.ARMED SERVICES BOARD OF CONTRACT APPEALS Appeal of

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

Services, Inc. ) ) Under ContractNo. NNA06CD65C ) APPEARANCES FORTHE APPELLANT:

APPEARANCES FORTHE GOVERNMENT: ASBCA No. 61267

Karen L. Manos, Esq. Melinda R. Biancuzzo, Esq.

Gibson, Dunn & CrutcherLLP Washington, DC Scott W. Barber, Esq.

NASA ChiefTrial 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 BYADMINISTRATIVE JUDGE WOODROW ON THE GOVERNMENT'S MOTIONTO 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 ofbackpay and related costs arising out ofa contract for fire protection services at the National Aeronautics and Space Administration (NASA or government) Ames Research Center in MoffettField, California. NASA moves to dismiss the appeal for lack of jurisdiction, alleging that Centerra's claim is foreclosed bythe labor standards requirements ofCenterra's contract, which vest the U.S. Department ofLabor (DOL) with exclusivejurisdiction to entertain disputes concerning labor standards requirements. Centerra opposes. We deny the government's motion.STATEMENT OF FACTS (SOF) FORPURPOSES 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 COSTAND PAYMENT (DEC 2002); and· FAR 52.222-41, SERVICE CONTRACT ACT OF 1965,AS AMENDED (JUL 2005) (R4, tab 1at 29-30). 4. FAR 52.222-4l(t)provides: Disputes ConcerningLaborStandards. The U.S. Department ofLaborhas set forth in 29 CFRParts 4, 6, and 8procedures for resolving disputes concerning labor standards requirements. Such disputes shall be resolved in accordance with those procedures and not the Disputes clause ofthis contract. Disputes within the meaning ofthis clause include disputes betweenthe Contractor (or any of its subcontractors) and the contracting agency, the U.S. Department ofLabor, orthe employees ortheir representatives. 5. The contract incorporates by reference FAR52.233-1, DISPUTES (JUL 2002) (R4, tab 1at 30).
6. The contract, as initially awarded, incorporated a Collective Bargaining Agreement (CBA) between SecTek, Inc. and the MoffettField Firefighters Association Local 1-79 (MFFA or union), dated June 3, 2005. As the successor contractorto SecTek, Centerrawas obligatedby both the DOL Wage Determination incorporated in the contract andFAR52.222-4l(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 andbenefits underthe agreement (R4, tab 2 at 9-13, tab 3 at 9-12). 8. The relevant CBA was incorporated in the contractby 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, 2dated November24, 2010 (R4, tab 5); and Modification No. 92, dated December 16, 2013 (R4,tab 6).
9. On June 14, 2014, the MFFA presented a written grievance alleging that Centerraviolated the FairLabor Standards Act (FLSA) by failing to pay overtime compensation for work performed by MFFA 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 MFFA submitted the grievance to arbitration pursuant to the CBA. The arbitrator concluded thatthe CBA's overtime provisions are contrary to the FLSA. (R4, tab 7 at 1, 65) 11. OnFebruary 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 ofCalifornia. On March 31, 2017, the district courtupheld the arbitrator's decision and awarded the MFFA members $2,702,254 in backpay; $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 courtremanded to the arbitratorthe MFFA'srequest 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 underthe contract in the amount of $6,184,910.13 in backpay and related costs that Centerra incurred as the result ofthe 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 ofaward until $56,211.49 date ofdistrict courtjudgment Attorneys' fees and costs from $155,189.93 award until district courtjudgment Additional attorneys' fees and $364,674.82 costs since district courtjudgment Payroll taxes upon payment of $206,722.43 back pay Total Amount ofClaim $6,184,910.13

314. 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 seekreimbursement from the United States Government for any such costs and penalties prior to Centerra obtaining a final determination from the U.S. Department ofLabor, and, concomitantly, it would be premature for me to evaluate and determine the underlying merits ofthis claims, or lack thereof. Consequently, this claim is denied.

15. On August 2, 2017, appellant timely filed a notice ofappeal. 16. DOL has not been asked to render a final determination in connection with the Union's grievance. DECISION The government moves for dismissal ofappellant's claim for reimbursement of backpay on the grounds that it falls within the exclusivejurisdiction ofthe DOL. Pursuantto FAR 52.222-41(t), DOL, not the Board, possessesjurisdictionto 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'tbr. at 2 (citing 29 C.F.R. §4.180)). Therefore, pursuantto FAR 52.222-4l(t), appellant's claim falls within DOL's exclusivejurisdiction andthis Board is withoutjurisdictionto entertain appellant's claimunder the contract's Disputes clause.
In response, Centerra contends thatthe dispute before the Board is not overthe 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 ofthe unionized employees, and the only remaining question is whetherNASA must reimburse appellant for the costs it has incurred pursuant to the arbitration award (app. opp'n at 5). In a sur-reply brieffiled 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 ofFAR 52.222-4l(t).
We hold that we possessjurisdictionto entertain the appeal.



### 4STANDARD OF REVIEW
We review the government's motion to dismiss for lack of jurisdiction pursuant to the standards ofFED. R. CIV. P. 12(b)(l). L-3 Communications IntegratedSys., 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 ofCivil Procedure for guidance where Board'srules are silent). When a motion to dismiss pursuantto FED. R. CIV. P. l2(b)(1) denies or controverts allegations of jurisdiction, only uncontroverted factual allegations are accepted as true for purposes ofthe motion, and other facts underlying the jurisdictional allegations are subject to fact-finding based on the Board's review ofthe 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 ofthe Board'sjurisdiction, bears the burden of provingthe Board's subject matterjurisdictionby a preponderance ofthe evidence. Reynolds v. Army &AirForce Exchange Service, 846 F.2d 746, 748 (Fed. Cir. 1988); UnitedHealthcare Partners, Inc., ASBCANo. 58123, 13 BCA 135,277 at 173,156. Forthe Boardtopossessjurisdictionunderthe ContractDisputes 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, ASBCANo. 60647, 18-1BCA137,133. DISCUSSION This appeal does not involve a "dispute[] concerning labor standards requirements" as thatterm is used in FAR 52.222-4l(t). That is because the underlying labor dispute

- which concerns entitlementto overtime pay under the CBA

- is not subjectto the procedures set forth at 29 C.F.R. parts 4, 6, and 8and is outside the scope ofFAR 52.222-4l(t). Moreover, even ifFAR 52.222-4l(t) did apply, there is no basis to conclude that the Board'sjurisdiction is premature, because the underlying labor dispute already has beenresolved pursuantto the terms ofthe CBA. In the absence ofan underlying labor dispute, FAR 52.222-41(t) is not implicated and any remaining dispute (including entitlementtoreimbursement for allowable costs pursuantto FAR 52.216-7) is subjectto the contract's Disputes clause.
I. FAR 52.222-4l(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 particularFAR 52.222-41, which is at the center ofthe government's motion. Pursuant to the SCA, DOL sets the prevailing wages and fringe benefits that must be paid 5non-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 subjectto the SCA). CBAs negotiated by a contractor and accepted by DOL take the place ofany 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 ofthe CBAs, including those provisions that regulate wages and fringe benefits, become the wage determination underthe SCA. See 41 U.S.C. §§ 6703(a)(l), (a)(2), 6707(c); also 29 C.F.R. §4.163(a). NASA contends that overtimepay falls within the definition of"wages and fringe benefits" in the SCA and is, therefore, within the scope offAR 52.222-4l(t) (gov'tbr. at 2 (citing 29 C.F.R. §4.180))*. Centerra, in its sur-reply, disputes this conclusion, arguing that the full text of29 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 ofthe FLSA and is not subject to the procedures ofthe 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 of29 C.F.R. §4.180. The opening sentence of§ 4.180 states that the "[SCA] does notprovide for compensation of covered employees atpremium rates for overtime hours ofwork." The remainder of §4.180 addresses how fringe benefits are to be treated in calculating overtime pay pursuant to the FairLabor 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 ofovertime pay in the SCA addresses the exclusion offringe benefits from the calculation ofovertime pay, not the entitlement to overtimepay. 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 of29 C.F.R. addresses labor standards for federal service contracts, while parts 6 and 8 set forth the rules ofpractice for administrative proceedings and administrative review boards. Nothing in parts 4, 6, and 8 of29 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, "otherFederal 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 overtimepay underthe 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 underthe terms ofFAR 52.222-4l(t).

6precludes us from considering disputes that are underthe ambit ofthe SCA, this provision has no applicability to the underlying labor dispute in this appeal.
II. Even ifFAR 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 ofthe CBA, there is no need for a final DOL ruling on overtime pay. The CBA between NASA and the MFFA 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 backpay (SOF 

### ,i 12). The union employees' overtime dispute has been finally resolved pursuant to the terms ofthe CBA andthere is no remaining role for DOL. In the absence ofan underlying labor dispute, FAR 52.222-4l(t) is not implicated and any remaining dispute (including entitlementto reimbursement for allowable costs pursuant to FAR 52.216-7) is subject to the contract's Disputes clause. Burnside-OttAviation Training Center, Inc. v. UnitedStates, 985 F.2d 1574 (Fed. Cir. 1993), supports this conclusion. There the Federal Circuit held that CDA jurisdiction exists when "adispute centers on the parties' mutual contractrights and obligations,

...even though matters reserved to and decided exclusively by the [DOL] are part ofthe factual predicate." 985 F.2d at 1580 (quoting EmeraldMaintenance Inc., ASBCANos. 36628, 36632, 88-3 BCA ,i 21,103 at 106,532); see alsoAleman FoodServs. v. UnitedStates, 25 Cl. Ct. 201,208 (1992) (stating thatthe claims court hasjurisdictionwhere resolution ofdispute requires examination ofcontract provisions and the DOL's determinations form only part ofthe factual predicate).
InBurnside-Ott, the contractor challenged the DOL's wage rate determination and received a final determination from the Secretary ofLabor. After accepting the determination and paying its workers the higherwages, the contractor sought reimbursement for those wages as an equitable adjustmentto its contract. The court heldthat the DOL'sruling formed only part ofthe factual predicate ofthe contractor's claims and thatthe claims courtpossessedjurisdictionto determine whetherthe contractorwas entitled to reimbursement pursuantto 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 ofthe factual predicate for Centerra's claim

- the remaining factual issues concern whether Centerra's costs can be recovered as allowable costs underthe terms ofthe contract. 7NASA attempts to distinguishBurnside-Ott on the grounds that this case lacks the factual predicate ofa final DOL ruling (gov'treply br. at 2-3). However, as we previously explained, the final arbitration ruling on overtime compensation is equivalentto a final ruling from DOL, because DOLhas 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 HuntBuilding, Co. fails. MMC Construction stands for the uncontroversial proposition that the Board possessesjurisdiction 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 Boardpossessesjurisdiction. 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
Forthese reasons, NASA's motion to dismiss is denied. Dated: November 16, 2018

I concur

RICHARD SHACKLEFORD Administrative Judge Acting Chairman Armed Services Board ofContract Appeals

8 Administrative Judge Armed Services Board ofContract Appeals
I concur

J. REID PROUTY Administrative Judge Vice Chairman Armed Services Board ofContractAppealsI certify that the foregoing is atrue copy ofthe Opinion and Decision ofthe Armed Services Board ofContract Appeals in ASBCA No. 61267, Appeal ofCenterra 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 ofContract Appeals