News Law and Policy

Labor Department Takes Important Step On Pay Discrimination Claims

Jessica Mason Pieklo

The Department of Labor announced it was lifting rules put in place by the Bush administration that made investigating pay discrimination claims nearly impossible.

On Tuesday the Labor Department rescinded two guidance documents, originally issued during the George W. Bush administration, that the agency says have impeded investigations of pay discrimination claims.

Investigators in the department’s Office of Federal Contract Compliance Programs (OFCCP) will now be better able to find and examine evidence in discrimination claims, and evaluate contractor compliance with Executive Order 11246, which requires federal contractors to comply with anti-discrimination obligations, including prohibitions against pay discrimination.

The Bush-era guidelines made it harder for the OFCCP to exercise its full legal authority because they required use of the same narrow formula to review all contractor pay practices, regardless of the industry, types of jobs, issues presented or available data. Now, OFCCP will be using its legal authority to hold contractors to the same legal standard that courts and other federal agencies already apply to these businesses to prohibit job discrimination.

The change is designed to give the agency more flexibility in uncovering discriminatory pay practices and is seen as a necessary step in getting to the more invidious practices that often lack direct evidence of a discriminatory intent. “A strong American middle class hinges on ensuring equal pay,” said acting Secretary of Labor Seth D. Harris in a statement announcing the change. “As President Obama has made clear, everyone… must be paid fairly and without discrimination. These new standards will strengthen our ability to ensure that women and men are fully protected under our nation’s laws.”

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The news was welcomed by equal pay advocates like Congresswoman Rosa DeLauro (D-Conn.). “The Department’s announcement is welcome news for the millions of women who are victims of pay discrimination,” said DeLauro to The Hill. “These Bush-era ‘guidelines’ have hamstrung DOL and they never should have been implemented in the first place.”

Could the move signal more aggressive action to come from the administration on equal pay issues? Perhaps. Absent action from Congress on equal pay legislation like the Paycheck Fairness Act, forcing the issue through its federal contracts is one way to start eradicating the practice and build the case for Congressional action. At the very least it is certainly a step in that direction.

News Economic Justice

Paid Leave Push Gains Power on State, Local Levels

Christine Grimaldi

In an effort to study the impact of enacting paid family and medical leave programs, the U.S. Department of Labor (DOL) will divide $1.1 million in federal funds between Denver, Colorado; Hawaii; Indiana; Franklin County, Ohio; Pennsylvania; and Madison, Wisconsin.

The Obama administration’s latest round of grants to states and localities to study paid leave builds on existing momentum for corresponding federal policy, according to a leading workplace advocate.

In an effort to study the impact of enacting paid family and medical leave programs, the U.S. Department of Labor (DOL) will divide $1.1 million in federal funds between Denver, Colorado; Hawaii; Indiana; Franklin County, Ohio; Pennsylvania; and Madison, Wisconsin.

Comparable DOL grants awarded to other areas across the United States since 2014 have determined that “paid leave is not nearly as expensive as most people would like to espouse,” Sarah Fleisch Fink, director of policy and senior counsel for workplace at the National Partnership for Women and Families, told Rewire in an interview.

Studying paid leave enables lawmakers and advocates to obtain “critical information” about how much a program would cost and which agency should administer it, Fleisch Fink said. Such considerations differ from state to state and locality to locality.

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Fleisch Fink said that DOL paid leave grants have also contributed to assessing another cost: inaction. And they have increased education and awareness about how to access benefits in places where they do exist, she added.

For some prior recipients of DOL grants, the findings are convincing enough to get lawmakers in their jurisdictions on board with paid leave. Massachusetts and the District of Columbia, two of the recipients of the agency’s 2014 round of grants, subsequently advanced paid leave bills, though they remain pending in the state legislature and city council, respectively.

Steps forward like these are enough to give advocates like Fleisch Fink hope at a time when decades-old federal policy, the Family and Medical Leave Act of 1993, only guarantees unpaid leave and excludes 40 percent of the workforce.

In the U.S. Congress, Rep. Rosa DeLauro (D-CT) and Sen. Kirsten Gillibrand (D-NY) are the lead sponsors behind the Family and Medical Insurance Leave (FAMILY) Act (HR 1439, S 786), which would create a national insurance program guaranteeing all workers receive paid family and medical leave. As with a prior version they introduced in 2013, the FAMILY Act would provide all workers—regardless of company size and including part-time, lower-wage, and self-employed workers—two-thirds of their income for up to 12 weeks in the event of serious illness, after childbirth, or to care for a seriously ill relative.

Although the current Republican majority in Congress typically opposes paid leave, state-level progress and public support left Fleisch Fink optimistic for federal action.

“We feel like we’re at a pivotal moment,” she said.

News Economic Justice

Wage Theft on Capitol Hill: Cafeteria Workers to Receive $1 Million in Back Pay

Michelle D. Anderson

“Most struggle to afford life’s basic expenses and pay their bills; they shouldn’t have to deal with paychecks that don’t accurately reflect their hard work and the wages to which they are legally entitled,” said David Weil of the U.S. Department of Labor.

Hundreds of people who work in cafeterias that serve U.S. senators and their legislative staffers on Capitol Hill will reportedly receive $1 million in back pay in connection to a United States Department of Labor wage theft investigation.

According to a Washington Post report, 674 food service workers will receive their owed compensation. The back wages break down to about $1,500 per worker.

Officials from the department’s Wage and Hour Division last week said an investigation had revealed the workers were denied prevailing wages that contractor Restaurant Associates and subcontractor, Personnel Plus, were obligated to pay under federal labor law.

Architect of the Capitol, the federal agency that runs the United States Capitol Complex, had contracted the employers.

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The Labor Department said Restaurant Associates and Personnel Plus violated by the McNamara-O’Hara Service Contract Act (SCA) and the Fair Labor Standards Act (FLSA) by improperly classifying workers so that they could be paid wages for lower-paying jobs and by requiring employees to work prior to their scheduled starting times.

One cafeteria worker told the Washington Post in January that his hourly wage dropped to $13.80 an hour from $17.45 after his job title changed from “cook” to “food service worker.”

The employer also failed to pay required health and welfare benefits and violated SCA, which applies to every U.S. government contract valued in excess of $2,500, by failing to adhere to the law’s record keeping requirements.

David Weil, the department’s Wage and Hour Division administrator, said in a statement last week that restaurant industry workers are among the lowest-paid workers in the U.S. economy.

“Most struggle to afford life’s basic expenses and pay their bills; they shouldn’t have to deal with paychecks that don’t accurately reflect their hard work and the wages to which they are legally entitled,” Weil said.

The division is reviewing its findings to determine whether it will keep the Restaurant Associates from securing any more contracts with the federal government.

Labor Department spokesperson Joanna Hawkins told Rewire that the case is still open. She said SCA requires contractors guilty of this violation to be debarred unless the Labor Department’s Wage and Hour Division recommends otherwise “because of unusual circumstances.”

Restaurant Associates spokesman Sam Souccar told Rewire in an emailed statement that the misclassifications were largely attributable to “administrative technicalities related to our Associates’ evolving day-to-day work responsibilities, which in some cases crossed multiple job categories.”

Souccar said the company has since corrected the problem and was “100 percent committed to ensuring classifications [were] accurate going forward.” He also said Restaurants Associates valued its contract with the Architect of the Capitol and implied that the company wanted to continue working with the federal government.

Robert Guiney, president of Personnel Plus and Just Temps Staffing, disagreed with the Labor Department’s assessment. He denied any wrongdoing.

“Restaurant Associates admitted responsibility for the whole thing and they pay our employees,” Guiney said in a phone interview with Rewire. He declined to comment further.

Guiney said the Labor Department had given his company, Personnel Plus, a “clean bill of health,” according to a Courthouse News Service report.

Hawkins said Restaurant Associates is the prime contractor on the government contract in question. She said it was the company’s responsibility to formally advise subcontractor Personnel Plus of the SCA requirements.

“In this case, Restaurant Associates failed to do so. Restaurant Associates took responsibility for that and agreed to pay the back wages owed to the employees of Personnel Plus. Nonetheless, Personnel Plus also failed to pay all of its workers for all hours worked which resulted in additional back wages,” Hawkins said.

Paco Fabián, a spokes for Good Jobs Nation, an advocacy project of the Change to Win labor coalition that focuses organizing federal contract workers who work for low wages, told Rewire via phone interview that policy changes will help prevent wage theft violations.

He cited three labor-related executive actions signed by President Barack Obama, including one that raised the minimum wage to $10.10 an hour.

“It sort of kicked off an increase in minimum wage across the country because he led by example,” said Fabián, who noted that the cafeteria workers remain without union representation.

Fabián said policy changes should aim to create a system in which the most ethical bidder, rather than the lowest bidder, will be awarded a government contractor. Lowest bidders are more likely to engage in wage theft violations, Fabián said. “We want to create a system that gives preferences to companies that provide living wages and benefits and to freedom to form unions without retaliation,” he said.

Joseph Geevarghese, director of Good Jobs Nation, said in an emailed statement the recent $1 million award was the result of activism. In recent years, U.S contract workers and allies have gone on strike and filed legal multiple complaints.

“This shows that when workers act, workers can win,” Geevarghese said.

Last year, for example, more than two dozen Senate aides brought their own lunches to work and boycotted meals being served on Capitol Hill during a union drive among the cafeteria employees. Sen. Sherrod Brown (D-OH) was among those to join the boycott, according to Al Jazeera.

Sens. Brian Schatz (D-HI) and Harry Reid (D-NV) are among lawmakers who have shown support for reform on behalf of the food workers. Reid has said the federal government should stop working with the Restaurant Associates, according to an Associated Press report.

Geevarghese urged Obama to sign the Model Employer Executive Order that was recently added to the Democratic Party platform.

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