Montana Attorney General Opinion 15-397

Opinion No. 397 Highwa)'s-ContJ"lldol's-Labor-J<Jight Hom' Day-\Vages-Penalty for Violation. HliJLD : Section 3, Chapter 102. La:,'s of 11131, provides for a "penalty" anll does not require a showing of ac- tual damage even though the wordin" "liquidated damages" is used in con": lIection therewith. The penalty ma~' not be avoided nor the offense cured by subsequent pay- Illent in fnII for time employees \vere required to work in violation of Chap- tl'r 102, Laws of 1!)3l. It is the duty of the contractor to see that his sub-contractors a re re- sponsible and that they carry out the t('rms of his contract; he may not enl de responsibility therefor. November 25. 1933 \Ve have your request for an opinion (!11 the following facts: OPIXIOXS OJ!' THE] ATTOHXEY GEXERAL 277 "Aftel' the completion of the pro- ject our engineer began to receh'e complaints from n number of the la- horers who had been employed on the work that they had not been paid in full. Upon investigation we found that these men had been shown on the payrolls for thirty hours per week at the proper rate per hour. 'Ve found however, tha t in many cases they hlill worked mOl'e than thirty hours per week, with the understanding he, tween themselves, the suhcontractor alld his time-keeper and upparently wilh the knowledge of the contrac- tors' superintendent, that they would bp paid the bulance due them ut n later date. "The reason for the puyment of onl~' a part of the time actually worked by these men was that the rules of the emergency relief high, wuy work, us incorporated in the COIl- ,tmct, were that no man was to be permitted to work o\'er thirty llOurs per week. III order to a void 'trouhlf'. therefore, the suhcolltraetor prepared payrolls showing these men at thirty hours per week. only puid them 'in ac- cordance with such paYl'Olls [nill fur- nished our engineer with certified copies of the pa:\'rolls: The superin- tendent, who was on the job through- out most of the construction work. ndmits that he knew this practice was going on. The senior member Ilf the firm of contractors. claims thut he knew nothing about 'this practice. ulthough his sl-qmrintendent claims thut he wus told of it. "Since' our investigation was matle a supplementary payroll has heen prepared. showing ull of the o\'ertime worked 'by these employees and the c(lntractors hu ye paid these emplo~'­ ees in full. "The question upon which the Com- mission would like your opinion is whether or not the contrnctor in this case has violated Chapter l02 of the Stututes enactcd by the 22ml Sessioll of the Legislature in not puying the slundard prevailing rate of wages. Paragraph 3 of Chapter l02 makes it mandatory upon the Commissioll, to withhold $500.00 as liquidated damages, in cases where this law is "iolated. In this case the rate of wages was fLxed in the contract and the proper wugc scale was shown on the payrolls. The question, there- fore, is whether the contractor yio- Inted the law in attempting to pay the men for a smaller numher of hours than they actually worked, showing tlleir rate per hour as fixed by the contract, but actually puying an ay- ('ruge rate per hour for the whole numher of honrs worked which was I(~ss than the premiling rate of wuges at the county seat: also, if the con- tractor ,ioluted the law in attempt- ing to pay the lllen for fewer num her of hours than were actually worked, is he still guilty after ha,ing paid snch employees in full, when request- e(1 to do so by our engineer," CONCLUSIOXS In my opinion this wus an inexcus- ahle breach of good faith and a spe- cific "iolation of Chapter 102, Lltws of H)3l. A plime purpose of the act is to compel payment of wnges at the stan- dard prevailing rate. The fuct that ~ection 3 refers to the penalty as "li- quidated damages" does not, in my (.pinion, require that some actual dum- B)!,e to the state be shown. The so- called liquidll ted damages is not intend- ed to compensate, but is intended as a penalty. The marginal notes in the ~ession Laws refer to it as a "pen- alty." In the title, the Iluthor (If the bill uses the word "forfeiture." Tuken as a whole. the hill compels the be- lief that a penalty is intended. I cun see no reason why the penalty should not be enforced in this instance, l-:esides punishing the wilful offender, it will serve notiee to others that this law, designed to protect the agreed wages of lubor. must not be trifled with. In this case there is more than a Illere attempt to "iolate the law, The (,ffense actually was committed. The fact that later, upon complaint and after investigation, the contractors were compelled to pay for the addi- tional time does not make it less an aduul offense. ~'o contend otherwise wlIuld be no more logical than to con- tell(1 that a thief is absol\'ed of his guilt simply because he has been ap- prehended and compelled to disgorge the profits of his theft. And what is the defellse of the COIl- tractors'! They state it was done by 278 OPINIOXS OF THE ATTOHXEY GE:-;EHAL a suhcoutractor as a suhterfuge uutler the cloak of which to evade the 30 hour proYision of their contract. The regulations of the United States Government, which furni~hed the nIGney for the work, and the express terms of the contract, require that no man shall work more than 30 honrs per week. This requirement is part of a grea t program deSigned to decrease unemployment by spreading the work among more men thus crea ting more jobs. Our nation is in the throes of a great economic crisis; the creation of employment is an integral factor iu the IH'ogram designed to pull us through this crisis. Patriotic emplo~'­ er~ throughont the nation, many of them facing bankruptcy, uncomplain- ingly suffer losses in order to aid this program. But the contractors here inyoh'ed, aware of this crisis, aware of thi~ program, aware of the regulations of the Government, having bid upon the wGrk with this knowledge in mind, lwying solemnly promised to assist iu this program, tolerated a conspiracy surreptitiously to evade the 30 hour proYision, and have thus done their little share to defeat this great pro- gram. In the accomplishment of this purpose they permitted sworn payrolls tu be filed, falsely stating the number of hours worked by each man. 'l'he defense com'icts the contract- ors of permitting misrepresentatiun, bad faith and an inexcusahle viola- tion of a specific provision of the con- tract. No court will permit them to hide hehind and to claim the benef,it of their wrong. H is said that the offense has been cured, that the men eventually receiyetl their full wages, that the state lost no money, that the United States lost no money, that no one has been harmed. Conceding the premises, is it true that no one has heen harmed? As heretofore pointed out, .the 30 hour ,veek was designed to decrease unem- ployment by creating more jobs. Five -ten-twenty, perhaps more men (I have not seen the figures) ha"e been ueprived of employment by reason of this hreach of faith. These men will go forever unidentified, but of a cer- tainty they exist. Some of them now may be living in the jungles, some beg- ging on the streets, some subsisting on organized relief, some committing rob- bery that their families may eat. Are uot these men harmed by failure to keep a solemn pact intended to create jobs for them'! It not the public zeal affected by the pauperism of these men and national recovery retarded, even though inapprecia,bly? And, if this thing is permitted to go unpun- ished and for that reason to repeat and Illultiply, will it not ultimately de- ft'a t the whole program '! The senior member of the firm states this was done without his knowl- edge. Howe"er, hi;; superilltendelit ad- mits knowledge and ~tates tha t the selJior member kne,,, also. "Whether or not he did is immaterial. It was his duty to see that his contract was car- ried out, and if he let his work to an iITespunsible sub-contractor, he may not evade responsihility for the sub- contractor's defaults. advise that the penalty be en- forced. Opinion No, 398 Public Officers - Count,y Officers- Deputies-County Employees -Vacations-County Commissioners. HELD: County officers anel (lepu- ties, whose offices and salaries are de- termined and fixed hy law, may take I'easonable yacations with pay and the county commissioners ha,'e no author- ity to diminish their salaries. County comniissioners ma~', by ex- press contract, or by reason of contract implied from custom, or by rules es-. tablished by them, allow reasonable yacations with pay to deputies and em- ployees whose positions and salaries a re determined and fixed by them. November 27, 1933 You ha "e submitted the following questions for my opinion: ·'First. Does an elected county officer, or his deputy or deputies, appointed by au- thority of law and working on a salary, have a right to ,take a vacation on pay while employed by the county? Sec- ond. Does a clerk or other employee. other than a county official elected by law, or a deputy or deputies as aboye mentioned, have a right to take a va- eation on pay while employed or work- ing for the county?"