Alabama Employment Law

An Employee’s Insistence on Enforcing “Rules” Can Be Insubordination.

Robert C. Lockwood
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Employees who disregard workplace directives in favor of their interpretation of the “rules” may be insubordinate.

I frequently encounter employees who think that workplace rules make them bulletproof.  Usually, these employees have memorized their employer’s handbook and know it better than the Human Resources staff.  They then insist that any workplace action must be taken in compliance with the “rules.”  And, they think that any action which contradicts the “rules” must be invalid.  One employee recently learned the hard way that his insistence upon the “rules” amounted to insubordination, which justified termination of his employment.  Veasy v. Sheriff of Palm Beach County, No. 17-13174, 2018 WL 3868674 (11th Cir. Aug. 14, 2018).

Wilbur Veasy was employed as a corrections officer by the Palm Beach County Sheriff for 25 years.  Over the course of those 25 years, he was written-up for insubordination six times.  He is African-American.  On February 5, 2013, Mr. Veasy was directed to submit to a random urine drug screen.  In accordance with written policy, Mr. Veasy appeared at the Sheriff’s Internal Affairs Office to submit his urine sample.  But, despite the language of the written policy, the Sheriff’s Office had not accepted urine samples at Internal Affairs for more than four (4) years.  Thus, upon arrival, Mr. Veasy was directed to drive his personal car to a third-party contractor’s office to submit a sample.

Mr. Veasy refused.  He insisted that the Sheriff Department’s policy did not require him to drive his personal vehicle to a testing facility.  Mr. Veasy requested an “official vehicle” to drive to the testing facility.  A sergeant denied Mr. Veasy’s request, and ordered that Mr. Veasy drive to the testing facility.  When Mr. Veasy refused, the matter was referred to the Sheriff.    The Sheriff gave Mr. Veasy two options: either drive to the test site in his personal vehicle or be placed on administrative leave.  Mr. Veasy responded that his “2007 red four door Tacoma is not going,” and the  Sheriff placed him on administrative leave.  Mr. Veasy was ultimately terminated for refusing to comply with a direct order and for refusing to submit to a random drug screen.

Mr. Veasy sued for race discrimination.  The Eleventh Circuit assumed that he could prove a basic (prima facie) case of discrimination.  But, Mr. Veasy could not rebut the Sheriff’s legitimate nondiscriminatory reason for termination:  insubordination.  Mr. Veasy tried to argue that he had not actually violated a work rule.  After all, the Sheriff’s written policy said to arrive at Internal Affairs ready to submit a sample, and he did just that.  The Eleventh Circuit was not persuaded.  The issue was not whether Mr. Veasy violated the written rule, but whether he was insubordinate when he refused two direct orders to travel to the third-party contractor’s office.  The Eleventh Circuit found he was insubordinate, and affirmed dismissal of his discrimination claim.

Overzealous employers might be tempted to read Veazy to permit them to terminate an employee for insubordination any time the employee refuses a direct order.  To quote Lee Corso:  “Not so fast, my friend.”  There are numerous factors that need to be considered before any employee is terminated.  Probably, the most important factor is treatment of other similar employees who refuse direct orders.  So, if an employer only terminates insubordinate employees in a protected class, then the termination might be impermissible.  Veazy is more of a cautionary tale for employees to be careful about their insistence on work rules.

 

 

Federal Contractors: OFCCP Issues Directive on Religious Freedom

Robert C. Lockwood
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The OFCCP issued a directive requiring recognition of religious freedom.

The Office of Federal Contract Compliance Programs (“OFCCP”) has issued a new directive reminding its staff members of their obligation to recognize the religious freedom of federal contractors.  Here’s a link to the new directive:  Directive 2018-3.  Here’s a link the OFCCP press release about the directive:  Press Release.

The directive was issued in response to several recent decisions from the United States Supreme Court on religious freedom, and President Trump’s executive order which “reminded the federal government of its duty to protect religious exercise — and not to impede it.”  Thus, the OFFCP reminded its staff that:

• They “cannot act in a manner that passes judgment upon or presupposes the
illegitimacy ofreligious beliefs and practices” and must “proceed in a manner
neutral toward and tolerant of … religious beliefs.”
• They cannot “condition the availability of [opportunities] upon a recipient’s
willingness to surrender his [ or her] religiously impelled status. ”
• “[A] federal regulation’s restriction on the activities of a for-profit closely held
corporation must comply with [the Religious Freedom Restoration Act].”
• They must permit “faith-based and community organizations, to the fullest
opportunity permitted by law, to compete on a level playing field for …
[Federal] contracts.”
• They must respect the right of “religious people and institutions … to practice
their faith without fear of discrimination or retaliation by the Federal
Government. “

As a practical matter, the new OFCCP directive does not provide much clarity on a key religious issue:  whether government contractors can discriminate against LGBT persons based upon religious beliefs.  Indeed, I previously wrote that President Trump will not rescind President Obama’s Executive Order prohibiting LGBT discrimination:  Trump and LGBT.  For now, government contractors should proceed cautiously if they want take employment actions based upon religious beliefs.

Employer Pays $25K in Arbitration Admin. Fees for $7K FLSA Claim.

Robert C. Lockwood
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Sometimes, the fees associated with arbitration will cost more than the actual claim made by the employee.

Just because you’ve got the right to arbitrate a claim doesn’t mean that you have to arbitrate that claim.  If you’ve read my blog before, you know that arbitration is a great form of alternative dispute resolution for many claims.  But, employers should think carefully before arbitrating employment disputes:  Arbitration Isn’t Always Good for Employers.  In conducting that analysis, one factor for employers to consider is the amount of fees that they will pay to an arbitrator in comparison to the value of the employee’s claim.

In Hernandez v. Acosta Tractors, Inc., No. 17-13057, 2018 WL 3761126 (11th Cir. Aug. 8, 2018), the Eleventh Circuit Court of Appeals confronted an employer who was having second-thoughts about the wisdom of arbitrating a claim under the Fair Labor Standards Act.  (“FLSA”).  Julio Hernandez claimed that his employer, Acosta Tractors, failed to pay him overtime.  Mr. Hernandez sued in federal court and Acosta Tractors moved to dismiss the case because he signed an arbitration agreement.  The judge agreed, and dismissed Mr. Hernandez’s case in favor of arbitration.

Acosta Tractors soon began to experience sticker-shock with the arbitration process.  Mr. Hernandez was one of three employees who were arbitrating FLSA claims.  Acosta Tractors asked the arbitrator to consolidate the three proceedings into one, but the arbitrator refused.  The arbitrator also ordered 29 depositions to be taken in the three separate proceedings.

At this point, I need to be clear:  an arbitrator is essentially a paid judge.  Every time the arbitrator works on a case, he bills the parties for his work — usually at rates of $350.00 per hour or more.  Additionally, if a third-party organization, like the American Arbitration Association is involved, they will charge for their work on the case.  As a result, administrative fees quickly add up.

In Acosta Tractors’ case, it received bills for administrative fees in the amount of $33,100 and $43,640 in the other two cases, and $25,875 in Mr. Hernandez’s case.  At this point, faced with over $100,000 in administrative fees, Acosta Tractors cried “uncle,” and tried to go back to federal court.  It refused to pay the arbitration fees, and asked the federal judge to re-assert control over the case.  But, the judge was not pleased.  He found that Acosta Tractor defaulted in arbitration, and thus was also in default in federal court.  Ultimately, the judge entered a default judgment in Mr. Hernandez’s favor in the amount of $7,293.00.

On appeal, the Eleventh Circuit vacated the judge’s ruling for further consideration.    The Eleventh Circuit found that the trial judge should not have entered a default judgment based solely upon the failure to pay administrative fees in arbitration.  Instead, the Eleventh Circuit directed the trial judge to determine whether Acosta Tractors “acted in bad faith in choosing not to pay its arbitration fees.”  The court suggested that a “good faith inability to afford the arbitration fees” would be a factor in Acosta Tractors’ favor, but also noted that its decision “to abandon arbitration after getting adverse rulings from the arbitrator certainly looks like forum shopping.”

To me, the biggest lesson for employers to learn from Hernandez is:  “look before you leap.”  Arbitration is going to be expensive for everybody involved.  In Mr. Hernandez’s case, Acosta Tractors was billed $25,875 in administrative fees on an overtime claim that was worth $7,293.  With the benefit of hindsight, it looks like Acosta Tractors could have saved money by keeping this FLSA case in federal court.

When is an Employer not an “Employer”? FLSA v. Common Law

Robert C. Lockwood
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The term “employer” has different meanings under the FLSA and common law.

Some British playwrite once wrote:  “That which we call a rose by any other name would smell as sweet.”  I’ve always interpreted that line to suggest that names are not nearly as important as substance or context.  The Eleventh Circuit recently issued an entertaining opinion recognizing this important issue in the employment law arena.  See Garcia-Celestino v. Ruize Harvesting, Inc., No. 17-12866, 2018 WL 3652010 (11th Cir. Aug. 2, 2018)(“Garcia-Celestino II“).  In Garcia-Celestino II, the Court was required to examine the intricacies of the term “employer” — and discuss the differences in that term under the Fair Labor Standards Act (“FLSA”) and the common law.

Judge Rosenbaum began his opinion:  “The English language contains many examples of homonyms —  ‘words that have the same sound and often the same spelling but differ in meaning’ ….”  He then suggested that the terms “employer” and “control” are “legal homonyms” that have “different meanings under the FLSA and the common law.”

Judge Rosenbaum also noted that this was the second time that the case came before the Eleventh Circuit.  Indeed, I wrote about the first Garcia-Celestino opinion, and the significance of control over contract labor here:  Migrant Farm Workers and the FLSA.  In the first Garcia-Celestino opinion, the Eleventh Circuit found that orchard owner Consolidated Citrus was a joint employer under the FLSA with Ruiz Harvesting — the company from which it contracted migrant labor.  But, the court remanded the case to the trial court to determine if Consolidated Citrus was also a joint employer for breach-of-contract purposes under the common law.  The trial court concluded that Consolidated Citrus was an “employer” for purposes of the common law.

Judge Rosenbaum’s opinion in Garcia-Celestino II reversed the trial court and found that Consolidated Citrus was not a joint employer under a breach of contract theory.  In short, Consolidated Citrus was an “employer” for purposes of the FLSA, but not for breach of contract. Under both the FLSA and the common law, “control” over a worker is important for determining whether her or she is employed.  But, the FLSA created “one of the broadest possible delineations of the employer-employee relationship.”  In contrast, a common law analysis “results in a much narrower analytical approach.”  “Under the common law, we must look at only who controls ‘the manner and means’ and ‘the details of the work,’ giving no consideration to ‘mere economic control or control over the end result of the performance.'”

Judge Rosenbaum then conducted an extensive analysis which largely focused on control over the “manner and means” of the migrant workers’ labor.  At the end of that analysis, he (along with Judge Tjoflat and Judge Ungaro) concluded that Consolidated Citrus was not a joint employer of the migrant workers for purposes of the common law.

The Garcia-Celestino saga is a nice microcosm of employment law.  Facts matter.  Claims matter.  The applicable law matters.  Under a single set of facts, a company can be liable as an “employer” under one claim (FLSA), but not liable under another (breach of contract).   With a good understanding of these intricacies, some employers can emerge from a lawsuit smelling like a rose.

 

 

Complaints About Homosexual Discrimination Not Protected by Title VII

Robert C. Lockwood1 Comment
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Employees who complain about homosexual discrimination are not protected by Title VII’s anti-retaliation provisions.

In some areas of the country, federal courts have interpreted Title VII of the Civil Rights Act of 1964 to prohibit discrimination on the base of sexual orientation, including homosexuality.  However, the Eleventh Circuit Court of Appeals, which interprets federal law for Alabama,  has held that sexual orientation is not protected by Title VII.  In December of 2017, the United States Supreme Court declined to review the Eleventh Circuit’s position on this issue.  Here’s a link to a post that I wrote on that decision:  Supreme Court Won’t Review 11th Circuit LGBT Decision.

Although sexual orientation is not protected in the Eleventh Circuit, the court has prohibited discrimination against employees for “failure to conform to gender stereotypes.”  Here’s a link to a previous post that discusses the issue:  LGBT Issues in the Workplace.  In short, employers in the Eleventh Circuit can discriminate based upon sexual orientation, but arguably can’t discriminate because an employee’s manner, attributes, attire, etc. don’t comply with gender stereotypes.  As a result, homosexual employees who suffer discrimination are forced to file claims alleging that they suffered discrimination, not because of their sexual orientation, but because of their failure to conform to gender stereotypes.

In Brakeman v. BBVA Compass, No. 2:16-01344-JEO, 2018 WL 3328909 (N.D. Ala. Jul. 6, 2018), Chief United States Magistrate Judge John Ott discussed these issues in the context of a retaliation claim.  Krystal Brakeman is gay and married to another woman.  She claimed that a co-worker made statements to the effect that Brakeman needed to “talk to Jesus” and “get a man in her life.”  Ms. Brakeman complained to a supervisor about those statements.  Two months later, she was terminated from employment.  Her employer asserted that the termination was based upon separate improper conduct by Ms. Brakeman and a lack of truthfulness during an investigation of that conduct.

Ms. Brakeman sued and asserted several theories, including a claim that she was fired in retaliation for complaining about the homosexual-oriented comments of her co-worker.  Because homosexual discrimination is not prohibited in the Eleventh Circuit, complaints about homosexual discrimination are not protected.  Therefore, Ms. Brakeman argued that she suffered retaliation for complaining about a failure to comply with gender stereotypes.  Judge Ott refused to accept that argument, finding that “a plaintiff cannot ‘bootstrap’ an invalid sexual orientation claim into a viable gender stereotyping claim by asserting that homosexuals failed to comply with gender stereotypes because of their homosexuality, real or perceived. …. To hold otherwise ‘would mean that every case of sexual orientation discrimination would translate into a triable case of gender stereotyping.'”

In short, Judge Ott found that Ms. Brakeman was really complaining to her supervisor about homosexual discrimination.  And, because homosexual discrimination is not prohibited in the Eleventh Circuit, Ms. Brakeman’s complaints were not protected by Title VII’s anti-retaliation provisions.

At this point, there do not appear to be any decisions from the Eleventh Circuit itself addressing retaliation and gender stereotyping.  Nevertheless, Judge Ott’s analysis appears to be a natural extension of the Eleventh Circuit’s position on sexual orientation discrimination.  As a result, at least in the Eleventh Circuit, complaints about sexual orientation discrimination are unlikely to be protected by Title VII’s anti-retaliation provisions.

Arbitration Agreements: The Gifts That Keep On Giving

Robert C. Lockwood
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Arbitration agreements can be binding even if they were signed during a different period of employment.

Diamonds are forever — and so are employment arbitration agreements.  That’s the lesson to be learned from Gillian v. Cowabunga, Inc., No. 2-17-cv-01389-JEO, 2018 WL 2431345 (May 30, 2018).  (For fans of Teenage Mutant Ninja Turtles, I unsuccessfully tried to find a way to work “Cowabunga, Dude!” into the title of this blog post.)

Scarlett Gillian was first employed by Cowabunga from November 2015 to March 2016.  When she was first hired, Ms. Gillian signed an agreement to arbitrate any disputes relating to her employment.  Ms. Gillian quit her job on March 14, 2016, but was re-hired on May 4, 2016.  She did not sign an arbitration agreement when she was re-hired.  Ms. Gillian claimed that she was sexually harassed during her second period of employment and filed suit in federal court.  Cowabunga moved to dismiss that lawsuit and claimed that Ms. Gillian was required to arbitrate any claims because of her prior arbitration agreement.  Ms. Gillian argued that she should not be required to arbitrate because she did not sign a new arbitration agreement when she was re-hired.

United States Magistrate Judge John Ott agreed with Cowabunga.  There appears to be no authority from the Eleventh Circuit Court of Appeals on this issue.  Nevertheless, Judge Ott relied upon decisions from several United States District Court Judges.  His opinion hinged upon the following conclusion:  “Where an arbitration agreement contains express language indicating intent for the agreement to survive termination of employment, parties may be compelled to arbitrate claims arising during subsequent re-employment.”  Gillian, 2017 WL 2431345 at *2.  Ms. Gillian’s arbitration agreement contained an express provision stating that it survived termination of her employment.  Therefore, Judge Ott found that she could be compelled to arbitrate, even though she did not sign a new arbitration agreement when she was re-hired.

Gillian provides employers with another way to avoid lawsuits in federal court.  Of course, if you are a regular reader of my blog, you know that arbitration agreements aren’t always a perfect solution for employers:  Arbitration Isn’t Always Good for Employers.  Nevertheless, if you require your employees to sign an arbitration agreement, you should make sure that the agreement also contains a provision stating that the agreement survives termination of employment.

Title VII, Premarital Sex and the Religious Employer

Robert C. Lockwood
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Employers who terminate employees for premarital sex risk violating Title VII’s rule against pregnancy discrimination.

Title VII of the Civil Rights Act of 1964 and the Pregnancy Discrimination Act prohibit termination of employees because they are pregnant.  But, what if pregnancy is irrefutable evidence of premarital sex?  And, what if a religious employer has beliefs prohibiting premarital sex?  Can that employer terminate the pregnant employee without violating Title VII?  Those are the issues that United States Magistrate Judge Herman Johnson struggled with recently in Kelley v. Decatur Baptist Church, No. 5:17-CV-1239-HNJ, 2018 WL 2130433 (N.D. Ala. May 9, 2018).

Alexandria Kelley was employed by Decatur Baptist Church as a maintenance and child care employee.  She notified her employer in the Summer of 2015 that she was pregnant, and she was terminated shortly thereafter.  When Ms. Kelley sued in federal court, Decatur Baptist moved to dismiss her complaint, and argued that she was terminated because she engaged in sexual conduct outside of marriage — which violates biblical standards.  Judge Johnson denied that motion to dismiss, while leaving open the possibility for dismissal at a later stage of the litigation.

Decatur Baptist provided Judge Johnson with two legal arguments in support of dismissal.  First, the church argued that the “ecclesiastical abstention doctrine” barred Ms. Kelley’s claims.  Under that doctrine, courts do not decide issues connected to “theological controversy, church discipline, ecclesiastical government, or conformity of members of the church to the standards of morals required of them.”  Myhre v. Seventh-Day Adventist Church, 719 Fed. Appx. 926 (11th Cir. 2018).  (I previously wrote about courts’ reluctance to engage in ecclesiastical disputes here:  Ecclesiastical Disputes In Alabama.) Second, Decatur Baptist argued that Ms. Kelley’s claims were prohibited by the “ministerial exception,” which “precludes application of [employment discrimination laws] to claims concerning the employment relationship between a religious institution and its ministers.”  Kelley, 2018 WL 2130433 at *4.

Judge Johnson found that both of the church’s arguments were premature.  While the church claimed that its decision was based upon religious principals, Ms. Kelley’s complaint (which Judge Johnson was required to accept as completely true) alleged that the termination was based solely upon her pregnancy, and had nothing to do with religion.  Therefore, Judge Johnson gave Ms. Kelley the opportunity to engage in discovery in an attempt to provide evidence in support of her claim.

Decatur Baptist will unquestionably move to dismiss Ms. Kelley’s claims after discovery by filing a motion for summary judgment.  At that point, the church will probably also assert an additional fact-based defense — that it terminated Ms. Kelley for engaging in premarital sex, not for getting pregnant.  “Title VII does not protect any right to engage in premarital sex, but as amended by the Pregnancy Discrimination Act of 1978, Title VII does protect the right to get pregnant.”  Hamilton v. Southland Christian School, Inc., 680 F.3d 1316, 1319-20 (11th Cir. 2012).

 

FMLA: Three Strategies for Curbing FMLA Abuse

Robert C. Lockwood
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FMLA abuse can be difficult for employers. But, there are ways to limit that abuse.

In my experience, the majority of employees requesting leave under the Family and Medical Leave Act (“FMLA”) use their leave appropriately.  Nevertheless, there are still a significant number of employees who will use the FMLA as a source of vacation days, instead of a relief for family or medical problems.  Typically, these employees use “intermittent leave” under the FMLA.  The FMLA does not require that all leave for one condition to be taken at one time.  Instead, the act recognizes that some conditions “flare up” intermittently or or require multiple treatments over time.  Therefore, employees are entitled to take leave on those intermittent occasions.

Frequently, employees are granted FMLA leave for such intermittent conditions.  But, what happens if an employee’s “flare ups” always seem to occur on a Monday or Friday?  What can an employer do to ensure that employees aren’t getting a consequence-free day-off when they aren’t really sick?  This is an exceedingly difficult area of the law, and I strongly urge all employers to talk with their lawyer before taking direct disciplinary action as a result of suspected FMLA abuse.  Also, if you suspect FMLA abuse, there are strategies to limit the abuse.

Ask for a Second Opinion.

Just because an employee’s hand-picked physician says there’s a need for intermittent leave, doesn’t automatically mean that the employee is entitled to leave.  Instead, if an employer has  a “reason to doubt” the validity of a medical certification, the employer may require the employee to obtain a second opinion.  The employer gets to select the second doctor, but must also pay for the second opinion.  The selected doctor cannot be one that the employer employs, contracts with or regularly uses.  In short, you can’t sent the employee to the “company doctor” for a second opinion.

If the second opinion disagrees with the the employee’s original opinion, then the employer and employee must work in good faith to select a third doctor, whose opinion will be final.

Use Certification Forms to Your Advantage.

FMLA certification forms are your friend.  Yes, they are unwieldy and confusing.  But, at the end of the day, those forms should tell you exactly what conditions qualify for the employee’s FMLA leave.  Here’s a link to the Department of Labor’s standard forms:  FMLA Forms.  If an employee takes FMLA, make sure their leave matches up with the form.  For example, if the employee’s certification says they will need intermittent leave for migraines, an absence for knee pain probably won’t qualify for FMLA leave.  Hold your employees accountable to the ground stated in their certification.

Ask for a Re-Certification. 

Generally, employers can request re-certification every 30 days, but the request for re-certification can  only be made in connection with an absence by the employee.  But, there is an exception to that general rule that frequently applies in intermittent leave cases.

If the original certification indicates that the minimum duration of the employee’s condition is more than 30 days, you must wait until the minimum duration expires before requesting re-certification.  But, there is also an exception-to-the-exception.  At a minimum, you are entitled to request a re-certification every 6 months in connection with an absence.

Finally, the FMLA permits employers to request re-certification at any time under certain conditions.  First, if the employee asks for an extension of the leave period (for example from three months to six months), a re-certification can be required.  Second, if the circumstances described by the original certification have changed significantly, a re-certification can be required.  There is much debate over whether a change is “significant,” so employers should proceed carefully with this exception.  Finally, if an employer receives information that casts doubt upon the employee’s stated reason for absence or the continuing validity of the certification, the a re-certification can be required.  The most common scenario of a “reason to doubt” occurs when the doctor’s certification says the employee will be in bed all-day during a “flare up,” but Facebook shows him playing golf.

Conclusion

These are just a few of the strategies that employers can use to combat FMLA abuse.    For further ideas, an experienced employment attorney can provide you with valuable guidance.

Service Contract Act: Non-Compliance Can Be Costly

Robert C. Lockwood
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Failure to comply with the Service Contract Act can be expensive for government contractors.

My firm helps government contractors comply with a broad array of regulations imposed by the federal government.  Here is a link to our firm’s new Government Contracts Lawyers web site:  Wilmer & Lee Government Contracts.  Within our government contracts group, I am frequently tasked with assisting government contractors in their efforts to comply with the McNamara-O’Hara Service Contract Act (“SCA”).

The United States Department of Labor (“DOL”) enforces the SCA.  Frequently, the DOL issues press releases when companies agree to pay for violations of the SCA.  Following are a series of press releases issued by DOL this Spring.  Hopefully, they can provide you with some guidance on what not to do in administering an SCA contract.  The title of each release links to the DOL web site.

18-630-ATL.  May 8, 2018.  A company based in my hometown of Huntsville, Alabama agreed to pay $95,000 in back wages to 12 employee for failure to pay prevailing wage rates for work performed on a federal contract.  Y-Tech Services, Inc. categorized employees as aircraft workers when they actually performed the duties of sheet metal employees, which required higher rates.

18-625-BOS. May 8, 2018.  This is actually a Davis-Bacon Act case and not an SCA case.  Gilliam Co. LLC of Franklin, Connecticut was debarred from future federal construction contracts.  Gilliam failed to make required fringe-benefit payments — primarily 401(k) contributions.  Gilliam also took payroll deductions from a non-existent vacation fund, failed to pay employees for their last two weeks of work, and submitted falsified payroll records.  The total amount paid to 12 employees was $125,348.

18-0658-SAN.  May 1, 2018.  United States Auto Club, Inc. (“USAC”) provides emergency roadside assistance to the United States Postal Service.  The SCA contract required that employees be paid $20.84 per hour.  USAC subcontracted the work to Norbert’s Towing Service, which only paid employees half that rate.  As a result, USAC owed 29 employees $377,512 in unpaid prevailing wages; $165,116 in required health and welfare benefits; and, $107,367 in overtime.

18-04650-ATL.  March 29, 2018.  Insight Global, LLC worked as a subcontractor for Hewlett Packard on an information technology contract with the U.S. Department of the Navy.  Insight Global erroneously categorized and paid 14 employee as computer operators, when they actually performed the work of personal computer support technicians.  As a result, Insight Global agreed to pay $354,978 in back wages.

OFCCP: TRICARE Moratorium Extended to 2021

Robert C. Lockwood
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The OFCCP extended a moratorium which excuses TRICARE providers from compliance with affirmative action obligations.

Should TRICARE providers be required to implement affirmative action?  That’s the issue that the United States Department of Labor raised when it issued Directive 2014-01 on March 7, 2014.  Here’s a link to that directive:  DOL Directive 2014-01.  TRICARE is a federal healthcare program that provides benefits to American veterans.  The DOL’s Office of Federal Contract Compliance Programs (“OFCCP”) is responsible for enforcement of the affirmative action obligations imposed upon federal contractors.  Directive 2014-01 effectively imposed a five-year moratorium on requiring TRICARE subcontractors to comply with those obligations.  On May 18, 2018, OFCCP extended that moratorium to May 7, 2021.

Federal laws and regulations require federal contractors and subcontractors to take affirmative steps to ensure equal employment opportunity in their employment processes. When it issued Directive 2014-01, the DOL  recognized a difference of opinion as to who is a covered subcontractor under the law and what obligations the TRICARE subcontractor community has under the law.  Because of that difference of opinion, DOL decided that it would impose the moratorium on enforcement.

The moratorium, however, was set to expire in 2019.  OFCCP’s May 18, 2018 press release extended the moratorium.  Here’s a link to the press release:  May 18, 2018 Press Release.  OFCCP provided the following rationale for extending the affirmative action moratorium:  “Active-duty and retired service members, and their families, too often have difficulty accessing health care. There is evidence suggesting that continued uncertainty regarding the extent to which OFCCP requirements apply to TRICARE providers exacerbates these challenges. With the approaching expiration of the moratorium adding additional uncertainty, this extension will provide OFCCP time to receive feedback from stakeholders, relieve uncertainty, and give OFCCP an opportunity to evaluate and address legislation that may be enacted on this issue.”