.ARMED SERVICES BOARD OF CONTRACT APPEALS 

Appeal of -- ) 

) 

Centerra Group, LLC f/k/a The Wackenhut ) 

Services, Inc. ) 

) 

Under Contract No. NNA06CD65C ) 

APPEARANCES FOR THE APPELLANT: 

APPEARANCES FOR THE GOVERNMENT: 

ASBCA No. 61267 

Karen L. Manos, Esq. 

Melinda R. Biancuzzo, Esq. 

Gibson, Dunn & Crutcher LLP 

Washington, DC 

Scott W. Barber, Esq. 

NASA Chief Trial Attorney 

Brian Stanford, Esq. 

Senior Trial Attorney 

NASA Headquarters 

Washington, DC 

Paul H. Kim, Esq. 

Trial Attorney 

NASA Ames Research Center 

Moffett Field, CA 

OPINION BY ADMINISTRATIVE JUDGE WOODROW ON THE 

GOVERNMENT'S MOTION TO DISMISS 

Appellant Centerra Group, LLC f/k/a The Wackenhut Services, Inc. (Centerra), 

appeals from a contracting officer's final decision denying its claim for reimbursement 

of back pay and related costs arising out of a contract for fire protection services at the 

National Aeronautics and Space Administration (NASA or government) Ames 

Research Center in Moffett Field, California. 

NASA moves to dismiss the appeal for lack of jurisdiction, alleging that 

Centerra' s claim is foreclosed by the labor standards requirements of Centerra' s 

contract, which vest the U.S. Department of Labor (DOL) with exclusive jurisdiction 

to entertain disputes concerning labor standards requirements. Centerra opposes. We 

deny the government's motion. 
STATEMENT OF FACTS (SOF) FOR PURPOSES OF THE MOTION 

1. Centerra and the government are parties to Contract No. NNA06CD65C (the 

contract) (R4, tab 1 ). 

2. The contract was awarded on June 28, 2006, for fire protection and related 

services at NASA Ames Research Center in Moffett Field, California (R4, tab 1 ). 

3. The contract incorporates the standard Federal Acquisition Regulation 

(FAR) clauses applicable to a cost-reimbursement service contract, including among 

others: FAR 52.216-7, ALLOWABLE COST AND PAYMENT (DEC 2002); and· 

FAR 52.222-41, SERVICE CONTRACT ACT OF 1965, AS AMENDED (JUL 2005) (R4, tab 

1 at 29-30). 

4. FAR 52.222-4l(t) provides: 

Disputes Concerning Labor Standards. The U.S. 

Department of Labor has set forth in 29 CFR Parts 4, 6, 

and 8 procedures for resolving disputes concerning labor 

standards requirements. Such disputes shall be resolved in 

accordance with those procedures and not the Disputes 

clause of this contract. Disputes within the meaning of this 

clause include disputes between the Contractor ( or any of 

its subcontractors) and the contracting agency, the U.S. 

Department of Labor, or the employees or their 

representatives. 

5. The contract incorporates by reference FAR 52.233-1, DISPUTES (JUL 2002) 

(R4, tab 1 at 30). 

6. The contract, as initially awarded, incorporated a Collective Bargaining 

Agreement (CBA) between SecTek, Inc. and the Moffett Field Firefighters 

Association Local 1-79 (MFFA or union), dated June 3, 2005. As the successor 

contractor to SecTek, Centerra was obligated by both the DOL Wage Determination 

incorporated in the contract and FAR 52.222-4l(f) to pay its employees the wages and 

fringe benefits as set forth in the SecTek CBA. (R4, tab 2 at 3) 

7. The CBA entitles the union to arbitrate grievances (R4, tabs 1-6), and 

provides that binding arbitration is the exclusive mechanism for resolving disputes 

concerning wages and benefits under the agreement (R4, tab 2 at 9-13, tab 3 at 9-12). 

8. The relevant CBA was incorporated in the contract by Modification No. 8. 

dated July 27, 2007 (R4, tab 2); Modification No. 9, dated September 5, 2007 (R4, 

tab 3); Modification No. 44, dated August 19, 2010 (R4, tab 4); Modification No. 48, 

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dated November 24, 2010 (R4, tab 5); and Modification No. 92, dated December 16, 

2013 (R4, tab 6). 

9. On June 14, 2014, the MFF A presented a written grievance alleging that 

Centerra violated the Fair Labor Standards Act (FLSA) by failing to pay overtime 

compensation for work performed by MFF A members employed to provide fire 

protection and related services at the NASA Ames Research Center (R4, tab 7 at 1 ). 

10. The parties met, but were unable to resolve the grievance, and on June 19. 

2015, the MFF A submitted the grievance to arbitration pursuant to the CBA. The 

arbitrator concluded that the CBA's overtime provisions are contrary to the FLSA. 

(R4, tab 7 at 1, 65) 

11. On February 27, 2016, the arbitrator awarded the MFFA members 

$2,702,254 in back pay from June 19, 2010 through July 20, 2015 (the maximum 

statutory period), $2,182,732 in liquidated damages for the same period, and $238,199 

in interest (R4, tab 8 at 61 ). 

12. Centerra appealed the arbitration decision to the U.S. District Court for the 

Northern District of California. On March 31, 2017, the district court upheld the 

arbitrator's decision and awarded the MFFA members $2,702,254 in back pay; 

$2,182,732 in liquidated damages for the same period, and $238,199 in interest; 

$254,655 in attorneys' fees; and $24,271.46 in costs. The court remanded to the 

arbitrator the MFFA's request for additional attorneys' fees in an amount of 

$155,189.93 and post-award interest of $56,211.49. The total for the award, plus the 

MFFA's asserted post-award costs, is $5,613,514.88. (R4, tab 12) 

13. On April 7, 2017, Centerra submitted to the NASA contracting officer 

(CO) a certified claim forreimbursement under the contract in the amount of 

$6,184,910.13 in back pay and related costs that Centerra incurred as the result of the 

arbitrated grievance filed by the unionized firefighters working on the contract (R4, 

tab 13 ). This amount included: 

Arbitration award $5,402, 111.46 

Interest from date of award until $56,211.49 

date of district court judgment 

Attorneys' fees and costs from $155,189.93 

award until district court judgment 

Additional attorneys' fees and $364,674.82 

costs since district court judgment 

Payroll taxes upon payment of $206,722.43 

back pay 

Total Amount of Claim $6,184,910.13 

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14. By letter dated May 22, 2017, the CO issued a written determination 

denying Centerra' s certified claim. The letter stated, in part: 

(R4, tab 14) 

It is my Determination, as the Contracting Officer, that it is 

premature for Centerra to seek reimbursement from the 

United States Government for any such costs and penalties 

prior to Centerra obtaining a final determination from the 

U.S. Department of Labor, and, concomitantly, it would be 

premature for me to evaluate and determine the underlying 

merits of this claims, or lack thereof. Consequently, this 

claim is denied. 

15. On August 2, 2017, appellant timely filed a notice of appeal. 

16. DOL has not been asked to render a final determination in connection with 

the Union's grievance. 

DECISION 

The government moves for dismissal of appellant's claim for reimbursement of 

back pay on the grounds that it falls within the exclusive jurisdiction of the DOL. 

Pursuant to FAR 52.222-41 (t), DOL, not the Board, possesses jurisdiction to entertain 

"disputes concerning labor standards requirements." According to the government, 

labor standards for federal service contracts include matters involving overtime 

compensation for service employees (gov't br. at 2 (citing 29 C.F.R. § 4.180)). 

Therefore, pursuant to FAR 52.222-4 l(t), appellant's claim falls within DOL's 

exclusive jurisdiction and this Board is without jurisdiction to entertain appellant's 

claim under the contract's Disputes clause. 

In response, Centerra contends that the dispute before the Board is not over the labor 

standards requirements applicable to the contract, but over the government's obligation to 

reimburse appellant for costs -incurred pursuant to an arbitration award under a CBA with 

its unionized employees. According to appellant, any dispute involving "labor standards 

requirements" already has been resolved in favor of the unionized employees, and the only 

remaining question is whether NASA must reimburse appellant for the costs it has incurred 

pursuant to the arbitration award (app. opp'n at 5). In a sur-reply brief filed after briefing 

closed, appellant offers an alternative argument, contending that the dispute concerning 

overtime pay is not a "dispute[] concerning labor standards requirements" within the scope 

of FAR 52.222-4l(t). 

We hold that we possess jurisdiction to entertain the appeal. 

4 
STANDARD OF REVIEW 

We review the government's motion to dismiss for lack of jurisdiction pursuant 

to the standards of FED. R. CIV. P. 12(b)(l). L-3 Communications Integrated Sys., l.P., 

ASBCA Nos. 60713, 60716, 17-1 BCA 136,865 at 179,624 (applying Rule 12(b)(l) 

because Board may look to Federal Rules of Civil Procedure for guidance where 

Board's rules are silent). 

When a motion to dismiss pursuant to FED. R. CIV. P. l 2(b )(1) denies or 

controverts allegations of jurisdiction, only uncontroverted factual allegations are 

accepted as true for purposes of the motion, and other facts underlying the 

jurisdictional allegations are subject to fact-finding based on the Board's review of the 

record. Cedars-Sinai Medical Center v. Watkins, 11 F.3d 1573, 1583-84 (Fed. Cir. 

1993); CCIE & Co., ASBCA Nos. 58355, 59008, 14-1BCA135,700 at 174,816. 

Centerra, as the proponent of the Board's jurisdiction, bears the burden of 

proving the Board's subject matter jurisdiction by a preponderance of the evidence. 

Reynolds v. Army & Air Force Exchange Service, 846 F.2d 746, 748 (Fed. Cir. 1988); 

United Healthcare Partners, Inc., ASBCA No. 58123, 13 BCA 135,277 at 173,156. 

For the Board to possess jurisdiction under the Contract Disputes Act (CDA) 

41 U.S.C. §§ 7101-7109, Centerra must establish that: (1) it has submitted in writing 

a valid claim to the CO; and, (2) the CO has issued a final decision or deemed denial. 

K-Con Bldg. Sys., Inc., 778 F.3d 1000, 1005 (Fed. Cir. 2015); 41 U.S.C. § 7103; ECC 

CENTCOMConstructors, LLC, ASBCA No. 60647, 18-1BCA137,133. 

DISCUSSION 

This appeal does not involve a "dispute[] concerning labor standards 

requirements" as that term is used in FAR 52.222-4l(t). That is because the 

underlying labor dispute - which concerns entitlement to overtime pay under the CBA 

- is not subject to the procedures set forth at 29 C.F .R. parts 4, 6, and 8 and is outside 

the scope of FAR 52.222-4l(t). Moreover, even ifFAR 52.222-4l(t) did apply, there 

is no basis to conclude that the Board's jurisdiction is premature, because the 

underlying labor dispute already has been resolved pursuant to the terms of the CBA. 

In the absence of an underlying labor dispute, FAR 52.222-41 (t) is not implicated and 

any remaining dispute (including entitlement to reimbursement for allowable costs 

pursuant to FAR 52.216-7) is subject to the contract's Disputes clause. 

I. FAR 52.222-4 l(t) Does Not Apply to this Appeal 

The contract in this appeal contains various clauses that required Centerra to 

comply with the Service Contract Act (SCA), 41 U.S.C. §§ 6701-6707 including in 

particular FAR 52.222-41, which is at the center of the government's motion. Pursuant 

to the SCA, DOL sets the prevailing wages and fringe benefits that must be paid 

5 
non-exempt service workers on U.S. Government service contracts such as the contract at 

issue in these appeals. 41 U.S.C. § 6702(a) (defining contracts subject to the SCA). 

CBAs negotiated by a contractor and accepted by DOL take the place of any prevailing 

wage determination issued by DOL. See 41 U.S.C. § 6703(a)(l) (wages are set by CBA 

in covered contracts). Thus, the economic terms and conditions of the CB As, including 

those provisions that regulate wages and fringe benefits, become the wage determination 

under the SCA. See 41 U.S.C. §§ 6703(a)(l), (a)(2), 6707(c); also 29 C.F.R. § 4.163(a). 

NASA contends that overtime pay falls within the definition of "wages and 

fringe benefits" in the SCA and is, therefore, within the scope off AR 52.222-4l(t) 

(gov't br. at 2 (citing 29 C.F.R. § 4.180))*. Centerra, in its sur-reply, disputes this 

conclusion, arguing that the full text of 29 C.F .R. § 4.180 makes clear that overtime 

pay is not covered by the SCA. According to Centerra, the union's grievance 

involving the failure to pay overtime hours is based on an alleged violation of the 

FLSA and is not subject to the procedures of the rules implementing the SCA at 

29 C.F.R. parts 4, 6, or 8. Thus, Centerra reasons, FAR 52.222-4I(t) is not applicable. 

(App. sur-reply br. at 2) 

We agree with Centerra's interpretation of 29 C.F.R. § 4.180. The opening 

sentence of§ 4.180 states that the "[SCA] does not provide for compensation of 

covered employees at premium rates for overtime hours of work." The remainder of 

§ 4.180 addresses how fringe benefits are to be treated in calculating overtime pay 

pursuant to the Fair Labor Standards Act (FLSA). This comports with the language of 

the SCA itself, which focuses on the minimum wages and fringe benefits afforded 

service workers under federal contracts. The sole mention of overtime pay in the SCA 

addresses the exclusion of fringe benefits from the calculation of overtime pay, not the 

entitlement to overtime pay. 41 U.S.C. § 6707(e). 

It is telling that the specific regulatory provisions referenced in FAR 52.222-41 (t) 

do not address overtime wages. Part 4 of 29 C.F .R. addresses labor standards for federal 

service contracts, while parts 6 and 8 set forth the rules of practice for administrative 

proceedings and administrative review boards. Nothing in parts 4, 6, and 8 of 29 C.F .R. 

addresses entitlement to overtime pay, nor do they create a remedy to enforce a claim for 

overtime pay. Instead, as set forth in 29 C.F.R. § 4.180, "other Federal laws may require 

such compensation to be paid to employees working on or in connection with contracts 

subject to the [SCA]." 

Therefore, because the unionized employees have no administrative remedy to 

enforce their claim for overtime pay under the SCA, and FAR 52.222-41 (t) only 

* Note that 29 C.F .R. part 4 is explicitly made applicable to labor disputes in the 

contract under the terms of FAR 52.222-4l(t). 

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precludes us from considering disputes that are under the ambit of the SCA, this 

provision has no applicability to the underlying labor dispute in this appeal. 

II. Even if FAR 52.222-4l(t) Applied, this Appeal is Not Premature 

Because the employees' overtime pay dispute has been fully and finally 

resolved pursuant to the arbitration provisions of the CBA, there is no need for a final 

DOL ruling on overtime pay. The CBA between NASA and the MFF A is 

incorporated into the contract at issue in this appeal (SOF ~ 8). The CBA provides that 

binding arbitration is the exclusive mechanism for resolving disputes concerning 

wages and benefits under the agreement (SOF ,i 7). Here, the binding arbitration has 

concluded and the district court upheld the arbitrator's decision and awarded the 

MFFA members back pay (SOF ,i 12). 

The union employees' overtime dispute has been finally resolved pursuant to the 

terms of the CBA and there is no remaining role for DOL. In the absence of an 

underlying labor dispute, FAR 52.222-4l(t) is not implicated and any remaining dispute 

(including entitlement to reimbursement for allowable costs pursuant to FAR 52.216-7) 

is subject to the contract's Disputes clause. 

Burnside-Ott Aviation Training Center, Inc. v. United States, 985 F.2d 1574 

(Fed. Cir. 1993 ), supports this conclusion. There the Federal Circuit held that CDA 

jurisdiction exists when "a dispute centers on the parties' mutual contract rights and 

obligations, ... even though matters reserved to and decided exclusively by the [DOL] 

are part of the factual predicate." 985 F.2d at 1580 (quoting Emerald Maintenance 

Inc., ASBCA Nos. 36628, 36632, 88-3 BCA ,i 21,103 at 106,532); see also Aleman 

Food Servs. v. United States, 25 Cl. Ct. 201,208 (1992) (stating that the claims court 

has jurisdiction where resolution of dispute requires examination of contract 

provisions and the DOL's determinations form only part of the factual predicate). 

In Burnside-Ott, the contractor challenged the DOL' s wage rate determination 

and received a final determination from the Secretary of Labor. After accepting the 

determination and paying its workers the higher wages, the contractor sought 

reimbursement for those wages as an equitable adjustment to its contract. The court 

held that the DOL's ruling formed only part of the factual predicate of the contractor's 

claims and that the claims court possessed jurisdiction to determine whether the 

contractor was entitled to reimbursement pursuant to the contract. 985 F .2d at 1580. 

This appeal is factually similar. Here, Centerra challenged the arbitrator's 

award and received a final ruling in federal district court enforcing the award. As in 

Burnside-Ott, there is nothing left for DOL to resolve. Indeed, as in Burnside-Ott, the 

underlying labor dispute forms only part of the factual predicate for Centerra's claim -

the remaining factual issues concern whether Centerra' s costs can be recovered as 

allowable costs under the terms of the contract. 

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NASA attempts to distinguish Burnside-Ott on the grounds that this case lacks 

the factual predicate of a final DOL ruling (gov't reply br. at 2-3). However, as we 

previously explained, the final arbitration ruling on overtime compensation is 

equivalent to a final ruling from DOL, because DOL has approved the CBA and the 

dispute resolution mechanism incorporated into the CBA. 

For the same reason, NASA's reliance on MMC Construction, Inc./Rocliford Corp .. 

JV. & Aleutian Constrs. JV., and Hunt Building, Co. fails. MMC Construction stands for 

the uncontroversial proposition that the Board possesses jurisdiction only after DOL ·s 

wage determination administrative process has been completed. ASBCA No. 50863 et al .. 

99-1 BCA 130,322 at 149,954. Hunt Building, like MMC Construction, holds that there 

must be a final DOL ruling on labor standards before the Board possesses jurisdiction. 

Hunt Bldg., ASBCA No. 55157, 06-1BCA133,213 at 164,598. 

In this appeal, because Centerra does not seek a wage determination or other 

ruling on labor standards, there is no relevant DOL administrative process to complete 

and, tellingly, NASA has identified nothing that it is waiting for. 

CONCLUSION 

For these reasons, NASA's motion to dismiss is denied. 

Dated: November 16, 2018 

I concur 

RICHARD SHACKLEFORD 

Administrative Judge 

Acting Chairman 

Armed Services Board 

of Contract Appeals 

8 

Administrative Judge 

Armed Services Board 

of Contract Appeals 

I concur 

J. REID PROUTY 

Administrative Judge 

Vice Chairman 

Armed Services Board 

of Contract Appeals 
I certify that the foregoing is a true copy of the Opinion and Decision of the 

Armed Services Board of Contract Appeals in ASBCA No. 61267, Appeal of Centerra 

Group, LLC f/k/a The Wackenhut Services, Inc., rendered in conformance with the 

Board's Charter. 

Dated: 

9 

JEFFREYD. GARDIN 

Recorder, Armed Services 

Board of Contract Appeals