$148k DIR Fine - Failure to File DAS 140/142 forms

Read the entire DIR Civil Wage Assessment against Doug Parks and Son Plumbing 2/08/16 here.

Affected subcontractor Doug Parks, individually dba Doug Parks and Son Plumbing (Parks) submitted a timely request for review of the Civil Wage and Penalty Assessment (Assessment) issued by the Division of Labor Standards Enforcement (DLSE) with respect to the Kings County Jail Tunnel, Holding Cell and Building Site (Project) in Kings County. The Assessment determined that $185,469.45 in unpaid prevailing wages and statutory penalties was due. BMY Construction Group, Inc. (BMY Construction), the general contractor, paid $36,969.46 for the wages owed to workers, including unpaid training fund contributions.

The issues for decision are:

- Whether the Assessment correctly reclassified the affected workers from the Pipe Tradesman prevailing wage rate to the Plumber prevailing wage rate;

- Whether the Assessment correctly reclassified the affected workers from the Underground Utility Tradesman prevailing wage rate to the Laborer prevailing wage rate;

- Whether Parks failed to pay the required prevailing wage rates for overtime work and is therefore liable for penalties under section 1813;

- Whether Parks failed to hire apprentices and/or failed to contribute to the apprenticeship training fund and is therefore liable for penalties under section 1777.7; and,

- Whether Parks failed to file certified copies of payroll records within ten days, after receipt of a written request from DLSE and is therefore liable for penalties under section 1776.


Kings County advertised the Project for bid on March 21, 2014, and awarded the contract to BMY Construction on June 3, 2014. BMY Construction subcontracted with Parks on June 24, 2014, to supply plumbing services for the construction of a transfer tunnel from the existing jail to the adjacent courthouse and holding cells, including a cafeteria and two bathrooms. Parks' employees worked on the Project from approximately July 16, 2014, through December 18, 2014. Parks presently continues to work on the Project.

Applicable Prevailing Wage Determinations (PWDs): The following applicable PWDs and scopes of work were in effect on the bid advertisement date: March 21, 2014.

Laborer CNC-23-102-1-2014-1): This is the rate used in the Assessment for all laborer work. The Laborer PWD classified location of work by Area and construction specialization by Group. DLSE identified the laborers on the Project as working in Area 2 and performing Group 3 type construction. The Laborer PWD contains a predetermined pay rate increase that went into effect before the beginning of work on the 3 Project.

DLSE demonstrated that Parks had misclassified his workers as pipe tradesmen and underground utility tradesmen. Scope of Work Provisions for Pipe Tradesman for 2014-1 states under Definition of Work Jurisdiction Between U.A. Pipe Tradesman and U.A. Plumber/Pipefitter that "All piping under, inside or on a building or structure is the work of the U.A. Plumber/Pipefitter." Parks conceded that his employees worked inside the structures.

Additionally, the Scope of Work Provisions for Underground Utility Tradesman for 2014-1 includes utility and utility pipeline construction work outside and appurtenant to the structure but does not include interior work. Furthermore, Underground Utility Tradesman may dig ditches by manual methods but the applicable scope of work does not provide for them to dig ditches using machines. DLSE elicited testimony that the two workers reclassified as laborers worked inside the structures at the jail and used jackhammers with spade bits to dig trenches.

On December 9, 2014, BMY Construction contacted Parks by email recommending that Parks resolve the issue of Parks paying the workers the required prevailing wage. Failing to resolve the issue, on or about December 22, 2014, three workers filed complaints against Parks.
The Deputy Labor Commissioner assigned to the case, Lori Rivera (Rivera), testified that Parks refused to rectify the underpayment despite Rivera presenting DLSE's concerns about the workers' classification to Parks. Additionally, Rivera testified to Parks having suffered a revocation of his Nevada contractor's license due to previous malfeasance.

Rivera's review of Parks' CPRs, payroll checks and timesheets revealed that Parks reported paying more money to workers on the Certified Payroll Records (CPRs) than he actually paid. For example, the CPR for one employee for the week ending July 22, 2014, shows net wages paid as $612.42, whereas Parks wrote the corresponding check for only $517.41. Additionally, the CPRs reported fewer hours worked than those hours stated by the workers on their timecards. For example, the CPR, for one week during the Project, showed 37 hours paid to a particular employee whereas the timecard showed that the employee worked 43 hours in the same week.

DLSE also found that Parks violated section 1777.5, which requires the employment of apprentices to work one hour for every five hours of journeyman work. Parks did not employ a single apprentice on the Project. DLSE assessed the violation for the full number of contract days because Parks did not submit contract award information to an applicable apprenticeship program. Parks committed two types of violation under 1777.5: 1) a failure to submit the contract award information for the craft; and 2) a failure to employ apprentices within the minimum required ratio for the craft. Parks employed both laborers and plumbers on the Project.

DLSE assessed penalties under section 1777.7 for two violations per day at 251 days for plumbers and at 245 days for laborers. DLSE did not mitigate the penalty from $100.00 because BMY Construction attached the applicable apprenticeship statutes and a checklist of Labor Law requirements. Furthermore, Parks did nothing to correct the ratio violations after Rivera brought the matter to his attention.

Further, DLSE found that Parks failed to request and hire apprentices. DLSE assessed penalties under section 1777.7 of $100.00 per violation for 992 violations, totaling $99,200.00. DLSE found that Parks' violations were willful and intentional, thereby warranting the maximum penalty.


Parks Was Required To Pay The Prevailing Rate For Plumber and Laborer For The Work Performed On The Project.

The single prevailing rate of pay for a given "craft, classification, or type of work" is determined by the Director of Industrial Relations in accordance with the standards set forth in section 1773. (Sheet Metal Workers Intern. Ass'n, Local Union No. 104 v. Rea (2007) 153 Cal. App.4th 1071, 1082.) The Director determines these rates and publishes general wage determinations (i.e. a PWD) to inform all interested parties and the public of the applicable wage rates for each type of worker that might be employed in public works. (§ 1773.) Contractors and subcontractors are deemed to have constructive notice of the applicable prevailing wage rates. (Division of Labor Standards Enforcement v. Ericsson Information Systems (1990) 221Cal. App.3 1114, 125.) In the unusual circumstance when the advisory scopes of work for two prevailing rates overlap, a conflict is created because no single prevailing rate clearly applies to the work in issue. In this limited situation, a contractor may pay either of the applicable prevailing wage rates for the work.

In this case, the disputed work falls clearly within the Plumber and Laborer scopes of work. The question is whether the disputed work also falls clearly within the Pipe Tradesman and Underground Utility Tradesman scopes of work entitling Parks to pay the lower Pipe Tradesman and Underground Utility Tradesman rates for the work. The Director finds that it does not and therefore she affirms the Assessment's reclassification of the affected workers from Pipe Tradesman to Plumber and Underground Utility Tradesman to Laborer. ·

The applicable prevailing wage rates are the ones in effect on the date the awarding body advertises the public works contract for bid. (See § 1773.2 and Ericsson, supra.) Section 1773.2 requires the body that awards the contract to specify the prevailing wage rates in the call for bids or alternatively to inform prospective bidders that the rates are on file in the body's principal office and to post the determinations at eachjob site.

In the instant case, Parks designated two classifications, Pipes Tradesman and Underground Utility Tradesman, for setting his employees' wage rates. Neither designation was appropriate because the scope of work defining Pipes Tradesman and Underground Utility Tradesman were limited to outside work whereas the work on the Project included inside work. Accordingly, DLSE properly reclassified the workers as Plumbers and Laborers.

The record does not establish that DLSE abused its discretion and, accordingly, the Director affirms 228 violations of penalties under section 1775 for $45,600.00 against Parks.

Parks Failed to Make Any Training Fund Contributions.

Moreover, the issue of willfulness arises in this situation due to Parks' failure to submit the training fund contribution. Section 1777.5, subdivision (m) (1) states that the contractor "shall contribute to the California Apprenticeship Council the same amount that the director determines is the prevailing amount of apprenticeship training contributions in the area of the public works site." Willfulness includes those matters in which the contractor "reasonably should have known of his or her obligations under the public works law." (§ 1777.1, subd. (e).) The omission to pay any of the required training funds supports a finding of willfulness as to DLSE' s setting of the penalty under Section 1775.

Parks Owes Overtime Penalties For Underpaid Workers.

The PWDs for Plumbers for Kings County (KIN-2014-1) and Laborers (NC-23-102-1-2014-1) establish the required Saturday overtime-hourly rates.

The record establishes that Parks violated section 1815 by paying less than the required prevailing overtime wage rate to several workers who worked on Saturdays. Unlike section 1775 above, section 1813 does not give DLSE any discretion to reduce the amount of the penalty, nor does it give the Director any authority to limit or waive the penalty. Accordingly, the Director affirms the assessment of penalties under section 1813 for eight violations at $25.00 per violation, totaling $200.00.

Parks Owes Penalties For Failure to Submit CPRs Timely.

Additionally, employers on public works must keep accurate payroll records, recording, among other things, the work classification, straight time and overtime hours worked and actual per diem wages paid for each employee. (§ 1776, subd. (a).) This is consistent with the requirements for construction employers in general, who are required to keep accurate records of the hours employees work and the pay they receive. (Cal. Code Regs., tit. 8, § 11160, subd. 6.)

Section 1776, subdivision (h) provides that:

DLSE made two requests for CPRs from Parks. Parks does not deny receipt of the requests from DLSE. Rather, Parks argues that he timely sent the CPRs to DLSE. Regardless whether Parks timely delivered some CPRs, DLSE states that the information provided was insufficient and the record shows that Parks never delivered one set of CPRs at all (those for week thirty-four of the Project). Parks does not affirmatively contend that he delivered the missing CPR to DLSE and provides no explanation why DLSE never received the contact information for a certain worker. Accordingly, the Director does not need to weigh the veracity of the testimony to affirm the assessment because Parks did not meet his burden with regard to the missing CPR and the missing worker's contact information.

Accordingly, the Director affirms DLSE's assessed penalties under section 1776 for five workers over seven days, at the statutory rate of $100.00 per day, totaling $3,500.00.

Parks Failed to Reguest Apprentices and Employ Apprentices.

Parks failed to request apprentices.

With respect to the requirement to issue a DAS 140, notifying the applicable apprenticeship programs of the contract award, Labor Code section 1777.5, subdivision (c) states in part:

Parks provided no contract award information to the applicable apprenticeship program(s) and Parks requested no apprentices from the applicable apprenticeship program(s). Parks acknowledged that he failed to provide a DAS 140 and a DAS 142 to either the Fresno Area Plumbers, Pipe and Refrigeration Fitters Joint Apprenticeship and Training Sub-Committee or P.H.C.C. of the Greater Sacramento Area Plumbers U.A.C. Parks also acknowledged that he failed to provide a DAS 140 and a DAS 142 to the Northern California District Council of Laborers Construction Craft Laborers J.A.T.C.

Parks employed no apprentices.

Section 1777.5 and the applicable regulations require the hiring of apprentices to perform one hour of work for every five hours of work performed by journeymen in the applicable craft or trade (unless the contractor is exempt, which is inapplicable to the facts of this case). In this regard, section 1777.5, subdivision (g) provides:

The ratio of work performed by apprentices to journeymen employed in a particular craft or trade on the public work may be no higher than the ratio stipulated in the apprenticeship standards under which the apprenticeship program operates where the contractor agrees to be bound by those standards, but, except as othe1wise provided in this section, in no case shall the ratio be less than one hour of apprentice work for every five hours of journeyman work.

Parks did not hire a single apprentice for the Project.

The Penalty for Noncompliance.

Parks "knowingly violated" the requirement of a 1:5 ratio of apprentice hours to journeyman hours for plumber and laborer apprentices, arid the record establishes that this violation was "knowingly committed." The substantial evidence proved that BMY Construction had provided to Parks from the beginning of the Project the requirement for contacting the applicable apprenticeship programs and hiring apprentices from those programs. Additionally, Parks did not hire apprentices after Rivera brought the matter to his attention. Since Parks knowingly violated the law, a penalty should be imposed under section 1777. 7 at $100.00 per violation. Thus, DLSE properly assessed penalties for 992 violations of section 1777.7 totaling $99,200.00.


Doug Parks dba Doug Parks and Son Plumbing failed to pay his workers the required prevailing wages for the disputed work, as he paid some employees the Pipe Tradesman rate or the Underground Utility Tradesman rate rather than the applicable Plumber rate or Laborer rate, respectively. The portions of the Assessment reclassifying the affected workers from Pipe Tradesman to Plumber or from Underground Utility Tradesman to Laborer, for that work, as appropriate, and the associated penalties assessed under sections 1775 are therefore affirmed. The balance of the wage determination is undisputed and is therefore also affirmed in full. Doug Parks dba Doug Parks and Son Plumbing underpaid its workers for their work on the Project in the aggregate amount of $36,969.26, including unpaid training fund contributions.

DLSE did not abuse its discretion by setting the penalty for these violations under section 1775, subdivision (a) at the maximum rate of $200.00 per violation for 228 violations on the Project, totaling $45,600.00.

Penalties under section 1813 at the rate of $25.00 per violation are due for eight violations on the Project, totaling $200.00 in penalties.

Penalties under section 1776 at the rate of $100.00 per day for five workers over seven days, for a total of $3,500.00 in penalties, are due because Doug Parks dba Doug Parks and Son Plumbing failed to submit Certified Payroll Records timely and provide worker contact information.

Doug Parks dba Doug Parks and Son Plumbing committed 992 violations under section 1777.5 both for his failure to submit contract award information to the applicable apprenticeship programs and for his failure to request and hire apprentices for the Project.

DLSE did not abuse its discretion by setting the penalty for these violations under section 1777.7, subdivision (a) at the maximum rate of $100.00 per violation for 992 violations on the Project, totaling $99,200.00.

The amounts found remaining due in the Assessment as affirmed by this Decision are as follows:

Penalties under section 1775, subdivision (a): $45,600.00

Penalties under section 1813: $200.00

Penalties under section 1776: $3,500.00

Penalties under section 1777.7: $99,200.00

TOTAL: $148,500.00

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