1. Federal Labor Standards & Maintenance Wage Rates June 21, 2012
(HUD Programs)
June 21, 2012
Agency: HUD Region VII, Office of Labor Relations (OLR)
Presenter: Fannie Woods, Director, OLR
Contact Information:

2. Office of Labor Relations (OLR)
Administration and enforcement of:
Federal labor standards on
Construction and construction-related projects funded/insured/assisted with HUD funds and/or through HUD Programs
Threshold $2K or more
Prevailing maintenance wage rates determined or adopted by HUD
PHA Maintenance Functions
Authority: U. S. Housing Act of 1937, as amended
Contains provision (12e) that gives HUD this authority

3. Federal Labor Statutes
Reorganization Plan No. 14 of 1950
Davis Bacon (DB) Act
Prevailing wage requirement; pay weekly
Contract Work Hours and Safety Standards Act (CWHSSA): overtime and penalties
Copeland Act: Weekly certified payrolls; statement of compliance; anti-kickback; criminal prosecution
29 CFR, Parts 1, 3, and 5
There 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 Act
Applies to construction and construction- related contracts in excess of $2K
Made applicable to HUD programs by statutory provisions in HUD-related acts (DBRA)
The National Housing Act
U. S. Housing Act of 1937, as amended
The Housing and Community Development Act of 1974, as amended
The National Affordable Housing Act of 1990

5. Copeland Act (Anti-Kickback Act)
Authority for
Submission of weekly certified payrolls and statements of compliance
Willful falsification - civil or criminal prosecution; may be cause for debarment
Restriction on Payroll deductions
Only those permissible without DOL approval
Criminal prosecution
Requiring persons/companies to give up any part of compensation entitled under his/her contract
Exceptions:
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 – Appoint
Is the ED the right person for this position?
Bid Documents include:
Appropriate labor standard provisions
HUD 5370 Form > $100K
HUD 5370 EZ Form < $100K
Applicable federal wage rate decision
Contract 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 opening
If contract awarded more than 90 days “after” bid opening
Wage decision must be updated as of the “date of the award”
Lock in date becomes contract award date
Modifications published/received prior to the lock in date apply to contract
Exception:
Competitive Bid procedures ONLY
Disregard modifications published/received less than “10” days before a bid opening “IF” not a reasonable time to notify bidders
DOCUMENT this action (permanent record in contract file)
Eligibility Documentation
Check 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 Inspections
Document in master project file
Does contract require a specific number?
Worker Interviews – HUD-11
No set number
Try to obtain a number from each trade on the job – target primary and subcontractors with significant monetary contracts
Compare interview data to applicable certified payroll data
If discrepancies between information, action to review/resolve/document

9. Job Site Posting Requirements
Davis Bacon Poster
Obtain English and Spanish versions
Post “large” signs so all can see
Include Authority’s compliance officer’s contact information in the contact block of these posters
Post in a “highly” visible area, protected from the weather elements, that is easily accessible and traveled by most workers working at the job site
Project Wage Decision
Approved additional classifications
Other DOL required posters
EEO
FLSA
Go 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 subcontractor
Submit HUD-4230A Form for any required trades not listed on wage decision
Establish a Master Project File, which includes
Signed Contract Agreement
Project Wage Decision
Construction Start Notice
Lst of subcontractors-trade-points of contact - $$$ amount
Check 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 include
Certified payrolls with signed statement of compliance reflecting original signatures
WH 347, U. S. Department of Labor Payroll Form
Statement of Compliance (back side of the WH 347)
Optional forms – must mirror data and wording on the WH 347 and statement of compliance
No 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 - resources
Self-employer owners/sole Proprietors with no crews
Self-employer owners/sole Proprietors with crews
Reflect all workers on the project and required data

16. Compliance Review/Documentation
Workers Classification – Flags
No skilled trades—all laborers on a carpentry contract
Classification/Trade not on project wage decision
Helper Classification - Not authorized!
Apprentice
Show journeyman trade; and apprentice level
Verify validity of this classification, via a copy of:
Individual Registration for each worker classified as an apprentice
Program Standards - specific pages/information
If silent on fringe benefits – what is the rule?
Hours worked on project (daily and weekly; standard; overtime)
Rates of pay (standard and overtime) – Flags
Same for all workers; no workers working 40 hours a week
Prevailing wage is: hourly basic wage + fringes = total prevailing wage
Gross Pay – Flags
Rounded numbers

17. Compliance Review/Documentation
Deductions – focus on “other”
Only if deductions benefit the worker and “not” the employer
Only if written consent and in advance of work to be performed
Not a condition for and/or continuation of employment
May be required by a collective bargaining agreement (CBA)
May be court ordered, i.e. child support, garnishment,
Net Pay
Gross pay minus deductions
Matches amount actually paid to the worker

18. Compliance Review/Documentation
Statements of compliance
Attached to each weekly payroll
Completed fully/accurately
Reflects only original signature
Owner, Principal, Officer
If 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 format
Captures problems noted:
During payroll reviews
Comparison of HUD-11 Interview to Payroll Data
States action to resolve the deficiency
Provides time line (usually 30 days) for resolution
Serves as the basis to withhold funds if deficiencies are not resolved
AVOID closing contracts where there are violations of federal labor standards

20. Underpayments/Restitution
When discovered? Usually-
During payroll reviews
Misclassification of workers
Apprentice – Out-of-ratio issues
Incorrect rates of pay
Erroneous overtime calculations
Math errors
Deductions that are not allowed
Complaints from workers
Document, review, investigate, decision, report results

21. Revised Certified Payrolls
Resubmitted payrolls are labeled “revised” and carry dates of the initial payrolls
Do not write on payrolls
Do not return any payrolls
Underpayments/Refunds
Submission of a certified payroll labeled “revised- restitution”
New statement of compliance
May request supporting documentation to verify that payment was made and worker received it.

22. Worker Complaint Develop intake process Investigate allegations
Determine validity of allegations
Resolve 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 compliance
Collect and submit to HUD
All enforcement reports required in 29 CFR 29, Part 5, Section 5.7
Submit directly to DOL – additional classification requirements

24. No contractor is paid without complying with federal labor standards provisions
Administrative Compliance Provisions - Documentation
EPLS check
Weekly pay to workers
Submission of weekly certified payrolls with statements of compliance (original signatures; revised payrolls
Spot-check – review of payrolls
Deficiency letters
Restitution (underpayments or from review of the HUD 11 not matching submitted payrolls.)

25. Report Contractors (non compliance) to HUD
Report to HUD
Workers complaint, if you are unable to resolve
Any potential criminal or complex enforcement matters, regarding contractors (non compliance)
Report Contractors (non compliance) to HUD
Ref: 29 CFR part 5, Section 5.7
Collective underpayments of $1,000 or more from one employer

26. SEMI-ANNUAL ENFORCEMENT REPORT

27. Semi-Annual Labor Enforcement Report via HUD 4710 Form
Statutory Requirement – Maintain files
PHAs, excluding Section 8 Only, report
Report reflects:
All contracts, subject to federal labor standards, awarded during the reporting period
If no contracts awarded during the period, “report 0”
Complaints
Restitution paid
CWHSSA
Overtime and Liquidated damages ($10 per violation)

28. Semi-Annual Labor Enforcement Report via HUD 4710 Form
Two Reporting Periods
Period One: Oct 1 thru Mar 31
Period Two: Apr 1 thru Sep 30
Due dates to OLR
Usually region will determine date to submit to them
In Region VII – Apr 5 and Oct 5

29. MAINTENANCE WAGE DETERMINATION PROCESS

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 Authorities
What 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 Form
What form is used for the approval?
ANS: HUD 52158
When is an “additional classification” required for maintenance employees and/or maintenance contractors?
ANS: For any work classification “not” listed on the approved
What 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 hit
What 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 ssn
Correct work classifications
Hourly rate(s) of monetary wages paid
Rates(s) of any bona fide fringes benefits provided
Number of the daily and weekly hours worked
Gross wages earned
All deductions taken
Actual 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 Form
Where 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 positions
City Human Resources – if the Authority is connected with the City and comply with the City’s personnel/human resources policy
What 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 discuss
Rule 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/4812LR
HUD Handbook , Rev 2
Links via
Program Offices
Labor Relations
Resources

40. On-line Resources

41. DAVIS-BACON RELATED WEB SITES
Department of Labor DBRA Homepage tm
Department of Labor Regulations
Department of Labor Forms

42. Office of Labor Relations References
Labor Relations Letters
On-the-Mark! Series
Available on-line in Labor Relations Library at:

43. DISCLAIMER
This 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.