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.