1. HUD Region VII OFFICE OF LABOR STANDARDS AND ENFORCEMENT
Federal Labor Standards Compliance Training
Presenter: Fannie Woods, Director, Office of Labor Standards and Enforcement
U. S. Department of Housing and Urban Development (HUD), Region VII, KC, KS
Event: Lincoln, NE NAHRO
Date: September 16, 2015
Contact:

2. OVERVIEW Monitoring - Management System Effectiveness
Certified Payrolls – Common Deficiencies
Compliance Recommendations
Mandatory Reporting Requirements
1099/Independent Contractors –DOL and HUD updates

3. Monitoring - Management System Effectiveness
What may constitute a monitoring finding of “an ineffective and/or no management system to administer and enforce Federal Labor Standards?”
Common Management System Issues

4. Common Management System Issues
FLS knowledge, education, and training
Maintenance v construction and/or construction- related work
Not a priority for PHAs
Consultant-driven w/o PHA oversight
*Executive Director (ED) function v staff function
No written FLS procedures
Incorrect and possibly “misuse” of force account labor
Incorrect solicitations or “quick fixes”

5. Common Management System Issues
Missing Documentation
No Contracts
Contracts w/o required Federal Labor Standards language; w/o required applicable version of the HUD Form 5370; w/o required maintenance or Davis-Bacon wage decision
No verification of contractor’s and worker’s eligibility
No subcontractors list and applicable verification
No certified payrolls
No inspection reports or Records of Employee Interview, HUD-Form 11

6. HUD-11 Interview Form (Also available in Spanish)

7. HUD-11 Interview Form (Also available in Spanish)

8. HUD-11 Interview Form (Also available in Spanish)
Compare to payroll. Complete this part, #17a and 17b.

9. Common Management System Issues
Invoiced payments vs weekly payments
Maintenance v construction/construction-related work
No weekly payrolls received
No payroll reviews/analysis/discrepancies identified and resolved
Classifications
Misclassifications
Missing Trades (not on wage decision)
1099 workers/independent contractors
Apprentices
Out-of-ratios
No documentation

10. Certified Payrolls Deficiencies
Completing, Submitting Certified Payrolls

11. Common Deficiencies Prevailing Wage Rate and Overtime Calculation
Total Prevailing Wage (PW) – Wages not meeting PW
Fringe Benefits – No documentation
Overtime Calculations - Miscalculations
Other Deductions – No documentation
Statements of Compliance – Not completed properly
Ghost Employees – Interviews but not on payrolls

12. Common Deficiencies Wages paid in cash Compliance Excess
Too few or irregular hours
Week work hours – less than 30 and 40 most payrolls
High concentration of laborers
Skilled jobs but unskilled workers
Wages paid in cash
No documents to verify payments
Compliance Excess
Too much documentation submitted

13. Common Deficiencies– Apprentices
Require the following:
Individual Registration for the apprentice
Select pages from the DOL Approved Apprenticeship Program Standards
Title Page (shows name of program)
Page reflecting ratio of apprentice to journeyman
Page reflecting the pay scale for apprentices
Includes apprenticeship level and percentage of journeyman’s pay for each level
Page reflecting fringes
IF SILENT on fringe benefits, pay, in cash, fringe benefit on wage decision.
Signatory Page (reflects signatories to agreement)
Absent this information, pay full journeyman's rates

15. Common Deficiencies -Fringe Benefits
Supporting Documentation
ONLY when the rate of pay is less than the total hourly prevailing wage
Required supporting documentation
Provide an “Itemized Fringe List” for each employee that lists:
Each fringe benefit
The hourly value of each fringe benefit
Total hourly value of the fringe benefits
Each employee reflected on the certified payroll
The name, address, contact name, and contact person for the 3rd Party Administrator for each Fringe Benefit
The frequency of deposits

16. Common Deficiencies – Other Deductions
Supporting Documentation
Child support, garnishment, other court ordered payment: SUBMIT COURT ORDER
Union dues and related items: SUBMIT COLLECTIVE BARGAINING AGREEMENT (CBA)
Telephones, vehicles, tools, uniforms, lodging, rent, loans, advance pay, any other than the above: SUBMIT WRITTEN, DATED, SIGNED AUTHORIZATION FROM WORKER “before job started.”
Itemized each deduction, the amount, frequency, and repayment period
NOTE: Not all of these authorized items may be permissible deductions and may be disallowed.

17. X Great Subcontracting 123 Main Street, Somewhere, CA 91245 8
May 18, 2013
Police Dpt. Expansion
10435 M T W Th F Sa Su 17 12 13 14 16 15 18
SDI
Medi.
401K
Jim Smith XXX-XX-1234
$392.80 4
Laborer Group 1, Area B
$36.50
$9.71
$9.69
$3.92
$29.64
$89.46
$472.94 8 8
$49.10
$562.40

18. 4 8 8 8 8 Laborer Group 1, Area B Laborer Apprentice

21. Common Deficiencies -Fringe Benefits
Statement of Compliance (SOC)
Block 4a not checked -- fringe benefits paid
Block 4b not checked – fringe benefits not paid
If combination of both – nothing indicated
In remarks, state the hourly value of the paid fringe benefits and hourly value of cash fringe benefits
Cash fringe benefit added to worker’s basic rate of pay

22. Statement of Compliance
Requires Original Signature
Requires signature from company President, Owner, or Officer
OR from one of these – written, dated authorization
Authorizing another person to sign

23. Sally Jones Sally Jones, Payroll Officer December 1, 2012 Sally Jones
Great Subcontracting
Police Facility Expansion
October November
Great Subcontracting X
Sally Jones, Payroll Officer
Sally Jones

24. Reporting Requirements
Mandatory Reporting
Semi-Annual Labor Standards Report
Single contractor w/ restitution of $1K or more (report, via letter, quarterly, to HUD OLSE rep)
Annual Maintenance Wage Determination

25. Semi-Annual Labor Standards Report
Applies only to Federally-funded construction . . .
Submit NLT Apr 5 and Oct 5 (only for work funded during one of the following periods)
Period 1 – Oct 1 thru Mar 30
Period 2 – Apr 1 thru Sep 30
Use HUD Form 4710, Semi-Annual Labor Standards Enforcement Report – Local Contracting Agencies (HUD Programs)
Send to HUD OLSE Rep for your state

26. Single Contractor – Restitution
Other Reports
Single Contractor – Restitution
Submit report quarterly to HUD OLSE Representative
Applies to any one contractor w/ restitution of $1K or more
Maintenance Wage Determinations
Applies only to PHAs (excludes Section 8 Only PHAs)
Submit, via HUD Form 4750, Maintenance Wage Rate Recommendation, to HUD OLSE Representative
Submit 45 days prior to start of PHA Fiscal Year

27. Compliance - Recommendations
Develop and implement written procedures for the administration and enforcement of Federal Labor Standards -- applies to the HUD LCAs
Develop written contracts with the project wage decision and other Federal Labor Compliance language in all contracts with all subcontractors (regardless of tier level) – general contractors and LCAs enforce
Verify all contractors working on the construction work are eligible to work on Federally-funded projects – via – and document the results
Verify all workers working on the project are eligible to work in the United States – use
Pay workers weekly - no exceptions
Ensure sole proprietors or self-employed workers, with no crews, performing maintenance and/or physical work on the job site are paid at least the weekly prevailing wage rate for trade performed
Submit weekly certified payrolls and statements of compliance
Ensure this is based on a one-week payroll and not a divided two-week payroll

28. Compliance - Recommendations
Submit authorization letters for SOC signatures and “other” deductions
Submit the required apprentice information and apprenticeship program standards
Classify and pay workers correctly
Paid hourly rate of pay + fringes must equal “total” hourly prevailing wage rate
Obtain break out of each fringe benefit and the hourly value of each for each worker performing work on a HUD-funded/assisted and/or construction work
Require the correct documents to verify workers classified as apprentices are registered in a DOL-approved and/or state-approved apprenticeship program
Acquire the individual registration forms
Acquire the applicable Apprenticeship Program Standards
Identify potential violations pertaining to 1099 workers/independent contractors – refer to appropriate State Agency
Review, analyze, identify and correct violations of Federal Labor Standards within 30 days

29. Compliance Recommendations
Develop more comprehensive Federal Labor Standards presentations during pre construction briefings—maintain minutes of these meetings
Accept, investigate, and document workers’ complaints
Refer complex cases to HUD OLSE for review -- HUD, if necessary, will refer to DOL for review/investigation
Submit Annual and Semi – Annual Reporting:
Submit the HUD 4750, Request for Maintenance Wage Decision
Complete and submit the required Semi-Annual Labor Standards Enforcement Report due on April 5th and October 5th of each year
Withhold money from current contracts or “cross-withhold” from other Federal contracts for contractors and subcontractors violating Federal Labor Standards
Do not allow construction work, that triggered compliance with Federal Labor Standards, to close with outstanding/unresolved labor issues

30. Administrator’s Interpretation No. 2015-1
DOL Administrator’s Interpretation 1099 Workers/Independent Contractors
Administrator’s Interpretation No
Dated: July
Guidelines for categorizing workers as 1099/Independent Contractors
Examples of the application to various construction workers
Co-partners
Bonafide business vs non bonafide
Economic realty factors – economic dependency on the one job
HUD OLSE Summary Guidance
Handout
HUD OLSE Letter 96-01, Labor standards compliance requirements for self-employed laborers and mechanics (aka Working Subcontractors) (Rev 1)

31. Resources
All resources pertaining to HUD’s Administration and Enforcement of Federal Labor Standards
HUD Library (includes OLSE Labor Letters)
HUD Handbook
HUD Contractors Guide to . . .
HUD Guide for State, PHAs, and Indian Tribes . . .
Links to DOL websites for Davis-Bacon
HUD Forms pertaining to Davis-Bacon
Names and contact information for HUD OLSE staff throughout the country
Names and contact information for HUD HQ OLSE Staff
Training Opportunities

32. Gateway Tower II, 5th Floor
Resources – OLSE Staff
Fannie J. Woods, Director
Michele J. Green, Senior Contractor Industrial Relations Specialist Jurisdiction: Missouri, Wyandotte and Johnson County, KS
William Moore, Contractor Industrial Relations Specialist
Jurisdiction: Kansas (excluding Wyandotte and Johnson County, KS) and Iowa
400 State Street
Gateway Tower II, 5th Floor
Kansas City, KS

33. SUMMARY

34. 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.

35. HUD Region VIII OLSE