United States District Court, District of Columbia
ROSEMARIE DOW, et al. Plaintiffs,
HC2, INC., et al., Defendants.
P. Mehta United States District Court Judge
Rosemarie Dow, Sherry Beshay, Kamaldeep Kohli, Kathy Ludunge,
and Evan Stephens bring this action to recover unpaid wages
from Defendants HC2, Inc., doing business as Hire Counsel,
and PAE Government Services, Inc. (“PAE”).
According to the Complaint, each Plaintiff was hired by
Defendants to perform work on a long-term document review
project for the United States Department of Justice
(“DOJ”). Complaint, ECF No. 1 [hereinafter
Compl.], ¶ 19. Plaintiffs worked for Defendants pursuant
to a subcontract between Hire Counsel and PAE. Id.
¶ 20. The prime contract was between PAE and the DOJ.
Id. The prime contract identified various
“Labor Categories, ” which corresponded to
certain “Occupation Codes.” Id. ¶
21. The Occupation Codes are set forth in the Register of
Wage Determinations Under the Service Contract Act, published
by the Department of Labor's Division of Wage
Determinations. Id. The Register establishes
different wage requirements for each Occupation Code. Those
requirements were incorporated by reference into the prime
contract with the DOJ, the subcontract between Hire Counsel
and PAE, and each individual Plaintiff's employment and
compensation agreement. Id. ¶ 23. Pursuant to
the contracts, Defendants agreed to pay Plaintiffs in
accordance with the wage requirements of the Register and to
pay the wages that corresponded to each Plaintiff's
Occupation Code. Id. ¶¶ 24, 27.
allege, however, that “[d]uring the relevant period,
Defendants intentionally misclassified Plaintiffs as
performing job duties of a lesser skill and classification
than Plaintiffs actually performed.” Id.
¶ 28. The Complaint identifies in detail the work
performed by Plaintiffs, the classifications Plaintiffs
believe they were entitled to, and the amount of backpay and
overtime wages they claim is due to them. Id.
¶¶ 34-58. “By misclassifying [them], ”
Plaintiffs contend, “Defendants wrongly and
intentionally paid Plaintiffs lower hourly rates
corresponding with the false and less sophisticated
Occupational Code classifications.” Id. ¶
29. Accordingly, “Defendants now owe Plaintiffs unpaid
wages for all hours worked equal to the difference between
the lower hourly rate Defendants paid Plaintiffs and the
hourly rate Defendants were contractually obligated to pay
Plaintiffs for the proper Occupational Code and
classification for the actual work each Plaintiff
performed.” Id. ¶ 30.
March 25, 2019, Plaintiffs filed suit in this court, seeking
damages for violations of the District of Columbia Wage
Payment and Wage Collection Act (“DCWPA”) and the
Federal Fair Labor Standards Act (“FLSA”). Compl.
¶¶ 59-76. Defendants move to dismiss the Complaint
under Federal Rule of Civil Procedure 12(b)(6) for failure to
state a claim, arguing that administrative relief through the
Department of Labor is Plaintiffs' exclusive remedy. More
specifically, Defendants assert that the court “cannot
grant the requested relief without deciding whether
[Plaintiffs] were classified in the correct labor categories
under the [Service Contract Act], and Congress has vested the
Secretary of Labor with exclusive authority to make those
determinations.” Defs.' Mem. in Supp. of Defs'
Mot. to Dismiss, ECF No. 5-1 [hereinafter Defs.' Mot.],
reasons that follow, the court agrees with Defendants and
grants their Motion to Dismiss.
survive a motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). A claim is plausible on its face when “the
plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable
for the misconduct alleged.” Id. (citing
Twombly, 550 U.S. at 556). At the motion to dismiss
stage, the court must accept as true a plaintiff's
well-pleaded factual contentions and draw all reasonable
inferences, but it need not accept thread-bare recitals of
the elements of standing or legal conclusions disguised as
factual allegations. See Arpaio v. Obama, 797 F.3d
11, 19 (D.C. Cir. 2015). Factual allegations are not required
to be “detailed, ” but they must be more than
“an unadorned, the defendant-unlawfully-harmed-me
accusation.” Iqbal, 556 U.S. at 678 (citing
Twombly, 550 U.S. at 557).
sole issue before the court is whether Plaintiffs' claims
are properly raised here, or whether instead they should be
submitted for administrative review before the Department of
Labor. The McNamara-O'Hara Service Contract Act
(“SCA”) sets forth labor standards applicable to
service contracts with the federal government. See
41 U.S.C. §§ 6701-6707. The SCA requires such
contracts “to contain minimum wage provisions for each
class of service employees in the performance of the
contract.” Danielsen v. Burnside-Ott Aviation
Training Center, Inc., 941 F.2d 1220, 1223
(D.C. Cir. 1991). “[T]he statute requires the Secretary
of Labor to make a determination of the applicable minimum
wages and fringe benefits based on prevailing rates in the
locality of the performance of the contract.”
Id. The regulations adopted pursuant to the SCA
contain an exhaustive scheme for “interested
parties” to seek administrative reconsideration of wage
determinations. See id.
argue that the D.C. Circuit's decision in
Danielsen controls the outcome of this case.
Defs.' Mot. at 2, 6-8. In Danielsen, the D.C.
Circuit addressed whether violations of the SCA could
“give rise to a private civil action under [the
Racketeer Influenced and Corrupt Organizations Act
(“RICO”)] in addition to the remedies provided
under the SCA, ” and held that they could not. 941 F.2d
at 1227. There, employees of service corporations contracting
with the United States brought claims under RICO, challenging
their classifications as “technicians” in several
contracts and arguing that they were due backpay for any
misclassifications. Id. at 1224- 26. The circuit
court held that “the implication of a private right
under the SCA would undercut the specific remedy prescribed
by Congress.” Id. at 1228 (citing
Miscellaneous Service Workers, Local 427 v. Philco-Ford
Corp., 661 F.2d 776, 781 (9th Cir. 1981)). The
Department of Labor alone could decide, in the first
instance, whether the classifications were proper. See
over a decade after deciding Danielsen, the D.C.
Circuit reaffirmed its holding, albeit in a different
context, in C&E Services, Inc. of Washington v.
District of Columbia Water and Sewer Authority. In
C&E Services, the plaintiff, a losing bidder for
a District of Columbia government contract, challenged the
city's refusal to award it the contract under the Due
Process Clause and the SCA.310 F.3d 197, 198 (D.C. Cir.
2002). The plaintiff sought a declaratory judgment that the
defendant had violated the SCA by requiring bidders to offer
wages under a different federal statue, the Davis-Bacon Act
(“DBA”), instead of the SCA. See Id. at
201. The court reaffirmed that “the SCA creates no
private remedy” in the federal courts. Id.
(internal quotation marks omitted). “Instead, disputes
arising under the SCA must be resolved, in the first
instance, ” the court held, “by ‘the
statutory scheme for administrative relief set forth by
Congress in the SCA' and administered by the Department
of Labor.” Id. (quoting Danielsen,
941 F.2d at 1226). The court ...