Labor Relations Program Talmage R. Reynolds November 19, 2009

2 Contractor Industrial Labor Relations Program Responsibilities of the Functional Program Manager –Administer Centers Contractor Industrial Labor Relations Program –Represent the Center Director in day-to-day contacts with organized labor and contractor management personnel –To ensure consistent application, administration, and enforcement of the Federal Labor Standards Serve as a staff representative and technical advisor to: –Center Director –Program Mangers –Contracting Officers –Contracting Officers Technical Representatives –Facilities Staff and Inspection Personnel –Source Evaluations Boards and Committees

3 Contractor Industrial Labor Relations Program Involves two very distinct program functions… – Industrial Labor Relations… – Federal Labor Standards …

4 Contractor Industrial Labor Relations Program What is Industrial Labor Relations? – Its the Relationship Business and it... Involves the right of every American to be represented by a Union (Collective Bargaining Representative) as defined by the National Labor Relations Act

5 Contractor Industrial Labor Relations Program What is Collective Bargaining… A Doctrine of Fairness Burney E. DeLury Former Director Federal Mediations & Conciliation Service

6 Contractor Industrial Labor Relations Program Industrial Labor Relations (FAR ) Industrial Labor Relations as defined by the National Labor Relations Act To maintain sound relations with industry and organized labor to ensure: – Prompt receipt of information involving labor relations that may adversely affect NASA Acquisitions – That NASA obtains critical supplies and support services without delay – That the parties in dispute use all available methods for resolving the dispute – That prompt and immediate action be taken to: Encourage continued proactive interest-based bargaining Notify and involve agencies (Federal Mediation and Conciliation Service, National Labor Relations Board, and other Federal, state, local, and private agencies) responsible for conciliation, mediation, and arbitration Furnish the parties in dispute factual information regarding potential adverse impact to the many critical NASA-MSFC Programs Seek voluntary agreement between contractor management and organized labor to permit uninterrupted flow of supplies and services at MSFC & MAF

7 Contractor Industrial Labor Relations Program What should Center Employees do? – Not allow contractor management nor organized labor to entice you to state an opinion or offer advise about union activity – Refrain from making comments either pro or con involving unions – Remain impartial and neutral at all times – Not to infer nor imply a NASA position on any labor relations issues Refer all issues and inquires to: Contractor Industrial labor Relations Office Office of Center Operations / AS01 Patrick W. Rasco / Talmage R. Reynolds /

8 Contractor Industrial Labor Relations Program Organized Labor at Marshall Space Flight Center (MSFC) – 17 Labor Unions representing contractor's employees 14 Collective Bargaining Agreements Organized Labor at Michoud Assembly Facility (MAF) – 3 Labor Unions representing contractors employees 3 Collective Bargaining Agreements

9 Contractor Industrial Labor Relations Program Mission Success… Marshall Management Contractor Management Organized Labor Government Contract Contractor Industrial Labor Relations Program

10 Contractor Industrial Labor Relations Program Whats been done in this area? – Established an Area Labor-Management Relations Council (ALMRC) Bimonthly Council Meetings since 1990 – Implemented a Center-wide Policy Contractor Union Activity at MSFC (re-issued July 3, 2007)

11 Contractor Industrial Labor Relations Program The Federal Labor Standards (FAR 22.2 – 22.10) Statutes: – Davis-Bacon Act-- (40 U.S.C a-7) – Copeland (Anti-kickback) Act-- (40 U.S.C. 276c) – Walsh-Healey Act-- (41 U.S.C. 38, as amended) – Contract Work Hours & Safety Standards Act-- (40 U.S.C ) – Service Contract Act-- (41 U.S.C. 351, as amended) – Fair Labor Standards Act-- (U.S.C. 201, et seq.) Implementing Regulations: – Title 29 Code of Federal Regulations: Part 3 = Copeland Act Part 4 = Service Contract Act Part 5 = Davis-Bacon Act & Contract Work Hours & Safety Standards Act Part 6 = Rules & Practices for Labor Standards Enforcement Proceedings Part 7 = Rules & Practices for the Administrative Review Board – Construction Part 8 = Rules & Practices for the Administrative Review Board – Services Part 541 = Executive, Administrative, and Professional Exemptions Part 778 = Overtime Part 785 = Hours Worked

12 Contractor Industrial Labor Relations Program Davis-Bacon Act – Purpose and Intent of the Act... To protect communities and workers from the economic disruption caused by competition arising from non-local contractors coming into an area and obtaining Federal construction contracts by underbidding local wages

13 Contractor Industrial Labor Relations Program Davis-Bacon Act – Federal Statute Public Law 403 of March 3, 1931 (As amended in 1935 and 1964) – Implementing Regulation Title 29 CFR Parts 3 and 5 – Contract Clause FAR plus all other related clauses – Coverage… Construction, Alternations, Repair, Painting, or Decorating of: –Public Buildings or Public Works –At the site of work (site specific) – Affords Protection to: Laborers and Mechanics –Defined as workers whose duties are manual or physical in nature who uses tools or who are performing the work of a trade

14 Contractor Industrial Labor Relations Program Davis-Bacon Act – E xempts those employees who qualify as bona fide Executive, Administrative, or Professional employees as defined in Title 29 CFR Part 541 – Minimum Mandatory Requirements A very precise and exacting Federal labor standard Weekly payment of wages & fringes– 29 CFR 5.5(a)(1)(i) Payroll and Basic Records – 29 CFR 5.5(a)(3)(i) Submittal of Certified Payroll Records – 29 CFR 5.5(a)(3)(ii) Posting Requirements at site of work – 29 CFR 5.5(a)(1)(i) Prime is liable for compliance of Subs – 29 CFR 5.5(a)(6) Working Foremen – 29 CFR 5.2(m) Apprentices & Trainees authorized – 29 CFR 5.2(n)(1) and 5.5(a)(4)(i): –Must be an approved USDOL Certified Program –Must not exceed journeyman to apprentice ratio Helpers are not authorized unless USDOL criteria is met

15 Contractor Industrial Labor Relations Program Whats been done in this area? – Implementation of a Preventative Labor Standards Enforcement Program Contractor / Procurement / Facility Personnel Training Preconstruction Activities –Preconstruction Conference –Davis-Bacon Act Letter and Preconstruction Conference Checklist – Implemented an Advisory Letter Labor Morsel –Published to keep Procurement and Program Staffs current on issues affecting our contracts and resources

16 Contractor Industrial Labor Relations Program Whos Responsible for Davis-Bacon Act Enforcement? – The Contracting Agency (Reorganization Plan No. 14 of 1950) Day-to-day oversight for compliance Facilities Inspection Personnel Certified Payroll Compliance Reviews Pamela S. Davis – AS22 Cari H. Willingham – AS23 Labor Standards Investigations Contractor Industrial Labor Relation Officer Enforcement Contracting Officer in coordination with the Contractor Industrial Labor Relations Officer and Chief Counsels Office

17 Contractor Industrial Labor Relations Program Copeland (Anti-Kickback) Act –Purpose and Intent of the Act Prohibits Kickback of wages and back wages Requires contractors on DBA and DBRA covered projects to submit weekly payroll containing a certified statement of compliance Regulates payroll deductions –Federal Statute 40 U.S.C. 276c –Implementing Regulation Title 29 CFR Part 3 –FAR Clauses FAR and

18 Contractor Industrial Labor Relations Program Whos Responsible for Copeland (Anti-Kickback) Act Enforcement? – The Contracting Agency (Reorganization Plan No. 14 of 1950) Day-to-day oversight of compliance Facilities Inspection Personnel Labor Standards Investigations Contractor Industrial Labor Relation Officer Enforcement Contracting Officer in coordination with the Contractor Industrial Labor Relations Officer and Chief Counsels Office

19 Contractor Industrial Labor Relations Program Walsh-Healey Public Contracts Act –Provides Labor Standards for employees working on Federal contracts for the manufacturing or furnishing of goods, supplies, articles, or equipment –Federal Statute 41 U.S.C. 38, as amended –Implementing Regulation CFR Title 41, Chapter 50 –FAR Clause

20 Contractor Industrial Labor Relations Program Walsh-Healey Public Contracts Act –Establishes Minimum Wage (equal to or greater than FLSA minimum wage rate) Overtime Requirement Safety and Health Standards Prohibits employment of –Convict labor –Male person under 16 years of age –Female person under 18 years of age Posting Requirements –Whos Responsible for Enforcement U.S. Department of Labor

21 Contractor Industrial Labor Relations Program Contract Work Hours and Safety Standards Act – 1962 – Consolidating a number of eight hour laws that provided for overtime pay on Federally financed contracts employing laborers and mechanics – Federal Statute 40 U.S.C. 327 – 332 – FAR Clause – In 1986, the Federal daily overtime requirement was repealed to require overtime pay only after 40 hours work per week – Both the Contract Work Hours and Safety Standards Act (CWHSSA) and Fair Labor Standards Act (FLSA) require overtime pay for hours worked in excess of 40 hours in a work week – No site of work limitation (as with the Davis-Bacon Act)

22 Contractor Industrial Labor Relations Program Contract Work Hours and Safety Standards Act – Coverage… Covers contracts over $100,000 Covers DBA, DBRA, and SCA contracts involving the employment of laborers, mechanics, watchmen, guards, firefighters, and fireguards – Mandates Overtime pay of one and one-half times the basic hourly rate of pay for hours worked in excess of 40 in a workweek The collection of liquidated damages in the amount of $10 per day, per person, per violation when contractor fails to pay the required overtime rate (one and one-half time the basic rate of pay)

23 Contractor Industrial Labor Relations Program Whose Responsible for CWHSSA Enforcement? – Contracting Agency (Reorganization Plan No. 14 of 1950) Day-to-day Oversight Facilities Inspection Personnel; and Certified Payroll Compliance Reviews (on DBA contracts) – Contractor Industrial Labor Relations Officer Conducts CWHSSA investigations Determines amount of back wages due employee and liquidated damages to be assessed –Enforcement Contracting Officer in coordination with the Contractor Industrial Labor Relations Officer and Chief Counsels Office

24 Contractor Industrial Labor Relations Program Service Contract Act of 1965 – Purpose and Intent of the Act… To remove wages as a factor in the competition for Federal service contracts by requiring the payment of not less than locally prevailing wage rates and fringe benefits, or in certain cases, the wages and fringe benefits in the predecessor contractors collective bargaining agreement(s)

25 Contractor Industrial Labor Relations Program Service Contract Act of 1965 – Federal Statute 41 United States Code 351 (as amended in 1972 and 1976) – Implementing Regulation Title 29 Code of Federal Regulations Part 4 – Contract Clause FAR – Affords Protection to Service Employees Service employees are defined as any person engaged in the performance of a covered Federal Service Contract – However, it exempts those employees who qualify as bona fide Executive, Administrative, or Professional employees as defined in Title 29 CFR Part 541

26 Contractor Industrial Labor Relations Program Service Contract Act coverage – Contracts for support services entered into by any agency or instrumentality of the Federal Government including non- appropriated funds activities – Covers contract over $2,500 – Elements necessary for coverage: Contracts must be principally for services Coverage is not dependent upon interstate commerce Contract must be performed within the United States Contract must be performed through the use of service employees

27 Contractor Industrial Labor Relations Program Contracts not covered by the Service Contract Act – Construction – Supply – Manufacturing – Leasing of Space – Freight Carriage – Utilities – Certain items for commercial services (29 CFR 4.123(e)(1)(i) and (2)(i)-(iv)) Requires contractor certification [FAR (b)(4)(ii)(D)] – ADPE Maintenance and Repair Contracts Requires contractor certification [FAR (b)(4)(ii)(D)]

28 Contractor Industrial Labor Relations Program Service Contract Act – Coverage… Mission Support Services Contracts – Minimum Mandatory Requirements Timely payment of wages – 29 CFR 4.165(b) Posting Requirements – 29 CFR Minimum Record Keeping – 29 CFR Minimum wages based on job classification – 29 CFR –If no matching classification one must be conformed – 29 CFR 4.6(b)(2) Minimum Health and Welfare Rate – 29 CFR Minimum Number of Vacation Days – 29 CFR –Accrual rate is based on length of service which includes the whole span of continuous service with all predecessor, present, and successor contractors. Vacation days are due on the employees anniversary date Minimum number of Paid Holidays – 29 CFR SCA makes no distinction between a full-time permanent, part-time permanent, temporary, or part-time employee – 29 CFR 4.176

29 Contractor Industrial Labor Relations Program Service Contract Act –Items that cannot be counted as Health and Welfare (Fringe Benefits) for SCA Health and Welfare computation purposes: Federal, State, and Local Taxes, Unemployment or Workers Compensation, Professional Insurance, Liability Insurance, etc. – 29 CFR 4.171(c) Furnishing of Board and Lodging – 29 CFR 4.171(d) Furnishing of facilities or transportation – 29 CFR 4.171(e) Contribution to social functions – 29 CFR 4.171(f) Vacation Pay – 29 CFR Holiday Pay – 29 CFR 4.174

30 Contractor Industrial Labor Relations Program Whats been done in this area? – Implementation of a Preventative Labor Standards Enforcement Program Contractor / Procurement / Personnel Training Service Contract Act Letter and Checklist – Implemented an Advisor Letter Labor Morsel –Published to keep Procurement and Program Staffs current on issues affecting our contracts and resources

31 Contractor Industrial Labor Relations Program Whos Responsible for Service Contract Act Enforcement? – U.S. Department of Labor Wage and Hour Division – However, the Contracting Agency has an obligation to Ensure day-to-day compliance

32 Contractor Industrial Labor Relations Program Violations of the Federal Labor Statutes and Regulations Is nothing less than contract… Fraud, Waste, and Abuse

33 Contractor Industrial Labor Relations Program NASA FAR Supplement Part 1822 Changes… –Wage Determinations Davis-Bacon Act Procedures NFAR –Contracting Officers shall follow the detailed FAR procedures for obtaining DBA Wage Determinations at –Contracting Officers must become familiar with USDOL All Agency Memorandums (AAM) Numbers 130 and 131 –Caution there are four types of DBA Wage Determinations: »Building Construction (Sheltered enclosures for people & equipment) »Heavy Construction (Catch-all …bridges, dams, levees, towers, canals) »Highway Construction (Highways, streets, runways, etc.) »Residential Construction (Apartments < 4 stories, single family housing) –Note: DBA Wage Determinations cannot be mixed on a single project except in rare circumstances [i.e., the work must be substantial in relationship to total project cost (20 percent or more of the total contract value); it must be distinct; and it must be clearly segregable from the principal purpose of the contract (See AAM # 131 for more details)]

34 Contractor Industrial Labor Relations Program NASA FAR Supplement Part 1822 Changes… –Wage Determinations Davis-Bacon Act Procedures NFAR (continued) –After obtaining the required Wage Determination the Contracting Officer shall submit request for review to the Centers Resident Contractor Industrial Labor Relations Officer at least 10 days before issuing a solicitation or exercising a contract option –For multiyear construction contracts wage determinations shall be updated in accordance with U.S. Department of Labor, All Agency Memorandum (AAM) No. 157, dated December 9, 1992, and NFAR (b) »Caution on multiple year IDIQ and Credit Cards Contracts – dont award contracts which could leave the perception NASA is trying to circumvent the spirit and intent of the USDOL AAM and the regulations

35 Contractor Industrial Labor Relations Program FAR Requirement to Obtain SCA Wage Determinations –Contracting Officers shall obtain wage determinations for the following service contracts: a)Each new solicitation and contract in excess of $2,500 b)Each contract modification that brings the contract above $2,500 a)Extends the existing contract pursuant to an option clause or otherwise; or b)Changes the scope of the contract whereby labor requirements are affected significantly c)Each multiple year contract in excess of $2,500 upon -- a)Annual anniversary date if the contract is subject to annual appropriations; or b)Biennial anniversary date IF the contract is not subject to annual appropriations and its proposed term exceeds 2 years – unless otherwise advised by the Wage and Hour Division.

36 Contractor Industrial Labor Relations Program NASA FAR Supplement Part 1822 Changes… –Wage Determinations Service Contract Act procedures NFAR –Contracting Officers shall follow the detailed FAR procedures for obtaining SCA Wage Determinations at : »An electronic Form e98 must be submitted to obtain Wage Determinations prior to release of all solicitations as well as the exercise of contract options, contract anniversary dates, or contract extensions in accordance with the FAR procedures –There are three types of Wage Determinations (select with caution) : »AREA WAGE DETERMINATIONS (two types; even & odd #s) »NATIONWIDE WAGE DETERMINATIONS (specialty WDs) »4(c) WAGE DETERMINATIONS (Based on an incumbent contractors Collective Bargaining Agreement(s))

37 Contractor Industrial Labor Relations Program NASA FAR Supplement Part 1822 Changes… –Wage Determinations Service Contract Act procedures NFAR (continued) AREA WAGE DETERMINATIONS (AAM # 188 – May 1997) –Even Number (i.e., ) »Mandates the payment of the Health and Welfare rate based on an average of all hours worked by SCA employees –Odd Number (i.e., ) »Mandates the payment of the Health and Welfare rate based on all hours paid each service employee to a maximum of 2080 hours annually Even number and odd number… When to use which? –Even Number – only applies to older contracts that already contain an even number wage determination (these contracts are grandfathered) –Odd Number – applies to all new contract requirements and all future requirements (re-competition solicitations, annual anniversary dates, contract options, and extensions)

38 Contractor Industrial Labor Relations Program NASA FAR Supplement Part 1822 Changes… –Wage Determinations Service Contract Act procedures NFAR (continued) NATIONWIDE WAGE DETERMINATIONS –Aircraft Operations and Maintenance WDs –Environmental Cleanup WDs –Elevator Services WDs –Auto Concession Services WDs –Aerial Photographer/Seeding/Spraying Services WDs –Etc., Etc. 4(c) WAGE DETERMINATIONS –Based on collective bargaining agreement(s) between an incumbent contractors and the service employees union representative

39 Contractor Industrial Labor Relations Program NASA FAR Supplement Part 1822 Changes… –Wage Determinations Service Contract Act procedures NFAR (continued) –After obtaining the Wage Determination Contracting Officers shall submit request for review to their Centers Resident Contactor Industrial Labor Relations Officer at least 10 days before issuing solicitations, modifications, options, or extensions Instructions and assistance for completing the electronic (e98) can be obtained from the Centers Resident Contractor Industrial Labor Relations Officer

40 Contractor Industrial Labor Relations Program Who is the Centers Contractor Industrial Labor Relations Officer? Patrick W. Rasco Mail Code: AS01 Building 4200 / G Talmage R. Reynolds Mail Code: AS01 Building 4200 /

41 Contractor Industrial Labor Relations Program The End…