Specific Steps In Conducting DBA/DBRA/CHWSSA Investigations

The following guidance is intended to list the various steps that are typically undertaken by contracting agencies and WHD in conducting a DBA/DBRA/CWHSSA investigation.

Preliminary Steps

  1. Obtain the following information:
    1. Copy of the labor standards clauses in the contract.
    2. Copy of the Davis-Bacon wage decision(s) included in the contract, and in the case of multiple schedules, any instructions concerning their application.
    3. Copies of the certified payrolls submitted by the contractor under investigation.
    4. Employer identification number.

Initial Employer Contact

  1. A responsible official of the firm must be contacted at the start of the investigation.
  2. When investigating a subcontractor, find out what information on labor standards and wage determinations have been provided by the prime contractor (or higher-tier subcontractor) to the subcontractor. Ask the subcontractor for a copy of the subcontract, if one exists.
  3. When a subcontractor is being investigated, the prime contractor should be notified at the beginning of the investigation.
    1. The prime contractor can provide information on the subcontractor's performance and may have records relating to the number of employees the subcontractor had on the project, the hours they worked, and the period of time they were on the project. The prime contractor should be asked to provide a copy of the subcontract, if it exists.
    2. The prime contractor has responsibility for compliance on the contract and is liable for back wages not paid by the subcontractor, and may decide to withhold final payment from the subcontractor until the back wage issues are resolved.
  4. Inform the employer that the purpose of the investigation is to determine compliance with the pertinent statutes and regulations and outline in general terms the scope of the investigation, including the examination of pertinent records, employee interviews and physical inspection of the project.
  5. Obtain the exact legal name of the firm and any trade names, the full address, full names of owners or officers and their titles, number of persons employed, name and address of any subcontractors, and such similar information as may be necessary to conduct and complete the investigation.

Examination of Certified Payrolls

  1. The contractor's certified payrolls should be examined for accuracy, completeness, and true representation of the facts. The examination should cover the current or most recent payrolls as well as those for selected periods which reflect the practice of the contractor or subcontractor during the life of the contract.
    1. Check for completeness and accuracy of the payrolls as to the names, addresses, job classifications, hourly wage rates, daily and weekly hours worked during the payroll period, gross weekly wages earned, deductions made from wages, and net weekly wages paid the employee. Notice if there are distinctions made among the various classifications.
    2. If the Contract Work Hours and Safety Standards Act is applicable and an employee worked in excess of forty hours in any workweek, determine whether time and a half the employee's regular rate was paid.
    3. Certified payrolls should be examined for discrepancies such as a disproportionate number of laborers, apprentices or trainees on the project.
    4. The wage rates should be compared against those listed on the wage determination. If workers perform work in more than one classification, the payroll records should accurately reflect the time spent working in each. Unlisted classifications should be identified and additional classification procedures initiated, if applicable.
    5. Check certified payrolls for information on contributions to fringe benefit plans and/or cash paid in lieu of fringe benefits.

Examination of Records

  1. Examine the current or most recent payroll as well as those for selected periods which reflect the practice of the contractor or subcontractor during the life of the contract. The examination should include a review of the basic time cards, time sheets, or other work or personnel records of a representative number of employees in each classification. These records should be checked against the certified payrolls in order to disclose any possible discrepancies, or to give reasonable assurance that none exist.
  2. Examine documents which indicate that the firm has made contributions (or incurred costs) to fringe benefit plans. These documents might include: portions of the pension plan; documentation from the Internal Revenue Service that indicates the plan has been approved by the IRS; and records of contributions made.

Check for Compliance with Apprenticeship/Trainee Requirements

  1. Apprenticeship/trainee program information should be obtained and examined to verify that the program has been approved by the appropriate authority. If the contractor's evidence is not sufficient, contact ETA/OA and/or the state apprenticeship council (where appropriate) for verification. A list of local ETA/OA offices is available at https://www.doleta.gov/oa/stateoffices.cfm#CO.
  2. Obtain copies of the individual employees' apprentice/training registration forms for the file, as well as copies of the approved apprenticeship/training program itself.
  3. The ratio of apprentices to journeyworkers in any classification on the project should not exceed the ratio provided for in the relevant apprenticeship/training program. The ratio is determined on a daily basis, not weekly.

Determine if a Conformance is Necessary

  1. Determine if the wage determination contains classifications and wage rates for all the types of work performed on the contract.
    1. If the applicable wage determination does not contain a classification for the work performed, the conformance procedure in 29 C.F.R. § 5.5(a)(1)(ii) must be followed. Contracting agencies cannot arbitrarily determine a rate.
    2. Questions as to whether or not a conformed rate has been approved should be coordinated with WHD.

Employee Interviews

  1. Employee interviews are essential to the completeness of the investigation.
    1. They should be sufficient in number to establish the degree of adequacy and accuracy of the records and the nature and extent of any violations.
    2. They should also be representative of all classifications of employees on the project under investigation.
    3. In some situations interviews with former employees may be appropriate.
    4. In cases involving alleged misclassification and/or falsification of payroll records, it is important to account, through the interview process, for as many employees as possible who worked on the contract.
    5. Employees should be questioned regarding other employees they worked with and the duties performed by those employees.
  2. Each employee should be informed that the information given is confidential to the fullest extent of the law, and that his/her identity will not be disclosed to the employer without the employee's written permission insofar as the law permits. (See 29 C.F.R. § 5.6(a)(5).)
  3. Place of interview
    1. Employees currently employed may be interviewed during working hours on the job, in accordance with 29 C.F.R. § 5.5(a)(3)(ii), provided the interview can be properly and privately conducted on the premises.
    2. In cases of falsification of records, fear of reprisals or intimidation, it may be more advisable to conduct the interview elsewhere, such as in the employee's home, at the agency's office, or other suitable place where it may be arranged.
    3. Employees should never be interviewed in the presence of the employer, another employee, or any other person.
  4. Telephone Interviews
    1. Ordinarily, an interview should be made by telephone only if a personal interview is impracticable. When a telephone interview is used, it is suggested that the contracting officer send the employee the statement together with a request that the employee read the statement, make and initial any changes, sign and date it and return the statement to the contracting officer. It is suggested that the contracting officer keep a copy of the statement until the original is returned.
  5. Mail interviews
    1. Ordinarily, an interview should be made by mail only if a personal or telephone interview is impracticable.
  6. Preparation of interview statements
    1. When a written statement is taken, it should be recorded in the manner stated by the employee; it should be read by him/her, and contain a statement that it has been read and that it is correct. The contracting officer may restate or summarize the employee's remarks, but should do so in the first person and should phrase it in the employee's manner of speaking.
    2. The statement should be signed by the employee and the signature, except in mail interviews, should be witnessed by the responsible agency official. In government contract cases, it is preferred that all interviews be signed. Where the statement is not signed, the contracting officer should give, either in the statement or his/her report, the employee's reason for not signing. Any changes in a signed employee statement should be initialed by the employee.
    3. Each interview statement should contain the following information:
      1. Place and date of interview.
      2. Name of employer (firm).
      3. Name and permanent address of employee being interviewed.
      4. Employment status (whether present or former employee).
      5. Period(s) of employment.
      6. If an apprentice, the age, date of birth, and information concerning his status as an apprentice.
      7. The statement should include specific information regarding the:
        1. rate(s) of pay and wages received,
        2. hour for starting/stopping work and daily/weekly hours worked,
        3. manner in which time and work are recorded,
        4. job classification(s) and exact work performed.
        In cases alleging misclassification, the interview statement must specifically address the various types of duties performed. It is not sufficient for an employee to only state he/she was a carpenter. The interview must state the specific carpentry duties, and the tools and materials used. If an employee worked in more than one classification, the employee must be asked how much time he/she spent in each classification.
      8. When possible, the interview statement should corroborate statements given by other employees. For example, the employee should be asked to identify other workers who performed the same work.
      9. The interview should cover all the allegations of violations (particularly those in a complaint).
      10. The interview should also cover any other details necessary to indicate accuracy of the employer's records, statements, or certifications.
    4. All interview statements must be legible.

Restrictions on Disclosure of Information to Contractors

  1. The contracting officer should never release interview statements to a contractor. The contracting officer should never tell any employee the amount of back wages computed.

Case Record

  1. Transcriptions of records and computations of back wages must be made when violations are found.

Discharging DBA/DBRA Minimum Wage and Fringe Benefit Obligations

  1. "Prevailing wage" is made up of two interchangeable components - basic hourly wages and fringe benefits.
    1. Both may be paid in cash;
    2. Payments can be made or costs incurred for "bona fide" fringe benefits; or
    3. Any combination thereof.
    1. Additional discussion of how the Davis-Bacon prevailing wage obligation can be met, with examples, is provided in the discussion of "Fringe Benefits" in the "" chapter of this resource book.
  2. Monetary wages paid in excess of the Davis-Bacon minimum wage may be used as an offset or credit to satisfy fringe benefit obligations, and vice versa.
  3. Fringe benefits listed in the applicable Davis-Bacon wage determination must be paid for all hours worked - both straight time and overtime hours.
  4. Excess payments for overtime may not be offset/credited towards minimum wages due.
  5. Excess wages paid for work in one classification may not be offset/credited towards wage deficiencies in another classification. Under DBA/DBRA, each classification stands alone.

Resolution of Disputes Regarding Proper Classification of Workers

  1. To determine the proper classification for work performed on a Davis-Bacon covered project, it may be necessary to examine local area practice. An "area practice survey" may be conducted by the WHD or by the contracting agency to determine proper classification of workers in accordance with local prevailing area practice. An overview of this topic is provided in the "" chapter of this resource book.

Determining Compliance with CWHSSA

  1. See the "" chapter of this resource book for a detailed overview of determining compliance with CWHSSA overtime pay requirements. That discussion includes examples of how to assure that CWHSSA requirements are met.

CWHSSA Liquidated Damages

  1. Liquidated damages are computed at $10.00 per day per employee for CWHSSA violations.


    Example:
                                           M    T    W    T    F    S    S    TOTAL
    REGULAR TIME         10   10   10   10  10    5    0      55


    In the above example, no overtime premium was paid. The 15 weekly overtime hours were worked on two calendar days, Friday and Saturday.


    Thus, $20.00 in CWHSSA liquidated damages would be computed.

  2. The decision on whether to assess liquidated damages is made by the federal contracting agency.
    1. The contractor should be advised of the potential liquidated damages, and that they will be advised of the contracting agency's determination concerning the assessment of liquidated damages.
  3. As a matter of administrative policy, liquidated damages are not computed for employees whose CWHSSA back wages are less than $20.
  4. Liquidated damages in excess of $500 may be waived or adjusted only with the concurrence of the appropriate WHD Regional Administrator. (At https://www.dol.gov/agencies/whd/government-contracts/construction/regions, see the listing of "WHD Regional Offices.")
  5. If a federal Agency Head finds that a sum of liquidated damages administratively determined to be due under CWHSSA for a contract is $500 or less, an appropriate adjustment may be made in such liquidated damages or the contractor or subcontractor may be relieved of liability for the liquidated damages without submitting recommendations or a report to the WHD if the Agency Head finds that:
    1. the sum of liquidated damages computed is incorrect, or
    2. the contractor or subcontractor inadvertently violated the provisions of CWHSSA notwithstanding the exercise of due care on the part of the contractor or subcontractor involved. 40 U.S.C. 3702(c); 29 C.F.R. §§ 5.8(d) and 5.15(c)(3).

Overtime Requirements under the Fair Labor Standards Act, as amended

  1. CWHSSA requires the payment of an overtime premium when a laborer or mechanic works in excess of 40 hours in a work week on covered contract(s). Overtime hours not subject to CHWSSA may be subject to FLSA overtime pay requirements.
  2. Where questions arise concerning overtime pay obligations under the FLSA, referral to the local WHD office is appropriate.


Consulting Services We Provide

  • Review public works preconstruction contracts
  • Monitor DIR contractor/subcontractor certified payrolls
  • Audit labor classification for each worker employed
  • Review DIR pre-DAS 140/142 submissions
  • Review CAC training fund contributions form CAC-2
  • Review DIR Fringe Benefits Statement PW-26
  • Monitor DIR wage determinations
  • Audit fringe benefits allowances
  • Review DIR holiday payment requirements
  • Audit DIR travel & subsistence requirements
  • Caltrans Labor Compliance
  • County of Sacramento Labor Compliance
  • City of Los Angeles Labor Compliance
  • Los Angeles Unified School District Labor Compliance
  • Federal Davis-Bacon Project Monitoring
  • Federal DBE Implementation & Review
  • Federal FAA AIP Goal Setting
  • DIR & Davis-Bacon Training
  • DIR Civil Wage Penalty Review
  • Local-Hire Review (e.g., San Francisco)
  • Skilled and Trained Workforce

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