Monday, June 4, 2018

Davis-Bacon Act Violations Cost Company $625 Thousand

The Davis-Bacon Act (in conjunction with the Contract Work Hours and Safety Standards Act) requires that contractors on Federal programs submit weekly payroll reports certifying that they correctly classified their workers according to work actually performed and that workers be paid not less than prevailing wages and benefits for each classification. Prevailing wages are determined by the U.S. Department of Labor.

A whistleblower accused James River Air Conditioning Company of underpaying its workers and submitting false certified payroll reports for work it performed on several federal construction and renovation projects. The Justice Department evidently saw merit in the whistleblower allegation and decided to initiate an investigation into the matter.

The investigation was coordinated among a gaggle of investigative agencies including including the Inspector Generals of the Labor Department, the Defense Department and the Veterans Affairs Department as well as the Army Criminal Investigation Command. Certainly all of those resources cost the Government more than the $625 thousand James River agreed to pay to get the matter behind them - especially after paying the whistleblower $106 thousand as his qui tam reward.

There was no determination of civil liability in this matter. The Government's claims settled by this agreement were allegations only. Certainly James River was glad to put this matter to rest.

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