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OFCCP continues to post FY 2017 settlements not publicized via agency press releases

May 18th, 2017  |  Cynthia L. Hackerott  |  Add a Comment

The OFCCP’s practice of posting online (via its Class Member Locator webpage and FOIA Reading Room) some conciliation agreements and consent decrees for which the agency did not issue a corresponding press release continues. The following is a listing of such agreements not previously reported in Employment Law Daily . In all of the cases listed below, the contractor did not admit liability.

Compass Group USA, Inc. Compass Group USA, Inc. (Compass), a hotel and hospitality services establishment, will pay a total of $29,921.16 to resolve allegations of hiring discrimination at its Morrison Sector @ Mobile Infirmary, #1055 facility located in Mobile, Alabama. Through a compliance review, the OFCCP determined that from March 1, 2012 through January 31, 2013, the federal contractor discriminated against 189 qualified black applicants who applied for “Service Worker” positions and were not hired. Under a conciliation  agreement, signed between February 15 and March 2, 2017, the contractor will also extend 8 job opportunities to eligible class members as positions become available.

John W. Stone Oil Distributor, LLC. In a conciliation agreement, signed between March 14 and 21, 2017, John W. Stone Oil Distributor, LLC, a company that supplies dockside, midstreaming and offshore fueling, agreed to pay $271,444 in back pay and $28,556 in interest to resolve allegations that it discriminated against 51 qualified minorities who applied for “Deckhand” positions at its Gretna, Louisiana, facility and were not hired. Pursuant to the agreement, JW Stone will also extend 10 job opportunities. The period of alleged discrimination is August 28, 2012 through August 27, 2014.

Land O’ Lakes, Inc. Settling allegations of gender-based pay discrimination at its facility in Shoreview, Minnesota, Land O’Lakes, Inc. has agreed to pay $42,000 to 14 female “Livestock Production Specialists” whom the OFCCP asserts, as of May 29, 2009, were paid less than their male counterparts. The OFCCP determined that there was a pay disparity through a multiple regression analysis. Workers in those positions sell feed and related products and, according to the agency, the pay disparity was caused by discriminatory duty assignments, sales incentive pay programs, and pay increases that negatively affected females. Under a conciliation agreement signed between March 6 and 20, 2017, Land O’ Lakes also agreed to revise relevant policies, and complete a regression analysis of compensation data as of December 31, 2016, for workers in the position at issue. In addition, the contractor will complete a study to evaluate whether promotion decisions, performance evaluations, work assignments, training opportunities, and transfer opportunities are having a disproportionately negative effect on pay equity.

Nebraska Medical Center. Nebraska Medical Center, a complex of hospitals, medical clinics and healthcare colleges, will pay $275,000 to resolve OFCCP allegations that it discriminated against 137 qualified black applicants who applied for “Psych/Clerk Patient Care Tech” and “Clerk/Patient Care Technicians (CNAs)” positions at the contractor’s Omaha, Nebraska facility. The agency alleges that this discrimination occurred from January 1, 2007 through June 30, 2008. Under a conciliation agreement, signed between April 28 and May 9, 2017, the contractor will also extend 23 job opportunities as well as review and evaluate policies affecting hiring selection process.

Oil State Skagit Smatco, LLC. Through a conciliation agreement signed February 8 and 15, 2017, Oil States Skagit Smatco, LLC has agreed to pay $65,000 in back pay and interest that it discriminated against minority applicants for “Mechanic I” positions at its Houma, Louisiana establishment between August 15, 2011 through April 4, 2013. The contractor, which provides offshore equipment and services, also agreed to extend job offers to seven eligible class members and remedy other specified deficiencies with its hiring process, including failing to maintain records, to set a placement goal, and to list job openings with the state workforce agency or local employment service delivery system as required under VEVRAA.

Setex Inc. Manufacturer Setex, Inc., will pay $293,760 to resolve hiring allegations against 63 qualified applicants for “Assembly Technician” positions at its Saint Mary’s, Ohio facility. The conciliation agreement, signed on May 1st and 2nd, 2017, also provides that Setex will extend job offers until 10 eligible class members are placed into the assembly technician positions and that the contractor will revise its selection procedures. The period of alleged discrimination is January 1, 2012 and December 31, 2013.

Sno–White Linen & Uniform Rental. Pursuant to a conciliation agreement signed April 17 and 20, 2017, Sno–White Linen & Uniform Rental, a privately owned industrial laundry and uniform rental company, will pay $90,000 to resolve allegations that it discriminated against 103 whites who were not hired into “Laborer” positions, and 15 whites and 8 females who were not hired into “Route Driver” positions at its Colorado Springs, Colorado facility. Sno–White has also agreed to extend 30 job offers to white class members for Laborer positions, as well as 3 job offers to white class members and 1 job offer to a female class member into the Route Driver position. The OFCCP alleges this discrimination occurred between November 2011 and July 2014.

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Paralift van drivers entitled to overtime pay because capacity of vans measured by present configuration

May 16th, 2017  |  Ron Miller  |  Add a Comment

Paralift van drivers successfully argued that they were entitled to overtime pay because the vehicles they operated were not exempt from FLSA overtime under the Motor Carrier Act exemption, ruled the Eighth Circuit. In LaCurtis v. Express Medical Transporters, Inc., the appeals court concluded that a district court correctly determined that the vans were not “designed or used to transport more than eight passengers” under Section 306(c) of the SAFETEA-LU Technical Corrections Act (TCA). As originally manufactured, the vans could accommodate either 12 or 15 passengers. However, they underwent significant modifications to be employed as wheelchair accessible vehicles. The vans weighed less than 10,000 pounds, and were presently configured to accommodate less than eight passengers (including the driver).

In this case, several paralift van drivers initiated separate actions seeking to recover overtime pay. Those cases were consolidated into this action. Although the drivers routinely worked more than 40 hours a week, their employer did not pay them overtime. It argued that the drivers were not eligible for overtime because the overtime provisions did not apply to any employee with respect to whom the Secretary of Transportation has power to establish qualifications and maximum hours of service—commonly referred to as the Motor Carrier Act (MCA) exemption.

Design and use. The pivotal issue was whether the paralift vans in this case were “designed or used to transport more than 8 passengers” for purposes of Section 306 of the TCA. The vans were originally designed and manufactured to carry up to 12 and 15 passengers. They have a gross vehicle weight of 10,000 pounds or less. Before placing the vans in service, they were converted into paralift vans. The vans as configured have a maximum seating capacity of five and six passengers (two passengers in wheelchairs, and up to five additional passengers).

Motor carrier exemption. In 2008, Congress passed the SAFETEA-LU Technical Corrections Act (TCA), which narrowed the scope of the MCA exemption. Under the TCA, the FLSA overtime provisions “apply to a covered employee notwithstanding the MCA exemption.” The term “covered employee” means a driver or helper “whose work, in whole or in part,” affects “the safety of operation of motor vehicles weighing 10,000 pounds or less,” unless the vehicle is “designed or used to transport more than 8 passengers (including the driver) for compensation.”

Deference. The district court gave deference to U.S. Department of Labor Field Assistance Bulletin No. 2010-2 (FAB 2010-2) in which the agency announced that it would determine whether a vehicle is “designed or used to transport more than 8 passengers” “based on the vehicle’s current design and the vehicle capacity as found on the door jam plate.” Accordingly, the lower court concluded that wheelchair placement should count as one passenger, and decided that the employees were “covered employees” under TCA Section 306 because the paralift vans they drove had fewer than eight seats. It granted the employee’s motion for partial summary judgment on the issue of liability.

On appeal, the Eighth Circuit had to determine whether the district court erred in failing to give controlling deference to 49 C.F.R. Section 571.3(b)(1) in interpreting TCA, Section 306. It concluded that it did not. There was nothing in the record to indicate that either the Secretary of Transportation or the FMCSA had examined the TCA or weighed in on its meaning or its possible effect on the MCA exemption, much less said that the limited definition in Section 571.3(b)(1) should control the appeals court interpretation of the TCA. Accordingly, the district court did not err in declining to give controlling deference to Section 571.3(b)(1) in deciding the drivers were “covered employees” under TCA, Section 306.

Meaning of “designed.” Next, the appeals court had to determine if the paralift vans were “designed or used to transport more than 8 passengers.” Here, the appeals court gave “some deference” to the WHD interpretation in FAB 2010-2. The term “designed” is not defined in the TCA, and the statute lacks a “temporal qualifier” that would make the meaning clear as it relates to the dispute in this case. It found that the interpretations proposed by both parties were reasonable. However, it concluded that Congress did not intend for the term “designed” as used in TCA, Section 306(c) to be limited to a vehicle’s original design no matter what happened to the vehicle after its original design. Because the paralift vans could no longer accommodate more than seven passengers following modification, the district court’s judgment that the employer was liable for overtime pay was affirmed.

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Republican lawmakers warn HHS Secretary that memo may violate whistleblower protections

May 10th, 2017  |  Pamela Wolf  |  Add a Comment

Efforts to remind the Trump Administration about whistleblower protections are still ongoing—and it’s a bipartisan effort. Most recently, Senate Judiciary Committee Chairman Chuck Grassley (R-Iowa) and House Oversight and Government Reform Committee Chairman Jason Chaffetz (R-Utah) came down hard on the Department of Health and Human Services in response to a memo instructing employees to inform the agency before communicating independently with Congress. In a May 4 letter to Secretary Tom Price, the Republican leaders criticized the memo, calling it “potentially illegal and unconstitutional.” The Trump Administration has been called out on potential whistleblower issues since even before the inauguration, when federal agency Inspectors Generals were purportedly told to start looking for other employment.

In their letter to Secretary Price, the Senators reiterated the need for whistleblower protections and asked the Secretary to issue guidance clarifying that employees have the right to communicate “directly and independently with Congress.” Grassley and Chaffetz pointed out that the memo did not include an exception for “lawful, protected communications with Congress.” The Republican lawmakers expressed concern that in its current form, employees are likely to interpret the memo “as a prohibition, and will not necessarily understand their rights.”

“These provisions are significant because they ensure that attention can be brought to problems in the Executive Branch that need to be fixed,” the lawmakers wrote. “Protecting whistleblowers who courageously speak out is not a partisan issue—it is critical to the functioning of our government.”

“In order to correct this potential violation of federal law, we request that as soon as possible you issue specific written guidance to all agency employees making them aware of their right to communicate directly and independently with Congress. Such guidance should inform employees of the whistleblower protections that apply, and make clear that the agency will not retaliate against any employee who chooses to exercise these rights. Once you have issued this guidance, please provide the Committees with a copy.”

Still a problem … This is not the first time that warnings about whistleblower protections have been raised in response to actions taken under the Trump Administration. Following reports that federal employees had been ordered not to make outward-facing statements for public consumption, including through blogs and twitter accounts, the U.S. Office of Special Counsel (OSC) on January 25 released a statement detailing its enforcement of the anti-gag order provision in the WhistleblowerProtection Enhancement Act.

Amidst mounting concerns about retaliation against whistleblowers, House Committee on Oversight and Government Reform Ranking Member Elijah Cummings (D-Md.), in a January 25 interview on “Morning Joe,” expressed concern over the purported gag order imposed on federal employees at the direction of the Trump Administration. Cummings said that the Committee relies on whistleblowers and noted that there had been some confusion over whether whistleblowers can talk to Congress. Cummings assured federal employees that they can in fact talk to Congress and that the law protects then when they do so.

On February 1, Grassley, Chaffetz, and Government Operations Subcommittee Chairman Mark Meadows (R-N.C.) sent a letter to White House Counsel Donald McGahn, urging the Trump Administration to protect whistleblowers as a means of encouraging transparency throughout the federal government. “Whistleblowers can be one of the incoming Administration’s most powerful allies to identify waste, fraud, abuse, and mismanagement in the federal government and ‘drain the swamp’ in Washington, D.C.,” the Republican lawmakers wrote.

“The White House is in a position to alleviate any potential confusion for federal employees regarding whether … recent memoranda implicate whistleblower protection laws,” the Republican lawmakers suggested. “As the new Administration seeks to better understand what problems exist in this area, this is an appropriate time to remind employees about the value of protected disclosures to Congress and inspectors general in accordance with whistleblower protection laws.”

Earlier bid to remove Inspectors General. On January 31, Cummings and Gerald E. Connolly (D-Va.), Vice Ranking Member of the House Committee on Oversight and Government Reform, also sent a letter to McGahn. Cummings and Connolly requested information about what they called “disturbing reports that officials from the Trump Transition Team threatened to remove Inspectors General after the inauguration.” Inspectors General, of course are the formal “whistleblowers” of sorts who scrutinize federal agency actions.

The Inspector General Act of 1978, passed in the wake of the Watergate scandal, is aimed at ensuring integrity and accountability in the Executive Branch. The Act created independent and objective units to conduct and supervise audits and investigations related to agency programs and operations.

The Cummings and Connolly correspondence came in response to reports that on January 13, Trump officials from various federal agencies engaged in what was seen as a coordinated campaign to “inform” Inspectors General that their positions were “temporary.” Several Inspectors General were purportedly informed that they should begin looking for other employment. Following a number of urgent calls, some of the Inspectors General were informed that the action had been overruled by more senior officials and never should have occurred, but there was no official communication in confirmation.

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Sharing racist Facebook post warranted demotion, arbitrator rules

May 4th, 2017  |  David Stephanides  |  Add a Comment

A second shift supervisor took a vacation day to watch the Super Bowl. At some point, while at home watching the game, he received a video that he thought was amusing, and he posted it to his Facebook page. His Facebook friends included several co-employees, including at least one he supervised. As it turns out, however, the video, which was about two minutes long and showed a man giving a banana to a gorilla, was incredibly racist, given that the voiceover equated the gorilla with African-Americans. The employer received 40-50 phone calls complaining about the video. As a result, the employer demoted the supervisor, and he filed a grievance.

The employer’s justification for the demotion was found in the employee’s violation of two workplace policies. One policy required a work atmosphere free of discriminatory harassment and inappropriate behavior. The other required a respectful workplace free from violence, unethical conduct, or offensive conduct. The employee’s defense was that he had no idea that the video was racist because he did not listen to the audio and was unaware of the comparison of the gorilla to African-Americans. Even if he were to be believed, however, posting such a video created an environment that violated the employer policies.

One key question was whether those policies applied to activities that took place away from work. The arbitrator concluded that the video was “brought to the workplace” by posting the video to a Facebook page that included co-employees (and at least one person he supervised). It was the same, the arbitrator said, as if the employee had shown the video to co-workers in the break room at work.

The other key issue was whether the employee’s violation of the workplace policies justified a demotion, without first resorting to progressive discipline. Relying on testimony from a 37-year employee with supervisory responsibilities, the arbitrator concluded that the employee’s supervisory responsibilities had been fatally compromised by the Facebook posting. Admittedly, he was not given progressive discipline, but the employer could not be required to retain him as a supervisor in order to determine if morale and order suffer as a result of his actions. Its determination that his actions justified immediate demotion was reasonable under the circumstances. The grievance, therefore, was denied. Metropolitan Council and Transit Managers and Supervisors Association. 17-1 ARB ¶6883. Sherwood Malamud.

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Company accused of terminating Air National Guard member settles DOJ lawsuit

April 28th, 2017  |  Deborah Hammonds  |  Add a Comment

Earlier this month, the Department of Justice announced that it had settled a case in which a Rapid City, South Dakota-based company allegedly violated the Uniformed Services Employment and Reemployment Rights Act (USERRA) by failing to reemploy and ultimately terminating a servicemember.

According to the Justice Department’s complaint, Staff Sgt. Amber Ishmael’s military service was a motivating factor in BioFusion Health Products, Inc’s decision to deny her request for reemployment after an extended military leave and to terminate her employment.

At the time of her termination, Staff Sgt. Ishmael was a Senior Airman with the South Dakota Air National Guard, where she has served honorably since 2010. Staff Sgt. Ishmael was terminated following her deployment to attend Airmen Leadership School, a professional military education training associated with her military service. Under the terms of the settlement agreement, BioFusion has agreed to pay $3,000 in back pay.

“As a member of the Air National Guard, Staff Sgt. Ishmael was called upon to leave her civilian employment and serve our nation,” said Acting Assistant Attorney General Tom Wheeler of the Justice Department’s Civil Rights Division. “Our role at the Department of Justice is to protect the rights of the men and women who defend our freedom and safeguard our way of life, and this settlement demonstrates our robust and continuing commitment to those efforts.”

“Members of our Air National Guard must frequently sacrifice time away from their families and civilian jobs in service to our country,” added U.S. Attorney Randolph J. Seiler of the District of South Dakota. “When military obligations require servicemembers to be absent from their jobs, their employment rights must be protected. The Civil Rights Section at the U.S. Attorney’s Office in South Dakota is committed to protecting those rights. This settlement agreement demonstrates that when employers disregard their obligations under USERRA, our office will hold them accountable for their violations.”

The complaint was filed in the U.S. District Court, District of South Dakota. The case stems from a referral by the Department of Labor following an investigation by the agency’s Veterans’ Employment and Training Service (VETS).  After resolution failed, VETS referred the complaint to the Justice Department’s Civil Rights Division.  Assistant U.S. Attorney Alison Ramsdell of the U.S. Attorney’s Office in the District of South Dakota, handled the lawsuit with the assistance of the Civil Rights Division, both of whom work collaboratively with DOL to protect the jobs and benefits of servicemembers.

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