AGC's Human Resource and Labor News - July 9, 2009 / Issue No. 3-09 (Print All Articles)

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AGC Webinar 8/13: RIFs, Lay-Offs & Furloughs in Construction: Avoiding the Pitfalls

Construction HR professionals have been burdened with the responsibility of properly handling reductions-in-force (RIFs), lay-offs and furloughs; sometimes at a moment's notice.  These situations can be difficult to handle legally, practically, and emotionally.

Construction HR professionals have been burdened with the responsibility of properly handling reductions-in-force (RIFs), lay-offs and furloughs; sometimes at a moment's notice.  These situations can be difficult to handle legally, practically, and emotionally.

On Thursday, August 13, 2009, from 1:30 PM - 3:00 PM EDT, labor and employment law attorney Bert Brannen of Fisher & Phillips, LLP, and construction-industry HR expert and consultant Doug Mure will take a tag-team approach to explaining the legal, practical, and emotional aspects that HR professionals in the construction industry are faced with and how to avoid the pitfalls when forced to release employees.

Registration information will be available soon.

This program has been submitted to HRCI for review.


Registration Open for HR Professionals Conference and Training & Development Conference

Attending the Associated General Contractors of America's (AGC) 2009 Training & Development Conference and HR Professionals Conference provides a unique opportunity for contractor and chapter staff to participate in industry-focused sessions to learn innovative approaches to managing training and human capital.

Attending the Associated General Contractors of America's (AGC) 2009 Training & Development Conference and HR Professionals Conference provides a unique opportunity for contractor and chapter staff to participate in industry-focused sessions to learn innovative approaches to managing training and human capital.

For 2009, both conferences will be held concurrently, October 27 - 29, in Atlanta, Georgia.  Participants will be able to migrate between conference tracks, attend some joint sessions and network with both T&D and HR professionals throughout the event.  With expert speakers providing compliance-related guidance for HR professionals, and interactive sessions that will help T&D professionals sharpen your skills and solve common challenges, you will learn best practices for maximizing efficiency and effectiveness.

See full session descriptions, schedule, and registration information at www.agc.org/hr_td

Don't miss out on the early-bird discount, so register today!


U.S. Department of Labor Schedules Regional Compliance Seminars for Employers

The U.S. Department of Labor's Wage and Hour Division (WHD) and Office of Federal Contract Compliance Programs (OFCCP) have implemented a series of regional compliance seminars in various cities throughout the country.  Each seminar will be offered free of charge to employers.

The U.S. Department of Labor's Wage and Hour Division (WHD) and Office of Federal Contract Compliance Programs (OFCCP) have implemented a series of regional compliance seminars in various cities throughout the country.  Each seminar will be offered free of charge to employers.

OFCCP, responsible for ensuring that contractors doing business with the federal government do not discriminate and take affirmative action, has recently announced details on its upcoming seminars, including one specifically designed for the construction industry, Compliance Assistance for Construction Contractors.  Other OFCCP seminars will address topics such as affirmative action plan development, recruiting veterans and the disabled, internet applicant tracking, and recordkeeping procedures, to name a few.  For a complete list of seminar topics, dates, locations, and registration information, visit the OFCCP Events Web page.

In addition to the above-mentioned seminars, OFCCP is partnering with WHD to present the Prevailing Wage Conference 2009, a two-and-a-half day seminar that will address prevailing wage issues as they relate to the American Recovery and Reinvestment Act of 2009 (ARRA).  The conference will cover such topics as:

  • The Davis-Bacon Act and McNamara O'Hara Service Contract Act;
  • The process of obtaining wage determinations and adding classifications;
  • Compliance assistance and enforcement processes;
  • The process of appealing wage rates, coverage, and compliance determinations; and
  • Contractor and agency requirements under Executive Order 11246, Section 503 of the Rehabilitation Act of 1973, and the Vietnam Era Veterans' Readjustment Assistance Act of 1974.

Only two conferences have been scheduled so far, both in Washington, DC.  The first will be held July 20-22, 2009, followed by a second, identical session July 22-24. WHD and OFCCP are expected to soon announce the dates and locations for six additional prevailing wage conferences so that employers who are unable to travel to Washington, DC, will be able to participate regionally.

To register for one of the Washington, DC, conference sessions, participants should email all contact information along with their AGC affiliation to whdarra@dol.gov.  Additional WHD information related to ARRA can be found on the WHD Web site.  Other resources, such as AGC's Davis-Bacon Manual on Labor Standards for Federal and Federally Assisted Construction and Affirmative Action Manual for Construction are found on AGC's Labor and HR Topical Resources Web page.


DHS to Implement E-Verify Rule but Revoke No-Match Rule

The Department of Homeland Security (DHS) on July 8 announced the Administration's intent to "push ahead with full implementation" of a rule requiring federal contractors to use the E-Verify system to verify employees' authorization to work in the U.S.  The E-Verify rule will apply to federal solicitations and contract awards government-wide beginning September 8.  At the same time, DHS announced its intent to issue a new regulation rescinding a rule establishing procedures for employers to follow upon receipt of a "no-match letter" from the Social Security Administration (SSA) or DHS.

The Department of Homeland Security (DHS) on July 8 announced the Administration's intent to "push ahead with full implementation" of a rule requiring federal contractors to use the E-Verify system to verify employees' authorization to work in the U.S.  The E-Verify rule will apply to federal solicitations and contract awards government-wide beginning September 8.  At the same time, DHS announced its intent to issue a new regulation rescinding a rule establishing procedures for employers to follow upon receipt of a "no-match letter" from the Social Security Administration (SSA) or DHS.

E-Verify

E-Verify, formerly known as the Basic Pilot Program, is an Internet-based system operated by DHS in partnership with SSA that enables employers to verify the employment eligibility of their employees.  Its use is currently voluntary under federal law and required of certain employers under state law in about a dozen states.  Pursuant to an executive order issued by President Bush, the Federal Acquisition Regulation (FAR) Council in November 2008 issued a final rule directing federal contracting officers to mandate contractor use of E-Verify in solicitations issued and contracts awarded after January 15, 2009.  In response to a legal challenge to the rule and in order to give the new Administration time to fully review the matter, the government agreed to suspend the rule on three separate occasions, with the latest delay date of September 8, 2009.  

The rule requires the insertion of a new clause in certain federal contracts and subcontracts.  Prime contracts below the simplified acquisition threshold of $100,000 and those with performance terms of less than 120 days are excluded.  The clause requires the contractor to use E-Verify to confirm employment eligibility of all newly hired employees hired during the contract term and all current employees assigned to work on a federal job within the U.S.  It also allows, but does not require, the federal contractor to use E-Verify to confirm eligibility of all employees, regardless of whether they are assigned to work on a federal job.  Currently, use of E-Verify to confirm anyone other than a new hire (including applicants and current employees) is prohibited.  Click here for DHS's list of Frequently Asked Questions (FAQ's) for Federal Contractors and E-Verify.  Click here for more information about critical components of the rule.

The rule applies only to employers with direct contracts with the federal government and, via a flow-down requirement, their subcontractors.  It does not apply to employers working only on federally funded projects or on other projects not under contract with a federal agency.  DHS's July 8 announcement states that the rule "extends use of the E-Verify system to covered federal contractors and subcontractors, including those who receive American Recovery and Reinvestment Act (ARRA) funds."  Presumably, DHS intended to refer only to direct federal contracts receiving ARRA funds rather than to all ARRA-funded contracts, as neither the E-Verify rule nor the ARRA itself extends the mandate to the latter.

Based on the latest announcement, it seems that the government now plans to implement the rule regardless of the pending lawsuit.  It is uncertain whether the court will allow the government to proceed as planned or will enjoin implementation.  

Meanwhile, the Senate is also addressing E-Verify.  On the same day that DHS issued its announcement, the Senate approved an amendment to the homeland security appropriations bill that would codify the mandate that federal contractors use the E-Verify system.  The Senate is also considering an amendment that would allow employers to use E-Verify for all employees rather than just new hires. 

No-Match 

The final "no-match rule" was issued by DHS in August 2007 and supplemented in October 2008.  However, it was blocked by court order shortly after issuance and has never taken effect.  A "no-match letter" is a letter from SSA informing an employer that employee Social Security Numbers submitted by the employer do not match SSA records or a letter from DHS indicating a discrepancy calling into question an employee's work authorization.  The rule set forth a safe-harbor process for an employer to follow in order to avoid a finding that its receipt of such a letter gave it constructive knowledge of a worker's illegal status.  The U.S. Chamber of Commerce, the AFL-CIO, and others filed a lawsuit arguing that DHS failed to meet procedural requirements in issuing the rule, leading to a preliminary injunction.  The litigation was still in progress when DHS, now under a new Administration, announced its intent to rescind the rule.

Although AGC did not join in the lawsuit, AGC raised concerns with DHS about certain shortcomings in the safe-harbor process and about misleading content of a standard cover letter that DHS intended to insert in all no-match letters.  While the safe-harbor process in the final rule continued to contain shortcomings, it did provide employers with needed guidance about how to respond to a no-match letter.  At this time, it is unclear whether DHS or SSA will issue any new guidance.  AGC will monitor and report on any developments.  In the absence of any new guidance, however, employers that receive a no-match letter are advised to carefully follow the instructions provided in letter so as to avoid discrimination and document abuse violations, to consider following the safe-harbor process as evidence of good-faith compliance, and to seek the advice of legal counsel as needed.  For more information on the safe-harbor process and guidance on how to protect your company, click here.  

Again, this issue could be affected by efforts in Congress.  The Senate has also just added an amendment to its homeland security appropriations that would prohibit any funds provided by the legislation from being used to rescind the no-match rule.  If the amendment is included in the final bill passed by Congress, DHS would be prevented from withdrawing the rule, and the fate of the rule will again fall on the litigation.

Additional Information and Resources

AGC will monitor all related litigation and legislation and will report on significant developments.

Meanwhile, further guidance on immigration compliance is available in an MP3 download of a live educational session held at AGC's Annual HR Professionals Conference in June 2008.  An immigration law update will also be provided at AGC's next HR Professionals Conference, which will take place October 27-29, in Atlanta, GA.  Click here for conference details and registration.  For additional resources and for information on immigration reform efforts, click here.


Federal Government Makes Employers Subject of Immigration Enforcement with I-9 and E-Verify Audits

In recent weeks, the Department of Homeland Security (DHS) has begun fulfilling its promise of investigating employers who hire illegal workers by initiating two major steps: conducting audits of employers' I-9 forms and preparing for increased monitoring of the E-Verify System.

In recent weeks, the Department of Homeland Security (DHS) has begun fulfilling its promise of investigating employers who hire illegal workers by initiating two major steps: conducting audits of employers' I-9 forms and preparing for increased monitoring of the E-Verify System.

As mentioned in the AGC article, DHS to Focus on Prosecuting Employers Who Hire Illegal Workers, the Immigration and Customs Enforcement Division of DHS (ICE) has notified several hundred companies of the intent to audit their I-9 forms.  Employers chosen for the administrative audit received a Notice of Inspection (NOI) with instructions to present all original I-9 forms and supporting documents within three (3) days along with the company's hiring records.  According to a July 1 press release, ICE issued these notices to 652 businesses nationwide, compared to 503 notices issued in all of 2008.  In the press release, ICE identified the 652 employers as those resulting from "leads and information obtained through other investigative means."  Review AGC's Seven Critical Steps for Surviving an I-9 Audit for guidance once an NOI is received.

ICE isn't the only division of DHS tasked with handling employer relations when it comes to immigration compliance.  The U.S. Citizenship and Immigration Services division of DHS (USCIS) has announced its plans to use a new system to monitor the use of the E-Verify system.  The new Compliance Tracking and Management System (CTMS), which is intended to alert employers of potential issues and misuse of E-Verify in order to correct any deficiencies, will be used to identify such things as the fraudulent use of Alien numbers, wrongful employee terminations due to tentative non-confirmations, verification of applicants instead of employees, verification of only some employees and failure to use E-Verify consistently, to name a few.  Although USCIS does not have the authority to investigate and prosecute employers or workers based on its findings through CTMS, USCIS may share the information it gathers with ICE as well as other law enforcement agencies in order to build a case against an employer.

Employers are encouraged to be proactive in developing a system for using E-Verify before a circumstance arises.  A first step is to review the basic guidance provided by USCIS with expert counsel to outline a specific set of best practices, such as:

  • Providing E-Verify basic compliance training and I-9 training for all E-Verify users;
  • Running and evaluating reports on E-Verify use on a regular basis and sharing the information with an individual who is not involved with E-Verify operations;
  • Having outside auditors and legal counsel review the process to assess exposure and concerns;
  • Establishing and maintaining safeguards to prevent use of the E-Verify process for unlawful discrimination;
  • Creating and implementing procedures for handling a possible E-Verify review by USCIS, including contacting legal counsel; and
  • Conducting integrated, annual I-9 and E-Verify internal audits.

As immigration enforcement and monitoring becomes a more pressing concern for companies across the country, it is important for employers to become aggressive in developing and executing Best Practices for staying compliant with current immigration laws.

Some information in this article is provided by Greenberg Traurig, LLP.


Form I-9 Valid After June 30 Expiration Date

On June 26, 2009, the U.S. Citizenship and Immigration Services (USCIS), a division of the Department of Homeland Security, announced that the current Form I-9 will continue to be valid for use beyond its expiration date of June 30, 2009.

On June 26, 2009, the U.S. Citizenship and Immigration Services (USCIS), a division of the Department of Homeland Security, announced that the current Form I-9 will continue to be valid for use beyond its expiration date of June 30, 2009.

Although the current form has the expiration date printed in its upper, left-hand corner, USCIS is in the process of seeking approval for continued use of the form.   Until then, employers may continue to use the expired form in its current format.  After approval and once a new form has been created with a new expiration date, employers will have the option to use either form, as long as it displays the revision date of February 2, 2009, which is printed in the bottom, right-hand corner of the form.

As of April 3, 2009, all U.S. employers must use the February-revised Form I-9 to verify the employment eligibility of newly hired employees and employees with expiring employment authorizations.  This mandate was originally scheduled for implementation on February 2, 2009, but was delayed in response to a request from the new Administration to allow time for further review.

Additional information and a copy of the Form I-9 can be found on the USCIS Web site.


DOL Issues Guidance on Davis-Bacon Requirements for Stimulus-Funded Projects

In an All-Agency Memorandum issued on May 29, 2009, the U.S. Department of Labor (DOL) Employment Standards Administration's Wage and Hour Division (WHD) has provided guidance to contracting agencies on the applicability of Davis-Bacon labor standards to federal and federally-assisted construction work funded in whole or in part under the American Recovery and Reinvestment Act of 2009 (ARRA).  The memorandum provides a summary of the prevailing wage labor standards applicable to construction projects funded under Division A of the ARRA, highlights federal agencies' responsibilities in implementing Davis-Bacon labor standards, and provides links to online resources for additional information.

In an All-Agency Memorandum issued on May 29, 2009, the U.S. Department of Labor (DOL) Employment Standards Administration's Wage and Hour Division (WHD) has provided guidance to contracting agencies on the applicability of Davis-Bacon labor standards to federal and federally-assisted construction work funded in whole or in part under the American Recovery and Reinvestment Act of 2009 (ARRA).  The memorandum provides a summary of the prevailing wage labor standards applicable to construction projects funded under Division A of the ARRA, highlights federal agencies' responsibilities in implementing Davis-Bacon labor standards, and provides links to online resources for additional information. 

As a result of specific language in the ARRA, all requirements of the Davis-Bacon Act apply to construction projects that receive ARRA funds, with an added provision that "projects funded directly by or assisted in whole or in part by and through the Federal Government" as a result of the ARRA must also comply.  This designation requires all ARRA projects, whether fully or partially funded or assisted, to comply with the prevailing wage requirements of the Davis-Bacon Act.  This provision was made to deter contractors from intentionally dividing ARRA projects into smaller, separate contracts in order to avoid Davis-Bacon coverage on smaller parts of a large project, according to the memorandum.  This is consistent with DOL's "longstanding view a project consists of all construction necessary to complete the building or work regardless of the number of contracts involved so long as all contracts awarded are closely related in purpose, time and place."  However, DOL explains, this does not mean that Davis-Bacon coverage on an ARRA project "lasts in perpetuity."  DOL understands that many major construction activities occur in segregable phases that are distinct in purpose, time, or place and advises federal agencies to examine every situation independently. 

Furthermore, the memorandum explains, if a construction project funded under multiple statutes including ARRA funds, and one of the statutes exempts the project from Davis-Bacon compliance, then the project must meet the requirements of the Davis-Bacon Act for the entire project.  However, special exemptions and limitations apply to certain tribal contracts and to projects funded under ARRA Department of Housing and Urban Development (HUD) appropriations for Assisted Housing Stability and Energy and Green Retrofit Investments.

Federal agencies are responsible for including applicable wage determinations in the construction contract and for "the correct application of Davis-Bacon wage determinations to bid solicitations, contracts, and assistance agreements," the memorandum confirms.  As for ARRA-funded ongoing construction projects that were awarded prior to ARRA, or for which construction had already started, the memorandum states that the contracting agency "should insert the applicable wage determination(s) in relevant contracts and assistance agreements effective as of the date the ARRA assistance is approved for the project."  However, no new wage determination is needed if an ongoing project already subject to Davis-Bacon standards begins to receive ARRA funding unless the assistance is for new work not covered by the existing contract. 

The memorandum further confirms that it is the responsibility of all contractors and subcontractors on covered projects to pay covered employees the prevailing wages listed in the wage determination included in the contract, to pay such wages on a weekly basis, and to submit weekly certified payroll records to the contracting or administering agency.  Accordingly, while the memorandum does not directly address the issue, contractors are reminded to include appropriate clauses and wage determinations in subcontracts for ARRA-funded projects, including those awarded prior to ARRA-funding. 

The memo advises that contractors and employees with questions about the application of Davis-Bacon requirements to a particular project should direct their initial inquiries to the federal agency funding the project but notes that DOL "retains final coverage authority."  The memorandum also points out online information resources, including DOL's online database of wage determinations, Prevailing Wage Resource Book, and recently created ARRA Web site.  Links to these and other Davis-Bacon resources, such as AGC's Davis-Bacon Manual on Labor Standards for Federal and Federally Assisted Construction are found on AGC's Labor & HR Topical Resources Web page.


Minimum Wage to Increase on July 24

The minimum wage established by the Fair Labor Standards Act (FLSA) will increase from $6.55 per hour to $7.25 per hour on July 24, 2009.

The minimum wage established by the Fair Labor Standards Act (FLSA) will increase from $6.55 per hour to $7.25 per hour on July 24, 2009.

The increase is the final phase of a three-part phase-in mandated by legislation enacted in 2007.  The first phase took effect on July 24, 2007, increasing the hourly rate from $5.15 to $5.85.  The second phase took effect on July 24, 2008, increasing the hourly rate from $5.85 to the current rate of $6.55.

Many states have established a minimum wage rate higher than the federal rate.  Where an employee is subject to both the state and federal minimum wage laws, the employee is entitled to the higher of the two wage rates.  For information on state minimum wage laws, click here.

Every employer of employees subject to the Fair Labor Standards Act's minimum wage provisions must post a notice explaining the Act in a conspicuous place at all work sites.  Employers can download a poster satisfying the requirement from the U.S. Department of Labor's Web site.  Employers can also purchase printed and laminated Consolidated Federal Employment Laws posters from AGC, with a discount for members.  The poster satisfies the posting requirements of 10 different federal labor and employment laws, including the FLSA. 

For more information on the FLSA, visit the Labor & HR Topical Resources page of the AGC Web site.  Select the category "Compensation" and the subcategory "Fair Labor Standards Act."

For more information, contact Tamika C. Carter at (703) 837-5382 or cartert@agc.org.


AGC Persuades Supreme Court to Clarify Federal Remedies For Violations of Collective Bargaining Agreements

At AGC's urging, the U.S. Supreme Court has agreed to hear Granite Rock Company v. International Brotherhood of Teamster, a case that arose after that international union prevailed upon one of its locals to go on strike in violation of a newly ratified agreement between the local and the Granite Rock Company, a longstanding member of the AGC of California and AGC of America.   The case provides an opportunity for the Court to clarify the scope of Section 301 of the Labor Management Relations Act, which gives the federal courts exclusive jurisdiction over "[s]uits for violations" of collective bargaining agreements, and preempts any state law that purports to govern either the interpretation or the enforcement of such agreements.

At AGC's urging, the U.S. Supreme Court has agreed to hear Granite Rock Company v. International Brotherhood of Teamster, a case that arose after that international union prevailed upon one of its locals to go on strike in violation of a newly ratified agreement between the local and the Granite Rock Company, a longstanding member of the AGC of California and AGC of America.   The case provides an opportunity for the Court to clarify the scope of Section 301 of the Labor Management Relations Act, which gives the federal courts exclusive jurisdiction over "[s]uits for violations" of collective bargaining agreements, and preempts any state law that purports to govern either the interpretation or the enforcement of such agreements. 

The international caused the unlawful strike to pressure the company to waive any liability that either the international or any one of its locals might have for any misconduct that had occasioned an earlier strike (called while the parties were negotiating the terms of the new agreement).  The international had actively participated in the collective bargaining process, providing strategic advice to the local, sending one of its agents to the bargaining sessions and even asserting that it had the authority to negotiate without the local's approval, but the international did not become a party to the new agreement.  The question that the case therefore raises, and that the Court has now agreed to address, is whether the company can nevertheless hold the international liable for causing the local to strike in violation of the no-strike clause included in the new agreement.

The lower federal courts have taken several different positions on Section 301.  Some have suggested that it gives the federal courts jurisdiction only over cases brought against the parties to collective bargaining agreements.  Others have taken the slightly broader view that the federal courts also have jurisdiction over cases brought against non-parties if they are accused of violating rights arising out of such agreements.   Still others have held that the federal courts have jurisdiction over anyone who wrongly interferes with the relationship between the parties to such agreements.

The case is an important one because the preemptive effect of Section 301 is well-established.  Unless the federal courts have broad jurisdiction to fashion appropriate remedies for wrongful interference with the contractual relationships between unions and employers, the parties will have no legal recourse for such interference.  In a friend-of-the-court brief that AGC filed with the Supreme Court, AGC warned the great danger of creating "a practical 'no-man's land' in federal labor law."

The Court has yet to set the briefing schedule for the case, which case also raises questions about the scope of any arbitration that the federal courts can order.  Most likely, the parties will brief and argue the case in the fall, and the Court will render its decision sometime after the first of the year.

For more information, contact Mike Kennedy at (703) 837-5335 or kennedym@agc.org.


AGC Holds First Regional Meeting with Carpenters and Operating Engineers

The first AGC-NCAII regional meeting took place at the Carpenters training facility in Philadelphia, PA, on May 28.  Members and staff from the Philadelphia Builders Chapter, Contractors Association of Eastern Pennsylvania, and AGC of New Jersey attended, along with the general presidents and regional business managers of the Carpenters and Operating Engineers unions, AGC Union Contractors Committee Staff Associate Denise Gold, and NCAII Executive Vice President Ray Poupore.  The NCAII - an abbreviation of National Construction Alliance II - is a partnership of the Carpenters and Operating Engineers international unions.  The "II" was added after the Laborers dropped out of the alliance last year.

The first AGC-NCAII regional meeting took place at the Carpenters training facility in Philadelphia, PA, on May 28.  Members and staff from the Philadelphia Builders Chapter, Contractors Association of Eastern Pennsylvania, and AGC of New Jersey attended, along with the general presidents and regional business managers of the Carpenters and Operating Engineers unions, AGC Union Contractors Committee Staff Associate Denise Gold, and NCAII Executive Vice President Ray Poupore.  The NCAII - an abbreviation of National Construction Alliance II - is a partnership of the Carpenters and Operating Engineers international unions.  The "II" was added after the Laborers dropped out of the alliance last year. 

The regional meetings are intended to provide AGC chapters with an opportunity to communicate union contractors' local and regional concerns directly to the union leaders and to engage in a dialogue to solve problems together.  "The purpose is for us to find out what we can do to help make your companies more successful," Poupore stated in opening comments.  Operating Engineers General President Vince Giblin added, "We need to be real partners, not partners of convenience just when we need to be."  The Operating Engineers are changing their approach from "strong arm tactics" to helping signatory contractors be more competitive, according to Giblin.   Echoed Carpenters General President Doug McCarron, "If you're successful, we're successful….We need to come to you to see what you need to get the work."

Contractors raised a number of concerns, such as frustration with local union business agents that give better concessions to nonunion general contractors who subcontract to union subcontractors than they give to union general contractors, and the resulting loss of jobs for owners aware of the practice, the excessive cost of using union specialty contractors and repercussions of subcontracting to nonunion specialty contractors, loss of jobs due to the Carpenters' poor image related to jurisdictional disputes, and problems with project labor agreements.

"We're union contractors because we want to be union contractors," explained David Panichi, Philadelphia Builders' Chapter Chairman of the Board, "but it's very difficult today to sell our product to the owners….You're going to lose us through this process."  Giblin responded by relating his efforts to bring about a culture change in his organization and to get rid of poor local leaders, including his recent take-over of a New Jersey local.  "We've looked the other way too long in this organization," he said.  Some local leaders have "been rocked to sleep."  They had it "too good" for a long time and are now facing rough times for the first time.  "All they've ever done is beat you guys up with a billy club.  That's got to stop," he said, adding that cleaning up the organization is a slow process.  "We're making progress, but it takes time."

McCarron suggested that labor and management could tackle mutual challenges together in the same manner accomplished with safety years ago.  Labor and management worked together with owners 25-30 years ago to fix the safety problem, and "we can change this too, if we put our collective minds together," he said.  "We had a goal and stuck to it.."  We need to have a vision and work toward it, he continued, with or without the specialty trades.

Both Giblin and McCarron expressed growing respect for Mark Ayers, the president of the AFL-CIO's Building and Construction Trades Department, but continued disdain for the building trades in general.  Ayers is a "good guy" and means well, they said, but many of the general presidents in the Department are too concerned about ceremony and have lost their way.

Both general presidents also expressed interest in hearing about problems directly from contractors.  At times in the meeting, the general presidents seemed to be blaming the contractors for failing to bring problems to their attention.  Giblin stated that he would promptly return any contractor's phone call; and, when one highway contractor brought up problems with featherbedding, Giblin told him to call him about such problems in the future and he would look into it.

The next AGC-NCAII meeting is scheduled for July 13 in Chicago, IL.

(L-R) Carpenters Business Manager Ed Coryell, Carpenters General President Doug McCarron, Operating Engineers General President Vince Giblin, and AGC Union Contractors Committee Chairman Jim Clemens


OFCCP to Place Special Emphasis on Construction Industry Compliance

The Office of Federal Contract Compliance Programs (OFCCP), responsible for ensuring that contractors doing business with the federal government do not discriminate and take affirmative action, will soon begin conducting compliance reviews of construction contractors who receive funding and grants from the American Recovery and Reinvestment Act of 2009 (ARRA). 

The Office of Federal Contract Compliance Programs (OFCCP), responsible for ensuring that contractors doing business with the federal government do not discriminate and take affirmative action, will soon begin conducting compliance reviews of construction contractors who receive funding and grants from the American Recovery and Reinvestment Act of 2009 (ARRA). 

According to OFCCP’s Recovery Act Plan, the majority of ARRA funding and grants will provide direct funding or federal assistance to construction projects and “consequently, OFCCP will place a special emphasis on the construction industry.”  Beginning in July 2009, OFCCP will begin to review a minimum of 360 construction contractors and 90 supply and service contractors, including at least 10% of first-time federal contractors.  These reviews will be followed by quarterly compliance evaluations through September 30, 2010.   

To help contractors maintain compliance with the agency’s guidelines, OFCCP plans to host a series of compliance events to be held periodically through the September 30 date, including nine national events and six webinars specifically for federal construction contractors, new federal contractors and contracting officers.  Additionally, OFCCP plans to host 93 regional compliance events, 11 regional forums, and a national Prevailing Wage Conference, which will address prevailing wage issues as they relate to ARRA over two-and-a-half days.

Additional OFCCP compliance resources for construction contractors include AGC's Davis-Bacon Manual on Labor Standards for Federal and Federally Assisted Construction and Affirmative Action Manual for Construction, which can be found on AGC's Labor and HR Topical Resources Web page.


Supreme Court Offers Guidance to Employers Faced with the Dilemma of Potential Competing Discrimination Claims

Resolving a thorny issue faced by employers finding themselves threatened with a discrimination claim regardless of what action they take, the Supreme Court on June 29 held that an employer that acts in a race-conscious fashion to avoid being sued under a disparate-impact theory, must have something more than a good-faith belief that such a suit was likely – otherwise, it has violated Title VII of the 1964 Civil Rights Act.

Resolving a thorny issue faced by employers finding themselves threatened with a discrimination claim regardless of what action they take, the Supreme Court on June 29 held that an employer that acts in a race-conscious fashion to avoid being sued under a disparate-impact theory, must have something more than a good-faith belief that such a suit was likely – otherwise, it has violated Title VII of the 1964 Civil Rights Act.

In Ricci v. DeStefano, 17 white and one Hispanic firefighters who scored highly on a promotional exam sued the mayor of New Haven, Conn., the city and other officials who, citing a fear that minority firefighters would sue, refused to certify the test results. Both the district court and Second Circuit Court of Appeals accepted the city’s stated fears and entered summary judgment for it. But in a 5-4 ruling the Supreme Court reversed, holding that an employer’s mere good-faith belief that it will be sued if it doesn’t undertake a race-conscious move that otherwise would violate Title VII, is insufficient to shield the employer from liability. Instead, an employer facing a potential disparate-impact claim from one side (here, from minority firefighters) must show a “strong basis in evidence” that the remedial action (throwing out the test results) was necessary in order to head off that claim. Otherwise, it has violated Title VII by subjecting the harmed group (here, the white/Hispanic firefighters) to disparate treatment.

Writing for the majority, Justice Anthony Kennedy noted that requiring an employer to show a “strong basis in evidence” for its stated fear of litigation reconciles both the disparate-treatment and disparate-impact provisions of Title VII, and allows violations of one in the name of compliance with the other “only in certain, narrow circumstances.” The standard leaves “ample room for employers’ voluntary compliance efforts” with Title VII, which the Court called “essential to the statutory scheme and to Congress’s efforts to eradicate workplace discrimination.” At the same time, it does not require an employer to act only when there is a “provable, actual violation” of Title VII, before it can avail itself of a defense to liability.

Ricci should be considered fully by any employer facing, as Justice Souter characterized it in the oral argument, a “damned if you do/damned if you don’t” dilemma exposing it to potential Title VII liability regardless of what it does. The majority’s opinion made clear that it is not questioning employers’ ability to broaden opportunities for all groups to apply for promotions or to participate in the promotional process. Nor does it forbid, the Court said, an employer from considering how to design a test or hiring practice to provide a fair opportunity for all individuals regardless of race – before the test is given or the practice implemented. But once such processes have been established, selection criteria announced, and tests given, employers may not invalidate them without having a “strong basis in evidence” that, had they not, they would face a disparate-impact claim.

Dissenting from the ruling, Justice Ginsburg and three colleagues would have affirmed the city’s actions as proper, or at a minimum, remand back to the lower courts for determination of whether New Haven had a “strong basis in evidence” for its fear that minority firefighters would sue.

Editor’s noteThis article was written by guest author Michael F. Smith, Shareholder, Butzel Long, and reprinted with permission.  Mr. Smith can be reached by e-mail at smithm@butzel.com or by telephone at (202) 454-2860.


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