OFCCP Announces a Final Rule to Promote Pay Transparency

In too many workplaces around the country, women and people of color don’t know what their counterparts are earning for the same work. A culture of secrecy prevents them from finding out if they are being discriminated against in time to act on it. Lilly Ledbetter learned, only after decades at her job, that she had been paid less than her male counterparts. Her company’s policy forbidding her from discussing pay with co-workers prevented her from getting the information she needed to bring a complaint in time. The Lilly Ledbetter Fair Pay Restoration Act, the first piece of legislation signed by President Obama in 2009, helped people like her more effectively challenge unequal pay. However, pay secrecy policies still stand in the way of the fundamental principle of equal pay for equal work. If one of Lilly Ledbetter’s co-workers had simply been able to tell her about the discrimination that was taking place, she would have been better able to act in time to exercise her workplace rights. Indeed, the ability of workers to share information and effectively organize for their rights is a cornerstone of building an economy that works for everyone. Promoting pay transparency by prohibiting pay secrecy policies helps make the federal contractor workforce more efficient. Pay transparency helps level the playing field for women and people of color, and provides employers access to a diverse pool of qualified talent.

We know that Lilly Ledbetter’s case was not unique. Despite the existence of laws protecting workers from gender-based compensation discrimination for more than five decades, a pay gap between men and women persists today. Assuming that she works every year between ages 25 and 65, the typical woman will have lost $420,000 over her working lifetime because of the earnings gap, based on median annual earnings for full-time, year-round workers at age 25 and above in 2013. In addition to a wage gap between men and women, the research reveals a wage gap amongst various racial groups. At the beginning of 2015, median weekly earnings for African-American men working at full-time jobs totaled $680 per week - only 76 percent of the median for white men, who earned $897 per week. The median weekly earnings for African-American women equaled $611 per week, or 68 percent of the median for white men. When employees and applicants are prohibited from inquiring about, disclosing, or discussing their compensation with other workers, compensation discrimination is much more difficult to discover and remediate, and more likely to persist.

That is why, in 2014, President Obama issued Executive Order 13665, promoting pay transparency and openness, making it possible for workers and job applicants to share information about their pay and compensation without fear of discrimination. On September 10, 2015, the Department of Labor issued a Final Rule implementing that order. This Final Rule takes effect on January 11, 2016, 120 days after its publication in the Federal Register, and amends the existing regulations that implement EO 11246.
 
The Final Rule amends the EO 11246 implementing regulations by:

• Requiring that certain information be included in covered federal contracts and subcontracts. The Final Rule requires that the equal opportunity clause included in covered federal contracts and subcontracts be amended to include that federal contractors and subcontractors must refrain from discharging, or otherwise discriminating against, employees or applicants who inquire about, discuss, or disclose their compensation or the compensation of other employees or applicants. An exception exists where the employee or applicant makes the disclosure based on information obtained in the course of performing his or her essential job functions;

• Requiring that federal contractors incorporate a prescribed nondiscrimination provision into their existing employee manuals or handbooks and disseminate the nondiscrimination provision to employees and to job applicants;

• Defining key terms such as compensation, compensation information, and essential job functions as used in EO 11246, as amended; and

• Providing employers with two defenses to an allegation of discrimination: a general defense, which could be based on the enforcement of a "workplace rule" that does not prohibit the discussion of compensation information; and an essential job functions defense. 

The Final Rule is effective January 11, 2016 and applies to all new contracts over $10K.  The FAQ section provides additional insight and details on this final rule.

Read the Final Rule and Executive Orders
•    Read the Final Rule
•    Read Executive Order 13665
•    Read Executive Order 11246

Source: Office of Federal Contract Compliance Programs (OFCCP)

DOL finds federal contractor misclassified workers as independent contractors

Employees due more than $135K in back wages

 

Employer name: Pegasso Construction & Floor Covering LLC

Investigation site: Office at 1746 Hazel Wood Drive, Marietta, Ga., 30067 and various jobsites including Ft. Gordon army base in Augusta, Ga.

Investigation findings: Investigators from the department's Wage and Hour Division found that Pegasso misclassified all of its workers as independent contractors. This unlawful practice resulted in violations of the Fair Labor Standards Act, the Davis-Bacon and Related Acts and the Contract Work Hours and Safety Standards Act. The employer paid many of these workers on a weekly salary basis without regard for the number of hours worked. In some cases this salary, when divided by the number of hours worked, was not sufficient to meet the current federal minimum wage of $7.25 per hour. The contractor also failed to pay legally required overtime when these employees worked beyond forty hours in a workweek. As a result of these violations of the minimum wage and overtime provisions of the FLSA, Pegasso owes 151 employees back wages of $135,819. The firm also violated the DBRA and CWHSSA, which apply to the federally financed work done at Fort Gordon, by not accurately completing the required certified payrolls and by failing to pay overtime to one worker.

Resolution: Pegasso has agreed to future compliance with DBRA, CWHSSA and the FLSA and to pay the back wages. The employer has also put all workers on his payroll and will properly classify them as employees.

Quote: "Misclassification of employees as independent contractors cheats workers of wages and benefits to which they would otherwise be entitled to under the law, subsequently hurting our economy. It also leads to unfair competition because businesses that play by the rules operate at a disadvantage to those that don't. We will continue to work to ensure that workers receive the wages they have rightfully earned."
— Eric Williams, Wage and Hour Division Atlanta District Office Director

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Baltimore staffing agency allegedly harassed, discriminated against and allowed assault and abuse of Hispanic employees

Suit also alleges discrimination against non-Hispanics, intentional underpayment of women

A Baltimore staffing agency for federal contractors allegedly hired Hispanic construction laborers, and then harassed and discriminated against them. It also allowed supervisors of other federal contractors to assault them physically, make racial slurs, and threaten them with deportation. The allegations were made in a lawsuit filed by the U.S. Department of Labor's Office of Federal Contract Compliance Programs.

The suit also alleges that WMS Solutions LLC discriminated against non-Hispanic applicants, intentionally paid female workers less per hour than males and assigned fewer work hours to African American, Caucasian and female laborers.

The department alleges that since at least Feb. 1, 2011, WMS favored hiring Hispanic laborers, and that company managers knowingly permitted abusive practices by supervisors at their work sites. In addition to physical and verbal abuse and harassment, supervisors intimidated laborers with videos of detained and deported Hispanic workers. Despite knowing of the illegal harassment, WMS managers took no action to stop it.

"WMS allowed workers it hired to be exploited and abused. It denied job opportunities to qualified workers based on race and ethnicity. It underpaid female workers and assigned fewer work hours based on race and gender," said OFCCP Director Patricia A. Shiu. "We have taken action on behalf of these workers. OFCCP is prepared to use every tool at its disposal to ensure that no federal contractors and subcontractors engage in discrimination or harassment."

OFCCP discovered the company's discriminatory practices in its review to determine WMS' compliance with Executive Order 11246. The order prohibits federal contractors from discriminating on the basis of race, color, religion, sex, sexual orientation, gender identity or national origin. OFCCP filed its complaint with the department's Office of Administrative Law Judges after it did not secure an agreement from WMS to pay back wages and interest to the affected workers; extend job offers to the rejected applicants; and provide a working environment for its employees free of harassment, intimidation and coercion.

WMS is a Baltimore-based company specializing in asbestos removal and demolition. The company provides laborers to federal contractors performing construction work on projects in the Washington, D.C., area. At the time that the alleged discrimination and harassment occurred, the company held federal construction subcontracts totaling more than $6 million for projects involving the General Services Administration, National Institutes of Health and U.S. Department of the Navy.

Source: OFCCP

This information is intended to be educational and should not be considered legal advice on any specific matter.

Federal subcontractor to back wages in Hawaii

A California-based heating, ventilation and air conditioning subcontractor has paid 58 workers $99,681 in back wages after an investigation found federal wage and hour laws were violated on three federally funded construction projects awarded by the U.S. Army in Hawaii between 2011 and 2013.
 
U.S. Department of Labor Wage and Hour Division investigators discovered Critchfield Pacific Inc., of San Jose, violated laws governing federal contractors. The subcontractor improperly categorized employees as lower-paid maintenance workers rather than using job titles for those doing plumbing and pipe-fitting work at the Schofield Barracks and Kunia job sites on Oahu. Critchfield exceeded the ratio of lower-paid apprentices to experienced plumbers and sheet-metal workers. The company also failed to pay employees for time spent at mandatory safety meetings in advance of their scheduled work shifts at Schofield Barracks.

"Federal contractors owe it to taxpayers to comply with all applicable laws, including paying their workers fairly and fully, in accordance with the government contract," said Terence Trotter, district director for the Wage and Hour Division in Honolulu. "In this case, we appreciate the cooperation by Critchfield Pacific and their endorsement of an action plan that promotes future compliance with relevant labor standards."

The Davis-Bacon Act requires that all contractors and subcontractors performing work on certain federally funded construction projects pay their laborers and mechanics at least the prevailing wage rates associated with their occupation, as determined by the secretary of labor.

The Contract Work Hours and Safety Standards Act applies to contractors and subcontractors with federal service contracts and federally funded and assisted construction contracts exceeding $100,000. It requires contractors and subcontractors on covered contracts to pay laborers and mechanics employed in the performance of the contracts overtime at one and one-half times their basic rate of pay for all hours worked over 40 in a workweek.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Federal contractor pays nearly half of a million dollars in back wages

Guards denied prevailing wages, fringe benefits and overtime compensation

 

Employer name: PTS of America LLC doing business as Prisoner Transportation Services of America, Nashville, Tennessee

Investigation sites: PTS corporate headquarters, Nashville, Tennessee; Phoenix-Mesa Gateway Airport, Mesa, Arizona; Alexandria International Airport, Alexandria, Louisiana; and San Antonio International Airport, San Antonio, Texas.

Investigation findings: PTS of America LLC is a prisoner extradition company and an international transporter of detainees. The firm is a subcontractor of CSI Aviation Services Inc., a prime contractor for the U.S. Immigration and Customs Enforcement at several airports.

Wage and Hour Division investigators found that PTS violated the McNamara O'Hara Service Contract Act by failing to pay detention officers the required prevailing wages along with health and welfare fringe benefits. Additionally, the contractor violated the Contract Work Hours and Safety Standards Act by failing to properly calculate and pay overtime compensation to 77 employees. As a result of these violations, PTS owed 204 employees back wages of $430,788 under the SCA and an additional $14,927 in overtime back wages under CWHSSA. PTS also violated Executive Order 13495 by failing to offer jobs to three employees who were employed with the previous contractor. The order requires that workers on a federal service contract who would otherwise lose their jobs as a result of the completion or expiration of a contract be given the right of first refusal for employment with the successor contractor.

Resolution: CSI Aviation Services Inc. has paid a total of $445,715 in back wages, which is being distributed to 204 employees. Under the SCA, a contractor is held financially responsible for monetary wage violations committed by its subcontractors. PTS has agreed to future compliance with SCA, CWHSSA and the Fair Labor Standards Act. Additionally, the company agreed to rehire the three workers who were not offered jobs and paid back wages to them as part of separate administrative action by the National Labor Relations Board.

Quote: "Enforcement of the prevailing wage laws levels the playing field for all contractors and protects the wages of hard-working, middle-class American workers. The Wage and Hour Division will remain vigilant in its enforcement to ensure employees are paid in accordance with prevailing wage laws." said Nettie Lewis, director of the division's Nashville District Office. "We are pleased that we were able to successfully collaborate with the contracting agency and the prime and subcontractor to get these hardworking employees the wages they rightfully earned."

Source: DOL

OFCCP Posts New Web Page Providing Visa Denial Information

In response to contractor inquiries, OFCCP has posted a new Web page that provides information related to entry visa denials by foreign governments, on the basis of sexual orientation or gender identity, for contractors’ employees or potential employees.  The page explains how contractors contact OFCCP and the State Department, as required by OFCCP regulations, should the company’s request for a visa for an employee be denied on the basis of sexual orientation or gender identity.  It also provides resources to learn about the visa requirements of various countries, and information regarding what a company may do to obtain assistance if it has difficulty obtaining a visa.

The Visa Denials by Foreign Governments Web page can be found on the OFCCP Web page at http://www.dol.gov/ofccp/LGBT/VisaDenial.htm

Source: OFCCP

This information is intended to be educational and should not be considered legal advice on any specific matter.

Oral Arts Laboratory Inc. settles hiring discrimination case

Huntsville, Alabama, manufacturer will pay $115K in back wages, interest to 159 applicants

Oral Arts Laboratory Inc., a dental lab and manufacturer, will pay $115,000 to resolve allegations of systemic hiring discrimination at its Huntsville corporate headquarters. A compliance review by the U.S. Department of Labor's Office of Federal Contract Compliance Programs found that the federal contractor discriminated against 83 women and 19 African Americans who were denied dental lab technician positions, as well as 57 men who were rejected for shipping positions. Under the agreement, Oral Arts will extend job offers to at least 19 of the original class members as positions become available.

"This agreement underscores the notion that federal contractors, like Oral Arts, should closely examine their employment policies and practices to identify and eliminate unfair barriers to equal opportunity," said OFCCP Director Patricia A. Shiu.

OFCCP investigators found that, from November 2011 to November 2013, Oral Arts used a dexterity test in the selection process for dental lab technicians. This test was used even though it was not supported by a validation study that satisfies the requirements of the Uniform Guidelines on Employee Selection Procedures.

The investigation also uncovered that the company stereotyped shipping positions as female jobs and rejected male applicants. The agency concluded that Oral Arts' hiring process systematically discriminated against women, men and African-American applicants, a violation of Executive Order 11246, which prohibits federal contractors from discriminating in employment on the basis of race or sex. The company has ceased using the tests and revised its selection process to ensure equal opportunity for all applicants.

Oral Arts is a manufacturer of dental prostheses, orthodontic appliances, fixed and removable implants and dentures. A family owned and operated dental lab, Oral Arts in 2014 held more than $2 million in federal contracts with the U.S. Department of Veterans Affairs.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Coming Into Compliance with Sexual Orientation and Gender Identity Requirements

On April 8, 2015, the U.S. Department of Labor’s Office of Federal Contractor Compliance Program (OFCCP) will begin requiring federal contractors to treat applicants and employees without regard to their sexual orientation and gender identity, pursuant to Executive Order 13672 signed by President Obama on July 21, 2014. 

To learn more about how OFCCP will implement these nondiscrimination requirements, please join us for an informational Webinar on Wednesday, March 18, 2015.  The same Webinar will be presented again on Wednesday, March 25, 2015.  Both sessions will include a question and answer session.     

To register for either Webinar, please use the following links:

March 18: https://dolevents.webex.com/dolevents/onstage/g.php?MTID=ed62ccb7c66f848e5cd6cd79d35459db9

March 25: https://dolevents.webex.com/dolevents/onstage/g.php?MTID=ebfc0c675c0d2101a195b4e1833a00b6f

Source: OFCCP

This information is intended to be educational and should not be considered legal advice on any specific matter.

Avcon Constructors Inc. fails to fund employee benefit plans on federally financed construction projects

An investigation by the U.S. Department of Labor’s Wage and Hour Division discovered that Napa-based Avcon Constructors Inc. did not make timely benefit plan payments on behalf of 19 employees working at the San Francisco Veterans Affairs Hospital and the Training Exercise Warehouse at Fort Hunter Liggett. Employees on these projects were working on federally financed contracts subject to Davis-Bacon and Related Acts regulations. The DBRA requires that contributions to funds for bona fide fringe benefits must be made at least quarterly.

“Taxpayers have the right to expect that federal contractors understand their obligations and comply with the law,” said Susana Blanco, director for the department’s Wage and Hour division in San Francisco. “The department works to ensure workers are paid proper wages and benefits in a timely manner. The agency will take action to recover payment when workers are denied their rightful compensation. We do so to create a level playing field for employers, ensuring those who shortchange workers do not gain a competitive advantage.”

The DBRA requires all contractors and subcontractors performing work on federal and certain federally funded projects to pay their laborers and mechanics the proper prevailing wage rates and fringe benefits, as determined by the secretary of labor. On a Davis-Bacon Act project, the prime contractor is responsible for the compliance of subcontractors and lower-tier subcontractors.

The DBA “prevailing wage” is a combination of the basic hourly rate and any fringe benefits listed in a DBA wage determination. The contractor’s obligation can be met by paying at least the prevailing wage listed in the contract wage determination and each laborer and mechanic the applicable prevailing wage entirely as cash wages or by a combination of cash wages and employer-provided bona fide fringe benefits. Prevailing wages, including fringe benefits, must be paid on all hours worked on the work site.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

U.S. DOL sues electrical contractor for failing to pay federal contract workers properly

The U.S. Department of Labor has filed a lawsuit with the Office of Administrative Law Judges against LRE Royal Electrical Contractors Inc. and its owner, George E. Smith, to recover $345,077 in back wages for 61 electrical workers. The action also seeks to prevent the company and Smith from obtaining federal contracts for three years.

The filing alleges Smith and his company, doing business as both LRE Electrical Contractors and LRE Electrical, violated the Davis-Bacon and Contract Work Hours and Safety Standards Acts when they paid electrical workers less than the applicable prevailing wage rates and corresponding overtime wages for work performed as part of four government contracts.

The Wage and Hour Division’s Little Rock District Office found that LRE Electrical and Smith did not register electrical workers in approved apprenticeship programs, but classified and paid workers as apprentices. The company and Smith also failed to pay these workers wage rates included in the contracts, which are based on the work an employee actually performs.

“Government contracts specify clearly how pay and benefits must be determined. Employers are required to adhere to these rules and pay workers correctly,” said Cynthia Watson, Wage and Hour administrator in the Southwest. “Contractors know these obligations when they bid on government contracts, and when the contracts are awarded.”

The DBA requires all contractors and subcontractors working on federal and certain federally funded projects to pay their laborers and mechanics proper prevailing wage rates and fringe benefits, as determined by the U.S. secretary of labor. Prime contractors are also responsible for compliance by subcontractors and lower-tier subcontractors.

The CWHSSA applies to federal service contracts and federal and federally assisted construction contracts exceeding $100,000. It requires contractors and subcontractors to pay laborers and mechanics one and one-half times their basic rates of pay for all hours worked over 40 in a workweek. The premium charged to employers for overtime hours when an employee works beyond 40 per week encourages employers to hire more workers on these contracts, thus creating jobs, rather than working fewer employees longer hours.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

OFCCP to Send Next Round of CSALs

The Office of Federal Contract Compliance Programs (OFCCP)will be sending Courtesy Scheduling Announcement Letters to HR directors (or designated points of contact) at 2,500 federal contractor establishments.  

Contractors may confirm whether one of their establishments was mailed a CSAL by faxing a written request on company letterhead to OFCCP’s Division of Program Operations at (202) 693-1305. For more information, check out the answers to Frequently Asked Questions about CSALs at http://www.dol.gov/ofccp/regs/compliance/faqs/csalfaqs.htm.

 

New rule streamlines reporting requirements on veterans' employment and hiring for federal contractors

On September 25, 2014, the U.S. Department of Labor published a final rule that reduces reporting requirements for federal contractors and subcontractors who hire and employ veterans under provisions of the Vietnam Era Veterans' Readjustment Assistance Act of 1974.

"Over the next decade, this change will result in a significant reduction in paperwork burden for federal contractors and subcontractors," said Assistant Secretary of Labor for Veterans' Employment and Training Keith Kelly. "In addition to easing the burden on contractors, the data collected by these reports will help the Labor Department develop more informative yearly trends in the employment of protected veterans."

The final rule revises the VETS-100A Report and renames it the VETS-4212 Report. The VETS-100 Report will no longer be used. The VETS-4212 Report requires contractors to report specified information on protected veterans in their workforce in the aggregate, rather than for each category of veterans protected under the statute, reducing the required reporting elements by almost half, from 82 to 42. Under VEVRAA, the term "protected veterans" includes: disabled veterans, veterans who served on active duty during a war or campaign for which a campaign badge was authorized, veterans who were awarded an Armed Forces Service Medal and recently separated veterans.

Under this final rule, the department will receive valuable information on the number of protected veterans employed by federal contractors and the job categories in which they work. We estimate that this rule will ultimately result in substantial savings for contractors — approximately $18.2 million over a 10-year period.

Source: DOL VETS

This information is intended to be educational and should not be considered legal advice on any specific matter.

Proposed Rule to improve pay transparency for employees of federal contractors

Prohibits federal contractors, subcontractors from discriminating against workers who discuss pay

 

The U.S. Department of Labor's Office of Federal Contract Compliance Programs today announced a proposed rule that would prohibit federal contractors from maintaining pay secrecy policies. Under the terms of the proposal, federal contractors and subcontractors may not fire or otherwise discriminate against any employee or applicant for discussing, disclosing or inquiring about their compensation or that of another employee or applicant.

"Workers cannot solve a problem unless they are able to identify it. And they cannot identify it if they aren't free to talk about it without fear of reprisal," said OFCCP Director Patricia A. Shiu. "Pay transparency isn't just good for workers. It's good for business. Fairness and openness are great qualities for a company's brand."

President Obama signed Executive Order 13665 on April 8, instructing the secretary of labor to propose a rule within 160 days to require pay transparency among federal contractors. The proposed rule, available for public inspection today, would amend the equal opportunity clauses in Executive Order 11246 to afford protections to workers who talk about pay. It would also add definitions for compensation, compensation information, and essential job functions, terms which appear in the revised clauses. The proposal also establishes two types of defenses that contractors can use against allegations of discrimination under EO 13665.

The rule will be published in the Sept. 17 issue of the Federal Register and open for public comment for 90 days. To learn more about the proposed rule, please visit http://www.dol.gov/ofccp/PayTransparencyNPRM.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Justice Department Files Lawsuit Alleging Violations of Federal Law and Executive Order by Federal Contractor

The Justice Department announced the filing of a lawsuit today against Entergy Corporation for violating Executive Order 11246, Section 503 of the Rehabilitation Act of 1973 and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974. The lawsuit alleges that the defendant violated these laws and the executive order when it refused to comply with federal contractor requirements to submit proof of required affirmative action programs to the Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP). Because Entergy has refused to supply documentation and cooperate with auditing attempts, OFCCP has been unable to determine if Entergy is in compliance with its affirmative action obligations.

“Government contractors that choose to accept federal funds also agree to abide by laws and regulations aimed at preventing employment discrimination,” said Acting Assistant Attorney General Jocelyn Samuels for the Civil Rights Division. “When a government contractor, like Entergy, refuses to adhere to the obligations it accepted as a federal contractor, that refusal undermines the public trust that taxpayers expect in ensuring that public funding is used in a manner that complies with both federal law and agency regulations.”

 

“This issue has been litigated and re-litigated many times, and the courts have been clear: companies that profit from federal contracts must comply with our requests for proof that they are meeting their obligations,” said OFCCP Director Patricia A. Shiu. “Entergy already earns more than $1 billion in taxpayer-funded contracts to provide services to the government. We shouldn’t have to spend more of those dollars taking them to court because they refuse to abide by the law. So, I urge Entergy Chairman and CEO Leo Denault to respect our nation’s hard-won civil rights laws.”

 

Entergy, as a federal contractor, is prohibited from discriminating against employees and job applicants because of race, color, sex, religion, national origin, disability or protected veteran status. The company is also required to take affirmative action to employ qualified women, minorities, people with disabilities and protected veterans. To determine compliance with those affirmative action and non-discrimination requirements, government contractors, including Entergy, are required to develop and maintain written affirmative action programs, retain personnel and employment records, and provide OFCCP access to those documents during compliance reviews or investigations. The lawsuit seeks a permanent injunction requiring Entergy to comply with its obligations, including its obligation to produce documents requested by OFCCP within 30 days of the request.

 

The complaint, filed in the U.S. District Court for the Eastern District of Louisiana, alleges that since May 2012, Entergy has refused OFCCP’s repeated requests to turn over its written affirmative action programs and other records requested as part of the routine compliance review of 11 Entergy locations in Texas, Mississippi and Louisiana.

 

The Department of Labor referred this matter to the Department of Justice when Entergy refused to submit the documents requested by OFCCP even after receiving notices to show cause why enforcement proceedings should not be initiated.

 

Source: DOJ

 

This information is intended to be educational and should not be considered legal advice on any specific matter.

DOL settles second discrimination charge against Lincoln Electric Co.

Agreement includes job offers, $1M for 5,557 African American applicants

Lincoln Electric Co. has agreed to settle allegations of hiring discrimination on the basis of race following an investigation by the U.S. Department of Labor's Office of Federal Contract Compliance Programs. An investigation by OFCCP compliance officers found that the federal contractor violated Executive Order 11246 by using a hiring process that resulted in systemic discrimination against African American applicants. As a result, 5,557 qualified African Americans were rejected for entry-level factory and production positions at the company's Cleveland facility.

Under the terms of the conciliation agreement, Lincoln Electric will pay $1 million in back wages and interest to the 5,557 affected job seekers and will offer entry-level positions to 48 class members as positions become available. Additionally, the company will revise its selection policies and procedures, including making changes to its online application test, to ensure equal employment opportunity for all job applicants going forward.

"Vigilance is paramount in enforcing civil rights," said OFCCP Director Patricia A. Shiu. "When we find violations of the law, corrective measures must be taken and lasting reform implemented so that further discrimination is not perpetuated against more workers. We will remain vigilant as we work with Lincoln Electric to ensure that unfair barriers in the company's hiring process are fixed once and for all."

During a scheduled compliance review, OFCCP determined that Lincoln Electric's paper and online application systems created multiple barriers for African Americans to advance in the selection process. In addition, Lincoln Electric's applications and post-application tests were not properly supported by a validation study that satisfies the requirements of the Uniform Guidelines on Employee Selection Procedures.
 
Since 2005, Lincoln Electric has held more than $2 million in federal contracts to manufacture welding, cutting and joining products for the federal government. The company was cited for the same violation more than a decade ago when an OFCCP review found that the contractor had discriminated in hiring against minorities and women who applied for entry-level factory jobs. Those charges were settled by a 2003 conciliation agreement that provided $1 million in back pay and interest to the affected workers in that case.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Arizona utility subcontractor debarred from federally funded projects

US Department of Labor uncovers nearly $200,000 in back wages for workers
   
The U.S. Department of Labor has recovered $198,085 in back wages for 23 workers employed by Glendale-based Tierra Contracting Inc. for willful violations of the Davis-Bacon and Related Acts and the Contract Work Hours and Safety Standards Act. Tierra Contracting and its owner, Richard Juarez Sr., also have been debarred from applying for federally funded contracts for a period of three years because of the egregious nature of the violations found.


Investigators with the department’s Wage and Hour Division in Phoenix established that Tierra Contracting failed to pay the required prevailing wage rates and fringe benefits to power equipment operators, water truck drivers, pipe layers, grade setters and laborers working at the federally funded Northern Parkway highway project in Maricopa County. Tierra Contracting routinely submitted certified payroll records that did not accurately reflect the real hours worked by the affected employees. Employees were paid for overtime hours with separate checks, off-the-record and at straight-time rates, without the additional time-and-a-half, as required.


“This employer intentionally omitted from payroll records hours employees worked beyond 40 in a workweek to skirt payment of overtime rates,” said Eric Murray, district director for the Wage and Hour Division in Phoenix. “As a result of the willful violations found, Tierra Contracting has been determined ineligible to apply for federally funded projects.”


Tierra Contracting was hired as a subcontractor by Lawrence Construction Co. to perform excavation and installation of water and sewer lines for the highway project. Lawrence Construction was awarded the project’s prime contract by the Maricopa County Department of Transportation. The Northern Parkway is funded in part by the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users.


SAFETEA-LU incorporates the provisions of the Davis-Bacon and Related Acts, which requires payment of prevailing wage rates and fringe benefits to laborers and mechanics employed on federally funded projects. The Contract Work Hours and Safety Standards Act, which also applies to this project, requires contractors and subcontractors to pay laborers and mechanics working on federally funded projects one and one-half times their basic rate of pay for all hours worked beyond 40 in a workweek.


Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

Enviro & Demo Masters and Gladiators Contracting Corp. ordered debarred from federal contracts

Enviro & Demo Masters Inc. and Gladiators Contracting Corp., along with the companies’ owner Jover Naranjo and foreman Luperio Naranjo Sr., have been ordered to pay a total of $656,646 to 37 workers after failing to pay them the required prevailing wage rates and fringe benefits on a federally funded construction project in New York City. Due to the extent and willful nature of the violations, all parties have been ordered to be debarred from seeking and obtaining federal contracts for a three-year period. In a separate proceeding, the owner and foreman were found guilty in federal court in November 2013 of criminal charges related to the project, including the submission of fraudulent certified payrolls to the New York City Department of Housing Preservation and Development. They were sentenced to six and four years in prison, respectively, on April 9, 2014. They are scheduled to surrender on June 2, 2014.


“These employers deliberately and knowingly committed willful and fraudulent violations of federal government contracts law, and they cheated a largely immigrant workforce. These workers were often required to work for less than one-third of what they should have been paid, creating undue hardship for them and their families,” said Maria Rosado, the Wage and Hour Division’s district director in Manhattan. “The department will continue its effort to ensure that workers are paid the proper wages and will take action to recover payment when workers are denied their rightful compensation. We are also working to create a level playing field among employers, ensuring that unscrupulous employers that underpay workers do not gain a competitive advantage.”


Enviro & Demo Masters Inc. and Gladiators Contracting Corp. were subcontractors performing demolition work on the construction of Hobbs Court and Ciena, two federally funded affordable housing developments in East Harlem. The Hobbs and Ciena projects were part of the Metro North Rehabilitation and Redevelopment Program, which was funded in part by the U.S. Department of Housing and Urban Development under the American Recovery and Reinvestment Act of 2009 through the New York State Division of Housing and Community Renewal and the New York City Department of Housing Preservation and Development.


An investigation by the Wage and Hour Division found that Enviro & Demo Masters falsified certified payroll records by deliberately omitting employees from the payroll, instead listing family members who performed no work on the project and listing wage rates that were not paid to workers. The company also failed to pay 37 workers the prevailing wage rates for their particular job classifications and failed to pay the workers one-and-a-half times their basic hourly rates for all hours worked above 40 in a workweek.


The subcontractors disputed the Wage and Hour Division’s findings, which resulted in a hearing before a Labor Department administrative law judge in June 2012. On April 23, 2014, Administrative Law Judge Lystra A. Harris issued a decision and order affirming the Wage and Hour Division’s findings and instructing the New York City Department of Housing Preservation and Development, which withheld the funds, to release the monies to the Wage and Hour Division for payment to the workers. The decision and order will become final 40 days after issuance if no appeal is filed.


Judge Harris also found the project’s prime contractor, Hobbs Ciena Associates LP and Hobbs Ciena Housing Development Corp., jointly and severally liable for payment of the back wages by its subcontractor Enviro & Demo Masters. On a Davis-Bacon Act covered project, the prime contractor is responsible for the compliance of all subcontractors.


The Davis-Bacon Act requires that all contractors and subcontractors performing work on federal and certain federally funded projects pay their laborers and mechanics the proper prevailing wage rates and fringe benefits, as determined by the secretary of labor. The Contract Work Hours and Safety Standards Act applies to contractors and subcontractors with federal service contracts and federally funded and assisted construction contracts exceeding $100,000. It requires contractors and subcontractors on covered contracts to pay laborers and mechanics employed in the performance of the contracts one and one-half times their basic rate of pay for all hours worked over 40 in a workweek.


Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

DOL to offer compliance seminar on prevailing wage requirements

Seminar to be held in Chicago, April 1-3, 2014

The U.S. Department of Labor’s Wage and Hour Division will offer a comprehensive compliance seminar for federal contractors, unions and employees to provide information on the rules governing prevailing wage requirements under the Davis-Bacon Act, McNamara-O’Hara Service Contract Act and Executive Order 13495 wage rules for nondisplacement of qualified workers. The seminar will be held April 1 through April 3 at the Gleacher Center, 450 North Cityfront Plaza Drive in Chicago.

“The department is committed to ensuring that all of our stakeholders—contractors, contracting officials, unions, workers and others—understand and comply with the wage and fringe benefit requirements that apply to federal and federally assisted contracts,” said Karen Chaikin, Midwest regional administrator for the Wage and Hour Division. “We are pleased to provide the contracting community with this free prevailing wage seminar that is a key component of the Wage and Hour Division’s ongoing effort to foster good jobs through increased awareness and enhanced compliance of federal prevailing wage requirements.”

Check-in for the conference will be from 7 a.m. to 9:30 a.m. on April 1, with the program running from 9:30 a.m. to 4:30 p.m. that day. The seminar will run from 8 a.m. to 4:30 p.m. on April 2 and April 3.

There is no fee to attend the seminar; however, preregistration is required. Registration can be completed by sending an email to whdpws@dol.gov that includes the participant’s name, title, organization and email address. An email will be sent to confirm registration.

Source: DOL

This information is intended to be educational and should not be considered legal advice on any specific matter.

OFCCP Posts New Information and Resources for Federal Contractors on Section 503 and VEVRAA

OFCCP, on February 21, 2014, posted new information and resources on its Web site to assist federal contractors with outreach and recruitment targeting individuals with disabilities, employing and retaining individuals with disabilities, promoting self-disclosure as a person with a disability, assistive technologies that help change corporate culture, and reasonable accommodation. Several of the new items are listed below. 

• Office of Disability Employment Policy (ODEP) resources and information on student internships, mentoring programs, workforce recruitment programs for college students with disabilities, and strategies for increasing employment opportunities within the small business community for individuals with disabilities, is available at http://www.dol.gov/ofccp/regs/compliance/resources_recruit_disability.htm
• A Better Bottom Line: Employing People with Disabilities, a report by the National Governors Association on employing individuals with disabilities and promoting self-disclosure as a person with a disability, is available at http://www.dol.gov/ofccp/regs/compliance/resources_selfid.htm
• The Forrester Research Inc. and Microsoft^[1] report on assistive technologies and corporate culture is available at http://www.dol.gov/ofccp/regs/compliance/resources_info.htm
• Information on U.S. Business Leadership Network (USBLN): Disability at Work, a non-profit helping business leverage disability inclusion in the workplace, is available at http://www.dol.gov/ofccp/regs/compliance/resources_info.htm.

Source: OFCCP

This information is intended to be educational and should not be considered legal advice on any specific matter.

 

OASIS: What You Need to Know About GSA’s Plan to Reduce Contract Duplication

Posted by Cara Battaglini, Public Affairs Officer, Federal Acquisition Service on August 22, 2013

GSA’s One Acquisition Solutions for Integrated Services (OASIS) program is a contract vehicle for complex professional services. It represents GSA’s solution to reducing contract proliferation and duplication across government. This is a problem for both government and for contractors, and when we look at what the government spends annually on professional services, the numbers are significant.

 

GSA uses the buying power of the federal government to bring down costs and reduce duplication. OASIS takes GSA Schedules to the next level by combining professional services and IT services into one package, creating a single source for both commercial and noncommercial needs – and eliminating the unneeded duplication of contracts. OASIS will offer full and open competition among all interested businesses, and OASIS SB will be a separate solicitation set aside specifically for all small businesses, maximizing opportunities to do business with the federal government.

 

We see a clear benefit to OASIS but there are underlying myths and questions about this program that remain. The following is our response to these myths and clarifications to your questions. Click here for the rest of the article.

 

This information is intended to be educational and should not be considered legal advice on any specific matter.