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Prepared statements, letters, supplemental material, etc.—Continued

Chiles, Hon. Lawton, a U.S. Senator from the State of Florida :

Letter to Chairman Thompson, dated May 21, 1971, enclosing

letter from M. Dean McCroskey, president, Local Lodge 773,

International Association of Machinist and Aerospace Work-

ers, dated May 11, 1971.

Statement of------

Dishong, E. D., president, Transport Workers Union of America,

AFL-CIO, Guided Missile Local 525, letter to Hugh Duffy, dated

May 11, 1971-------

Franklin, Happy, president, A.B.C. Food Service, Inc., El Paso, Tex.,

"Findings of Fact, Conclusions of Law, and Decision of the Hearing

Examiner” a report entitled--------
Gruber, Stanley, general counsel, National Maritime Union of Amer-

ica (AFL-CIO) statement on behalf of -

Jacobs, David L., business manager, Local 1057, Laborers Interna-

tional Union of North America, Laredo Air Force Base, Tex. :

Appendix I.---Predetermination relating to Palomar Corp. (table)-

Appendix I(a).–Revised predetermination relating to Palomar

Corp. (table) ------

Appendix II.-Data record (table)-------

Keller, Robert F., Acting Comptroller General of the United States,

letter to Chairman Thompson, dated May 14, 1971, information on
the current practice of limiting the term of most or all service con-

tracts awarded by the Federal Government to 1 year-------

Long, Hon. Clarence D., a Representative in Congress from the State

of Maryland, letter to Chairman Thompson, dated May 13, 1971,

enclosing letter from James D. Claxton, president, Local 1231,

Amalgamated Municipal Employees, Baltimore, Md., dated May 7,

1971

McCart, John A., operations director, Government Employees Council

of the AFL-CIO, statement of_-----

McGahey, James C., president, International Union, United Plant

Guard Workers of America (UPGWA):

Exhibit A.--Statement in support of H.R. 1678 and H.R. 6088,

January 27, 1964_--

Exhibit B 1.-Register of wage determinations and fringe benefits

under the McNamara-O'Hara Service Contract Act, 3-29-67

(table) ------

Exhibit B 2.-Register of wage determinations and fringe benefits

under the McNamara-O'Hara Service Contract Act, Decem-

ber 18, 1969, (table)-------

Exhibit B 3.-J. P. Holloman, president, Local No. 600, Dothan,

Ala., letter to Wage and Hour Division, Department of Labor,

dated October 9, 1970--------

Exhibit B 4.-Register of wage determinations and fringe benefits

under the Service Contract Act (table)---

Exhibit B 5.-J. P. Holloman, president, Industrial Maintenance

Services, Inc., letter to Jack Russell, Grossbeck, Tex., dated

November 9, 1970------

Exhibit B 6.-J. P. Holloman, letter to Jack Russell, dated Decem-.

ber 2, 1970.--.

Exhibit C 1.-James C. McGahey, letter to Clarence T. Lundquist,

administrator, Wage and Hour and Public Contracts Division,

U.S. Department of Labor, dated August 1, 1966..

Exhibit C 2.--Register of wage determinations and fringe benefits

under the McNamara-O'Hara Service Contract Act (table)---

Exhibit C 3.--Richard H. Anthony, director, Region 8, UPGWA,

letter to Clarence T. Lundquist, dated September 19, 1966------

Exhibit C4.-Richard H. Anthony, letter to James C. McGahey,

dated October 17, 1966---

! Statement of ------------------------------- -----------------

Suppplement to statement of_-

O'Connell, Francis A., legislative director, Transport Workers of Amer-

ica, letter to Hugh Duffy, dated March 22, 1971.:-

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Prepared statements, letters, supplemental material, etc.—Continued

O'Hara, Hon. James G., a Representative in Congress from the State
of Michigan:

"Brief in Support of Government's Contention," a brief entitled..
"Complaint," a brief entitled.-------
"Decision of the Administrator,” a brief entitled------
"FBI Probing Ft. Carson Contract," a newspaper article entitled.
"Findings of Fact, Conclusions of Law, and Decision of the

Hearing Examiner," a brief entitled-------
"SBA Says Trash Firm Unqualified," a newspaper article entitled.

Statement of--------------
Parrish, Chester W., president, National Federation of Post Office

Motor Vehicle Employees, AFL-CIO, statement of.--
Rontal, R. C., business manager, Local Union 2182, International

Brotherhood Electrical Workers, Santa Maria, Calif., letter to Con

gressman O'Hara, dated April 5, 1971.
Silberman, Hon. Laurence H., Undersecretary of Labor, U.S. Depart-
ment of Labor :
Cases arising under the Service Contract Act where the respond-

ents were placed on the ineligible list even through the amounts

found due in underpayments of wages were recovered-------Examples of cases arising under the Walsh-Healey Public Con

tract Act where the ineligible list section was imposed al

though the amounts of back wages found due were recovered --
Letter from the Comptroller General of the United States to the

Secretary of Labor, dated September 19, 1969-------
Letter from Lawrence J. Powers, Acting Comptroller General of

the United States, to Hon. Charles Donahue, Solicitor, Depart

ment of Labor, dated September 12, 1968_--
Staats, Hon. Elmer B., Comptroller General of the United States,
General Accounting Office:
Letter from Hon. George P. Shultz, Secretary of Labor, dated
March 27, 1970----

------
Letter from Hon. J. D. Hodgson, Secretary of Labor, dated Jan-

uary 22, 1971.-.
Letter from Hon. J. D. Hodgson, Secretary of Labor, dated Feb-

ruary 17, 1971.----
Stringer, Herald E., director, National Legislative Commission, The
American Legion, letter to Chairman Thompson, dated March 30,

1971, enclosing resolution ---
Sweeney, Dave, legislative and political director; and Dan Curlee, leg-

islative counsel, International Brotherhood of Teamsters, Chauf

feurs, Warehousemen and Helpers of America, statement of -----U.S. Department of Labor, Branch of Wage Determination, manual

of policies and procedures for administration of the Service Con

tract Act-----
Webber, Clyde M., executive vice president, American Federation
of Government Employees :
"Defense Dept. Cuts 1,300 at Craig AFB in Severe State Blow,"

a newspaper article entitled---
Kelley, Roger T., Assistant Secretary of State, memorandum to

Joint Chiefs of Staff, et al. dated February 22, 1971.-.
Schultze, Charles L., director, Bureau of the Budget, circular No.

A-76 to the heads of executive departments and establishments,

dated March 3, 1966-----
Statement concerning CSC's Review of Goddard Space Flight

Center's Technical Support Services Contracts_--.
Winpisinger, William W., general vice president, International Associ-

ation of Machinists and Aerospace Workers, AFL-CIO, Statement
of --------

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TO AMEND THE SERVICE CONTRACT ACT OF 1965

TUESDAY, MARCH 30, 1971

HOUSE OF REPRESENTATIVES,
SPECIAL SUBCOMMITTEE ON LABOR,
COMMITTEE ON EDUCATION AND LABOR,

Washington, D.C. The Special Subcommittee on Labor met at 10 a.m., in room 2175, Rayburn House Office Building, Hon. Frank Thompson, Jr. (chairinan of the subcommittee) presiding.

Present: Representatives O'Hara, Hicks, and Ashbrook.

Staff members present: Hugh G. Duffy, counsel, Jeunesse M. Beaumont, subcommittee clerk; Michael J. Bernstein, minority counsel for labor.

Mr. THOMPSON. The subcommittee will be in order. Today we begin hearings on H.R. 6244 and H.R. 6245, bills to amend the Service Contract Act of 1965.

At this point in the record I will insert the text of H.R. 6244; H.R. 6245 is identical. I will also insert a staff analysis of the bill. (Text of H.R. 6244 and a summary of the bill follow :)

(H.R. 6244, 92d Cong., irst sess.] A bill to amend section 5 of the Service Contract Act of 1965 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That, subsection (a) of section 5 of the Service Contract Act of 1965 (41 U.S.C. 354(a)) is amended by striking from the second sentence thereof, the words, "Unless the Secretary otherwise recommends, no" and inserting in lieu thereof, "No".

ANALYSIS OF H.R. 6244 AND H.R. 6245_AMENDMENT TO THE SERVICE CONTRACT

ACT OF 1965

BACKGROUND

The O'Hara-McNamara Service Contract Act of 1965 established minimum labor standards protections for employees working under Government service contracts. The act covers contracts for laundry and drycleaning, custodial and janitorial work, packing and crating, guard duty, food and cafeteria service, and miscellaneous housekeeping functions.

It extended to service workers protections similar to those already enjoyed by employees working under Government construction ocntracts (the DavisBacon Act) and Government supply contracts (the Walsh-Healey Act).

Under the act, employees must be paid at least the prevailing wages and fringe benefits for similar work in their locality, and must be protected from unsafe working conditions. Prevailing wage determinations are made by the Secretary of Labor, and must in no event be less than the minimum wage specified in the Fair Labor Standards Act.

The act also provides for recovery of underpayments to employees by contractors and subsequent payment to the underpaid employees. Under section 5(a), contractors violating the acť are automatically placed on an ineligible bidders list for 3 years unless the Secretary of Labor "otherwise recommends."

PURPOSE OF THE AMENDMENT The amendment is intended to remove the Secretary of Labor's discretionary authority to relieve violators from the blacklisting provisions of the act.

CHANGES IN EXISTING LAW
Section 5(a) of Public Law 89-286 presently reads as follows:

"Sec. 5. (a) The Comptroller General is directed to distribute a list to all agencies of the Government giving the names of persons or firms that the Federal agencies or the Secretary have found to have violated this act. Unless the Secretary otherwise recommends, no contract of the United States shall be awarded to the persons or firms appearing on this list or to any firm, corporation, partnership, or association in which such persons or firms have a substantial interest until 3 years have elapsed from the date of publication of the list containing the name of such persons or firms."

H.R. 6244 and H.R. 6245 amend section 5(a) by striking from the second sentence thereof the words, "Unless the Secretary otherwise recommends, no" and inserting in lieu thereof, "No."

Mr. THOMPSON. The hearings are going to be very broad in scope so that this committee can made a general review of the Labor Department's administration of that act since 1965. The Legislative Reorganization Act of 1970 placed great emphasis on the oversight responsibility of legislative committees, and the special Subcommittee on Labor intends during this Congress to make similar reviews of other legislation within its jurisdiction.

The Service Contract Act of 1965 was sponsored by my distinguished colleague from Michigan, Mr. O'Hara, who is not here at the moment but who is expected shortly. He has a statement which will be made part of the record immediately following mine. It applies to service employees such as guards, janitors, and restaurant workers who are working under Federal service contracts, and provides that they must be paid at least the prevailing wages and fringe benefits for similar work in their locality.

The legislation is actually a sister act to the Davis-Bacon Act, which covers employees working under Federal construction contracts, and the Walsh-Healey Act, which protects employees working under government supply contracts.

We intend to probe into whether the Department of Labor is properly administering this act, and whether as written it is doing the job we intended it to do. We had hoped that this legislation would not only protect the wages and working conditions of service employees, but help to stabilize labor-management relations in that industry, and are very disturbed by recent allegations that the act is having the opposite effect.

We have invited a number of unions, contractors, and Government officials to testify before us, and will hold as many days of hearings as is necessary to get a complete and objective picture of how the act is working.

(The statement by Mr. O'Hara follows:)

STATEMENT OF HON. JAMES G. O'HARA, A REPRESENTATIVE IN CONGRESS FROM THE

STATE OF MICHIGAN In 1965, after several efforts, the Congress succeeded in enacting Public Law 89-286, known as the McNamara-O'Hara Service Contract Act. The purpose of that enactment was a very simple and straightforward one. It was already the established public policy of the United States that the massive purchasing power of the government should not be utilized to reduce or even to freeze the level of wages in the growing number of trades involved in carrying out government contracts.

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