Continuing a practice that began in fiscal year (FY) 2016, the OFCCP’s Class Member Locator webpage and online FOIA Reading Room reveal some conciliation agreements and consent decrees entered into by the OFCCP thus far in FY 2017 for which the agency did not issue a corresponding press release. In all of the cases listed below, the contractor did not admit liability.
AmeriQual Group LLC. AmeriQual Group LLC, a food processing company, will pay $325,532 to resolve allegations of hiring discrimination at its Evansville, Indiana facility. The company produces, packages, assembles and distributes shelf-stable food products to the U.S. Department of Defense, other federal agencies and major food companies. Its products include “Meals Ready to Eat,” commonly known as MREs, used by the armed services. In an OFCCP compliance review, the agency concluded that from November 18, 2010 through September 26, 2011 the federal contractor discriminated against 221 qualified men who applied for entry-level “Production 1” positions and were not hired. In December 2015, the OFCCP announced that it had filed an administrative suit to pursue these charges. Since January 2010, the company has held federal government contracts worth more than $700 million, according to that OFCCP statement.
Through the investigation, the OFCCP determined that the company segregated its production line workforce. It based work assignments on gender stereotypes: putting women in “light duty” jobs and having men do more labor intensive work, the agency alleges. Through interviews with company officials and employees, OFCCP investigators learned women were selected for table inspector jobs, where a majority of the hiring occurred, while men were relegated generally to loader and utility positions, where less hiring took place. The agency also asserts that AmeriQual attempted to create after-the-fact justifications for failing to hire male applicants by making notations on “sticky notes” and other documents and then adding them to files. Those notations did not appear on the original documents that the company provided at the beginning of the investigation, the OFCCP says, adding that AmeriQual also failed to provide specific hiring records during the course of the investigation.
Pursuant to a consent decree signed in mid-January 2017, the company will also extend job offers until 27 male class members from the agreement’s “Priority Employment List” have been hired or until the list is exhausted, whichever occurs first. In addition, it will modify its applicant selection procedures to ensure it do not create barriers to employment, and require all employees involved in its application/selection and hiring process to participate in a minimum of two (2) hours of EEO training. ALJ Morris D. Davis entered an order approving the consent decree on February 1, 2017.
Apex Systems, LLC. Apex Systems, LLC, a staffing firm specializing in information technology, life sciences, and healthcare, signed an agreement in November 2017 promising to pay $148,500 to resolve OFCCP allegations that it against 82 qualified black applicants who applied, and were not hired, for “Recruiter” positions at the contractor’s Atlanta, Georgia establishment. The period of alleged discrimination was January 1, 2012 through December 31, 2013. Under the agreement, signed by agency officials in December 2017, Apex will also extend six job opportunities and revise its selection procedures and conduct related training for HR personnel, managers and supervisors to ensure that this violation does not recur. It has also agreed to remedy cited recordkeeping violations.
Crossmatch Technologies. In early January 2017, Crossmatch Technologies, a leading biometric identity management solutions company, agreed to pay $49,305.29 to resolve allegations of compensation discrimination at its Palm Beach Gardens, Florida headquarters. An OFCCP compliance review found that the federal contractor discriminated against 13 women by paying them less than their male counterparts. Under the agreement, Crossmatch will also make pay adjustments and revise its compensation policies and procedures to ensure that this alleged violation does not recur. The period of alleged discrimination is October 1, 2013 to the date of agreement.
John Q. Hammons Hotels Management, LLC. The former employer of the employees at World Golf Village Resort Hotel, John Q. Hammons Hotels Management, LLC, entered into a conciliation agreement in late January 2017, in which it agreed to pay a total of $47,000 to resolve allegations of hiring discrimination at its St. Augustine, Florida facility. According to the OFCCP, the hotel and hospitality services establishment discriminated against 75 qualified women who applied for “Banquet Set Up & Housekeeping Utility” positions, from January 1, 2013 through December 31, 2013, and were not hired. Under the agreement, Atrium Hospitality LP, current owner and operator of World Golf will also extend 5 job opportunities to eligible class members as positions become available.
LandCare USA, LLC. To resolve allegations of hiring discrimination at its Las Vegas, Nevada facility, LandCare USA, LLC (formerly known as Trugreen Landcare) a residential and commercial landscaping company, agreed to pay $161,899. The OFCCP asserts that the company, from May 1, 2012 through December 31, 2013, discriminated against 243 qualified Non–Hispanic applicants who applied for “Laborer Non–Driver” positions and were not hired. Pursuant to an October 2016 conciliation agreement, the contractor will also extend 29 job offers and will immediately cease using the challenged selection procedures, practices, and/or policies which the OFCCP maintains disparately affected the hiring of non–Hispanic applicants for the positions at issue.
Medline Industries, Inc. In January 2017, Medline Industries Inc., a surgical and medical instrument manufacturing and distributing company, signed a conciliation agreement in which it promised to pay just under $100,000 to resolve OFCCP allegations that discriminated against 44 male applicants for line assembly positions and against 53 female applicants for packager positions at its Waukegan, Illinois, facility. Under the agreement, the contractor will also extend two male and three female job opportunities and will review and evaluate policies affecting hiring selection process. The period of alleged discrimination is April 1, 2011 through March 31, 2012.
Splunk, Inc. Agreeing to provide $2.7 million in back pay, Splunk, Inc, a software company that specializes in collecting, analyzing and storing machine generated big data, entered into a conciliation agreement to resolve OFCCP claims that, from August 1, 2010 through July 31, 2012 , it discriminated against 872 African American and Asian applicants who applied for “Technical Professional,” “Senior Technical Professional,” and “Administrative Professional” positions and were not hired. Under the January 19, 2017 agreement, the company will also extend 11 job offers and hire an independent expert (subject to OFCCP approval) to review and evaluate its hiring and recruitment practices.
Unifirst Corporation. UniFirst Corporation, a workplace uniform and laundry services company, entered into a conciliation agreement with the OFCCP in late January 2017 to resolve two sets of allegations. First, the contractor agreed to pay $75,000 to resolve charges that it discriminated against 17 women at its Charlotte, North Carolina facility by disproportionately assigning them to lower paying “Job Group 7 Production” positions while males were hired into higher-paying Job Group 7 Production positions. UniFirst will also extend 7 job opportunities with retroactive seniority to eligible class members who return to work for the company, Second, the company will pay $116,505.76 to settle claims it discriminated against 494 men who applied for Job Group 7 Production positions and were not hired at its Charlotte, North Carolina facility, and will extend 6 job opportunities. In addition, UniFirst will revise its policies and procedures. The period of alleged discrimination in both cases is September 1, 2009 through February 28, 2014.
Answering a question of first impression in representation proceedings, the NLRB granted in part an employer’s appeal from an order of a regional director denying its motion to require union counsel to withdraw because of a conflict of interest. The employer’s motion was based on its contention that because union counsel had previously represented it in another matter, counsel suffered from a disqualifying conflict of interest under the Maryland Lawyers’ Rules of Professional Conduct. The regional director denied the employer’s motion, after determining that he lacked the authority under Section 102.177 of the Board’s Rules and Regulations to grant the relief sought.
No so, said the Board in Supreme Airport Shuttle LLC. The employer appealed, urging the Board to direct the General Counsel to initiate an investigation of its allegations. The Board determined that the regional director, pursuant to the authority delegated by the Board to regional directors with respect to representation proceedings and subject to the Board’s review, has the authority to decide whether the relief sought by the employer was warranted, independent of the disciplinary procedure established by Section 102.177, which is administered by the Board’s General Counsel.
In an unfair labor practice proceeding, an administrative law judge, subject to the Board’s review, has the authority to disqualify a party’s counsel based on an impermissible conflict of interest. The Board found no sound reason for taking a different approach here. Accordingly, the Board concluded that it has an institutional interest in policing and preserving the integrity of its own proceedings, regardless of their nature. As a result, the Board reversed the regional director’s ruling and ordered him to reconsider the employer’s motion and conduct any investigation deemed necessary in order to decide the motion.
State right-to-work. On February 6, 2017, Missouri Governor Eric Greitens signed Senate Bill 19 making Missouri the 28th right-to-work state, another in a litany of recent victories for “right-to-work” proponents. Only the Northeast and the West have so far avoided successful right-to-work legislation at the state level, but New Hampshire is poised to be next, with a bill reportedly having passed the state senate. Under the Missouri law, effective August 28, 2017, employers are barred from requiring employees to become, remain, or refrain from becoming a member of a labor organization or to pay dues or other charges required of labor organization members, including any payments to charities or third parties in lieu of dues or other charges as a condition of employment.
National right-to-work. Last week, two Republican lawmakers introduced the “National Right-to-Work Act.” The bill, H.R. 785, introduced by Representatives Joe Wilson (R-S.C.) and Steve King (R-Iowa), would amend the National Labor Relations Act and the Railway Labor Act to remove language permits agency shop agreements. “At least 80 percent of Americans are opposed to forcing employees to pay dues as a condition of their employment, and our bill would protect workers by eliminating the forced-dues clauses in federal statute,” Wilson said in a statement.
Opponents say the measures have nothing to do with the right to work, Representatives Bobby Scott (D-Va.) and Peter DeFazio (D-Or.) said in a statement that although states are permitted to pass such anti-union legislation, this bill would “create an unfunded federal mandate that overrides a state’s wishes by requiring private labor organizations to support free riders without limitation.” Scott and DeFazio saw the bill as “a backdoor attempt” to bankrupt labor unions by forcing them to provide services for people who do not pay dues.
Calling the bill “a direct attack on workers and their families, by weakening unions’ ability to collectively bargain and negotiate for good wages and benefits,” Scott and DeFazio cited studies showing that “diminishing unions leads to lower wages and salaries for union and non-union workers alike. This is why wages are lower in so-called right to work states than those that are not.”
Public sector agency fees. Meanwhile, on February 6, the Center for Individual Rights filed a lawsuit against the state of California and the California Teachers Association on behalf of eight California public school teachers and the Association of American Educators. The teachers are again challenging California’s “agency fees” law. CIR previously represented other teachers in Friedrichs v. California Teachers Association, which raised the same issue and which resulted in an equally divided, non-binding U.S. Supreme Court opinion after the death of Justice Scalia last year. The gist of the suit is that public sector agency fees violate the First Amendment by forcing teachers to pay annual fees to the union, even if they are not a member.
According to a CIR press release, California is one of 23 states that require public employees to pay (reduced) union fees, even those who have expressly opted out of union membership. The eight teacher plaintiffs in CIR’s complaint in Yohn v. CTA have political and moral objections to policies on which unions spend their money. Stressed CIR in announcing the new lawsuit, “[w]ith judicial nominations now moving forward, it is imperative to have the issue ready for the full Supreme Court to consider. Questions of fundamental rights—like the right to free speech and free association as laid out in this case—deserve a final and binding decision from the Court.”
Should President Trump’s nominee for the Supreme Court, Neil Gorsuch, be confirmed, he is widely expected to provide the stand-in for Scalia’s anticipated fifth vote that would overturn the Court’s 1977 precedent in Abood v. Detroit Board of Education that allowed agency shop arrangements.
Union membership rate. As pointed out by my colleague David Stephanides last month, the union membership rate failed to advance in 2016. The Bureau of Labor Statistics announced January 26 that the rate was 10.7 percent in 2016, down 0.4 percent from 2015. In 2016, the number of wage and salary workers belonging to unions was 14.6 million, down 240,000 from 2015 (in 1983, the first year for which comparable data are available, the union membership rate was 20.1 percent). The public-sector union membership rate (34.4 percent) was more than five times higher than the private-sector rate (6.4 percent).
Plus, the NLRB reported January 31 that the number of union-filed representation petitions fell to 1299 in FY 2016, down from 1490 in FY 2015, a significant drop. Over 73,000 eligible employees voted in FY 2016, down from over 91,000 in 2015.
Once again, it appears that the revised election rules governing representation-case procedures (the “quickie” election rules to which many employers strenuously objected), which became effective in April 2015, are having little impact on feared union gains. Although unions won 72 percent of the petitioned-for elections, up from 69 percent in FY 2015, with the drop in union-filed petitions and the fall-off in eligible voter participation, any possibility for gains evaporated.
Union avoidance industry. A well-known and oft-cited article in the British Journal of Industrial Relations published in 2006, The Union Avoidance Industry in the United States, tracked this “industry,” composed of “consultants, law firms, industry psychologists, and strike management firms,” and claimed it was then worth “several hundred million dollars per year.” Both the ability to resist unionization and to undermine union strength overall are the ends the industry seeks, and it appears—notwithstanding the fearmongering from the industry that occurred during the eight years of the Obama Administration—that its efforts continue to be successful. But what will the industry do when it doesn’t have unions to kick around—and profit from—any longer?
The House, on February 2, passed a joint resolution of disapproval that would block the Labor Department’s controversial so-called “blacklisting” rule that implements President Obama’s Fair Pay and Safe Workplaces Executive Order. The 236-187 vote fell mostly along party lines, with three Democrats joining Republicans to approve the resolution and one Republican siding with Democrats who gave it a thumbs-down. Given that the Senate, like the House, is dominated by Republican lawmakers, and President Trump said he would sign it, the final rule is on the way out.
H.J. Res. 37 uses a procedural move under the Congressional Review Act that permits Congress to pass a resolution of disapproval to prevent, with the full force of the law, a federal agency from implementing a rule or issuing a substantially similar rule without congressional authorization.
Disclosing labor violations. The final rule on the chopping block, among other things, requires prospective contractors to disclose violations of 14 basic workplace protections from the last three years, including those addressing wage and hour, safety and health, collective bargaining, family and medical leave, and civil rights protections. It also bars federal contractors from enforcing mandatory pre-dispute arbitration agreements as to workers’ claims of sexual assault or civil rights violations.
Not rewarding violators. House Education and the Workforce Committee Ranking Member Bobby Scott (D-Va.) opposed the resolution, saying that it would dismantle Obama’s Fair Pay and Safe Workplaces Executive Order and its assurance that taxpayer funds are not awarded to government contractors who willfully and repeatedly engage in labor law violations, such as wage theft or maintaining unsafe workplaces.
Scott said it’s imperative that contractors bid on a level playing field when they compete for contracts. “Unfortunately, this Resolution would effectively reward contractors who cut corners, endanger the rights and safety of their workers, and studies show, compromise quality,” Scott said on the Senate floor. “Although most federal contractors obey labor laws, studies by GAO, the Senate HELP Committee and others document that federal contractors with histories of serious, willful, and repeated violations of labor, employment and non-discrimination laws continue to be rewarded with federal contracts.”
Filling the data gap. “The rule implementing the Executive Order on Fair Pay and Safe Workplaces does not add any extra layers of review,” Scott said, “rather it would fill the data gap by requiring contractors to disclose whether they have violations of 14 long-standing labor laws, including the Fair Labor Standards Act, the Occupational Safety and Health Act, the Vietnam Era Veterans Readjustment Assistance Act, and non-discrimination laws.” Scott also noted that the final rule only applies to contracts over $500,000, which are not “Mom and Pop” operations.
Trump vows to sign the resolution. The Trump White House, expressing approval of five joint resolutions now working their way through Congress, including this one, had this to say about the “blacklisting” rule: “The rule would bog down Federal procurement with unnecessary and burdensome processes that would result in delays, and decrease competition for Federal government contracts. Rolling back this rule will also help to reduce costs in Federal procurement.”
The Trump Administration said it is “committed to reducing onerous regulatory burdens on America’s businesses and using existing authorities to continue enforcing the Nation’s workplace laws.”
The NLRB reported January 31 that the number of union-filed representation petitions fell to 1299 in FY 2016 (Oct. 1, 2015 to Sept. 31, 2016), down from 1490 in FY 2015. However, unions won 72 percent of the petitioned-for elections, up from 69 percent in FY 2015. Over 73,000 eligible employees voted in FY 2016, down from over 91,000 in 2015.
There were 172 decertification petitions filed over the same period, with employers winning 61 percent of the elections. In FY 2015, there were 176 decertification petitions, with employers winning 59 percent of the elections.
Representation petitions filed by employers rose to 25 in FY 2016 from 21 in FY 2015. Unions won 32 percent of the elections versus 23 percent in 2015.
Once again, it appears that the controversial revised election rules governing representation-case procedures (the “quickie” election rules), which became effective April 14, 2015, are having little impact. With the drop in union-filed petitions and the fall off in eligible voter participation, any possibility for gains evaporated.
Also reported this month, the union membership rate failed to advance in 2016. The Bureau of Labor Statistics announced January 26 that the rate was 10.7 percent in 2016, down 0.4 percent from 2015. In 2016, the number of wage and salary workers belonging to unions was 14.6 million, down 240,000 from 2015. The public-sector union membership rate (34.4 percent) was more than five times higher than the private-sector rate (6.4 percent).
Perhaps the new administration’s anticipated construction boom will advance these numbers in the unions’ favor. Indeed, labor leaders meeting with President Trump last week came away encouraged. Infrastructure improvements and pipeline construction do point to many long and short-term jobs, and labor leaders are eager to start work.