Federal Labor Standards & Maintenance Wage Rates (HUD Programs) June 21, 2012 Agency: HUD Region VII, Office of Labor Relations (OLR) Presenter: Fannie Woods, Director, OLR Contact Information: 913.551.5577 [email protected] 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 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. Applies to construction and constructionrelated 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 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. Compliance Officer – Appoint Bid Documents include: ◦ Is the ED the right person for this position? ◦ Appropriate labor standard provisions HUD 5370 Form > $100K HUD 5370 EZ Form < $100K ◦ Applicable federal wage rate decision www.wdol.gov Contract Agreements with prime contractors/subcontractors includes: ◦ Appropriate labor standard provisions ◦ HUD 5370 Form > $100K HUD 5370 EZ Form < $100K 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 www.epls.gov 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 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 www.dol website –posters are available – may download and/or request the larger posters from DOL 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 www.epls.gov 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 Go to below link for instructions/download form www.dol.gov/whd/forms/wh347instr.htm Weekly Certified Payrolls – Workers paid weekly! ◦ From all contractors performing work on the job – different rules for: OLR Letter 96-01, www.hud.gov – 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 ◦ 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 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 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 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 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 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 “revisedrestitution” New statement of compliance May request supporting documentation to verify that payment was made and worker received it. Develop intake process Investigate allegations Determine validity of allegations Resolve complaint – Document actions taken/resolution 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 ◦ 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.) 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 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) 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 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 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 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 52158. What if the Authority contracts out all of its maintenance functions, is the Authority still required to participate in this process? ◦ANS: YES 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 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 What happens if the Authority fails to pay the maintenance worker at least the amount of the total wages approved on the HUD 52158 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? Where does an Authority get comparable wage data? ◦Collective Bargaining Agreements (wage rates apply—regardless) ◦www.bls.gov ◦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 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 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 Making Davis Bacon Work, January 2012 ◦ http://portal.hud.gov/hudportal/HUD?src=/program_offices/administratio n/hudclips/guidebooks/4812LR HUD Handbook 1344-1, Rev 2 Links via ◦ www.hud.gov Program Offices Labor Relations Resources Department of Labor DBRA Homepage www.dol.gov/esa/programs/dbra/index.h tm Department of Labor Regulations www.dol.gov/esa/regs/cfr/whdcfr.htm Department of Labor Forms www.dol.gov/libraryforms/ Labor Relations Letters On-the-Mark! Series Available on-line in Labor Relations Library at: http://www.hud.gov/offices/olr/library.cfm 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. 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