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
Fannie.J.Woods@hud.gov
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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
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Reorganization Plan No. 14 of 1950
Davis Bacon (DB) Act
◦ Prevailing wage requirement; pay weekly
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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.
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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
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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
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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.
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Compliance Officer – Appoint
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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
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Contract Agreements with prime contractors/subcontractors
includes:
◦ Appropriate labor standard provisions
◦
 HUD 5370 Form > $100K
 HUD 5370 EZ Form < $100K
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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)
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Eligibility Documentation
 Check eligibility of prime or potential contractors before contract award
 www.epls.gov
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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
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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
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Project Wage Decision
◦ Approved additional classifications
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Other DOL required posters
◦ EEO
◦ FLSA
◦ Go to www.dol website –posters are available – may download
and/or request the larger posters from DOL
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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
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Signed Contract Agreement
Project Wage Decision
Construction Start Notice
Lst of subcontractors-trade-points of contact - $$$
amount
 Check eligibility at www.epls.gov
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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
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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
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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
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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,
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Net Pay
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Gross pay minus deductions
Matches amount actually paid to the worker
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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
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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
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When discovered? Usually◦ During payroll reviews
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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
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Resubmitted payrolls are labeled “revised”
and carry dates of the initial payrolls
◦ Do not write on payrolls
◦ Do not return any payrolls
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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.
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Develop intake process
Investigate allegations
Determine validity of allegations
Resolve complaint –
Document actions taken/resolution
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Monitor grantees to assess grantee
performance of labor standards
responsibilities (may apply to city/county agencies)
◦ Ensure corrective action for non compliance
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Collect and submit to HUD
◦ All enforcement reports required in 29 CFR 29, Part
5, Section 5.7
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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.)
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Report to HUD
◦ Workers complaint, if you are unable to resolve
◦ Any potential criminal or complex enforcement
matters, regarding contractors (non compliance)
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Report Contractors (non compliance) to HUD
◦ Ref: 29 CFR part 5, Section 5.7
 Collective underpayments of $1,000 or more from one
employer
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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)
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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
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Making Davis Bacon Work, January 2012
◦ http://portal.hud.gov/hudportal/HUD?src=/program_offices/administratio
n/hudclips/guidebooks/4812LR
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HUD Handbook 1344-1, Rev 2
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Links via
◦ www.hud.gov
 Program Offices
 Labor Relations
 Resources
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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/
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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.
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