AGC's Human Resource and Labor News - October 14, 2014 / Issue No. 5-2014 (Print All Articles)

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AGC Offers New Construction-Focused Anti-Harassment DVD and Webinar

AGC is excited to announce the release of a new anti-harassment DVD called Diversity Rules: Harassment Prevention, Sensitivity & Correction Training for Construction Workers and Supervisors (“Diversity Rules”). Diversity Rules is one DVD with two training videos designed to aid construction employers with harassment prevention, sensitivity and correction training. One video is targeted for an audience of supervisors and the other is targeted for an audience of non-supervisors.

AGC is excited to announce the release of a new anti-harassment DVD called Diversity Rules: Harassment Prevention, Sensitivity & Correction Training for Construction Workers and Supervisors (“Diversity Rules”). Diversity Rules is one DVD with two training videos designed to aid construction employers with harassment prevention, sensitivity and correction training. One video is targeted for an audience of supervisors and the other is targeted for an audience of non-supervisors.

Employment lawyers from the law firm Fisher & Phillips LLP helped create the videos. They will also lend their expertise in an AGC webinar on November 4 titled Building the Best Harassment Prevention & Training Program for Your Construction Company. The webinar will cover use of Diversity Rules and other best practices in equal employment practices training. For more information on the webinar or to register, visit the AGC website.

The Diversity Rules videos discuss the laws that protect workers from harassment and discrimination, how harassment and discrimination can affect the workplace, and various ways that harassment and discrimination can occur, including references to social media and texting. The videos replace AGC’s top-selling DVDs Crossing the Line and Drawing the Line.

At just under 19 minutes, the video for non-supervisors is short enough to be presented during an on-the-job toolbox session. Vignettes cover topics such as sexual harassment (including sexual orientation and transgender status), age harassment, gender harassment (including family responsibilities), racial harassment and religious harassment. The video for supervisors includes all of the scenarios in the non-supervisor video, plus three additional scenarios that show supervisors how to handle tough conversations with workers about harassment and how to avoid inadvertently discriminating against workers. Its duration is 33 minutes, 14 seconds. The videos were filmed on a construction jobsite and are equipped with Spanish-language closed-captioning that the trainer can turn on or off.

During the webinar, attorneys Bert Brannen and Celia Joseph will use various scenarios from the video to guide attendees through the process of training non-supervisors on harassment prevention and sensitivity on the jobsite. Techniques for supervisory training will also be shared, as supervisors are often the trusted confidant of workers and the first line of defense for construction employers.

Click here to register for the webinar and obtain a copy of the DVD.


New VETS-4212 Report Replaces VETS-100

On Sept. 25, the U.S. Department of Labor’s Veterans’ Employment and Training Service (VETS) published a final rule that impacts federal contractors and subcontractors that hire and employ veterans under provisions of the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA).

On Sept. 25, the U.S. Department of Labor’s Veterans’ Employment and Training Service (VETS) published a final rule that impacts federal contractors and subcontractors that hire and employ veterans under provisions of the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA). The final rule rescinds the regulations applicable to federal contracts and subcontracts entered into before December 1, 2003, because those regulations are now obsolete. In addition, the final rule revises the regulations that outline the reporting requirements applicable to federal contracts and subcontracts of $100,000 or more entered into or modified after Dec. 1, 2003, by changing the manner in which federal contractors report on their employment of veterans. The new rule goes into effect on Oct. 27, 2014. Covered contractors must comply beginning with the annual report filed in 2015.

The final rule revises the VETS-100A Report and renames it the VETS-4212 Report. The VETS-100 Report will no longer be used. The new report requires contractors to report specified information on protected veterans in their workforce in the aggregate, using the same categories currently used for the Employer Information Report (EEO-1), rather than for each category of veterans protected under the statute.

General Reporting Requirements

The new report also requires contractors and subcontractors to provide the total number of employees in their workforces by job category and hiring location; the total number of such employees, by job category and hiring location, who are protected veterans; the total number of new hires during the period covered by the report; the total number of new hires during the period covered by the report who are protected veterans; and the maximum and minimum number of employees of such contractor or subcontractor during the period covered by the report. Contractors and subcontractors must complete a report for each hiring location.

Reports must be filed between August 1 and September 30 of each year following a calendar year in which a contractor or subcontractor held a covered contract or subcontract. While AGC supported the changes outlined in the proposed rule because of its ability to reduce the administrative burden on construction contractors, AGC suggested in written comments that VETS allow contractors to comply either one year after the effective date of the final rule or at the start of the contractor’s next Affirmative Action Program cycle, whichever is later. VETS acknowledged but declined the recommendation by stating that the two obligations are separate and have never been aligned.

Depending on the number of employees, contractors may be required to submit the report electronically. Contractors and subcontractors doing business at one hiring location may complete and submit a single report using the web-based filing system on the VETS website. Contractors and subcontractors doing business at more than 10 locations must submit their reports in the form of an electronic data file in accordance with the instructions for filing the report. In these cases, state consolidated reports count as one location each. Contractors and subcontractors with 10 or fewer hiring locations may file their reports in paper format.

Definitions Specific to Construction

In the final rule, VETS used several construction industry examples to help construction contractors better under the requirements for compliance. For example, in its definition of employee, VETS explained that an employee “does not include any person who is hired on a casual basis for a specified time, or for the duration of a specified job (for example, persons at a construction site whose employment relationship is expected to terminate with the end the employees work at the site).” VETS further explained that “persons temporarily employed in any industry other than construction, such as temporary office workers, mariners, stevedores, lumber yard workers, etc., who are hired through a hiring hall or other referral arrangement… are not covered.”

With regard to properly categorizing construction workers for the report, VETS defined craft workers as “individuals in positions that include higher skilled occupations in construction such as building trades craft workers and their formal apprentices.” Other shared examples include boilermakers, brick and stone masons, carpenters, electricians, painters, glaziers, pipe layers, plumbers, pipefitters and steamfitters, plasterers, roofers, elevator installers, earth drillers and derrick operators. Mechanics, such as electronic equipment repairers, are also included in this category. Bridge and lock tenders, truck drivers and forklift operators fall into the “operatives” category while construction laborers fall under “laborers and helpers.”

In addition, VETS specified that contractors may use the same definition of establishment as defined by the instructions for completing the EEO-1 Report. In most cases, this is a single physical location. For locations involving construction, VETS explained that “it is not necessary to list separately each individual site, project, field, line, etc., unless it is treated by the contractor as a separate legal entity.” Contractors should list as an establishment only those relatively permanent main or branch offices which are either:

  1. Directly responsible for supervising such dispersed activities; or
  2. The base from which personnel and equipment operate to carry out these activities. (Where these dispersed activities cross state lines, at least one such establishment should be listed for each state involved.)

Flow Down Requirement

In addition to the Equal Opportunity Clause, each covered contractor or subcontractor must submit reports in accordance with the following reporting clause, which must be included in each of its covered government contracts or subcontracts as well as modifications, renewals, or extensions thereof, if not included in the original contract.

For additional information, please contact Tamika Carter at cartert@agc.org.


OFCCP Joins EEOC in Considering Gender Identity Discrimination Part of Sex Discrimination

The U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) has issued a new directive to provide guidance on the agency’s approach to employment discrimination on the basis of gender identity or transgender status. In Directive 2014-02, OFCCP clarifies that it considers discrimination on the basis of gender identity or transgender status to be a form of sex discrimination prohibited by Executive Order 11246.

The U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP) has issued a new directive to provide guidance on the agency’s approach to employment discrimination on the basis of gender identity or transgender status. In Directive 2014-02, OFCCP clarifies that it considers discrimination on the basis of gender identity or transgender status to be a form of sex discrimination prohibited by Executive Order 11246.

OFCCP’s interpretation is expressly intended to follow the position of the Equal Employment Opportunity Commission (EEOC) in its interpretation of sex discrimination under Title VII of the Civil Rights Act of 1964. In a 2012 case called Macy v. Holder, the EEOC held that treating someone differently because the person is transgender is by definition sex discrimination because it is “related to the sex of the victim” in violation of Title VII.

“In accordance with Macy v. Holder and the Title VII case law on which it is based,” states the new directive, “OFCCP continues to fully investigate and seek to remedy instances of sex discrimination that occur because of an employee’s gender identity or transgender status.” When conducting such investigations, the agency adheres to the existing Title VII framework for proving sex discrimination, as outlined in the Federal Contract Compliance Manual.

OFCCP notes that the directive deals with discrimination on the basis of gender identity only as a form of sex discrimination and not as a stand-alone protected category. As reported earlier, the latter – along with sexual orientation – is the subject of an executive order recently issued by President Obama. The executive order requires OFCCP to issue regulations on that subject within 90 days of the order’s July 21 date. AGC will continue to monitor developments.


Final Rule for Federal Contractor Minimum Wage Issued

The U.S. Department of Labor’s Wage and Hour Division (WHD) released its final rule implementing Executive Order 13658 (EO), which establishes a minimum wage of $10.10 per hour for direct federal prime contractors and subcontractors at all tiers.

The U.S. Department of Labor’s Wage and Hour Division (WHD) released its final rule implementing Executive Order 13658 (EO), which establishes a minimum wage of $10.10 per hour for direct federal prime contractors and subcontractors at all tiers. That $10.10 minimum wage must be adjusted annually for inflation. The new minimum wage will take effect on direct federal agency contracts entered into on or after Jan. 1, 2015. Federally-assisted contractors are not affected. The final rule will be published in the Federal Register on Oct. 7.

WHD incorporated a significant number of AGC recommendations the association submitted in comments to the proposed rule. In the final rule—pursuant to AGC’s recommendation—WHD:

  • Provides additional clarification and examples of covered contracts and contract-like instruments;
  • Provides additional clarification and examples of covered workers and covered work;
  • Excludes subcontracts for construction materials, supplies and equipment;
  • Excludes Fair Labor Standards Act (FLSA)-covered workers who spend less than 20 percent of their time working on or in connection with a covered contract;
  • Includes additional outreach efforts to notify contractors of minimum wage increases to the passive notice methods proposed;
  • Clarifies the standard for debarment under the rule as that within the Federal Acquisition Regulation (FAR) debarment process;
  • Requires contracting agencies, if appropriate, to ensure the contractor is compensated only for the increase in labor costs resulting from the annual inflation increases in the EO minimum wage beginning on Jan. 1, 2016; and
  • Clarifies how the EO applies to “indefinite delivery, indefinite quantity” (IDIQ) contracts.

Federal contractors should pay close attention to how WHD clarifies how the rule applies to IDIQ contracts. For example, while the master IDIQ contract entered into prior to Jan. 1, 2015, does not fall under the rule, task order contracts contractors entered into on or after January 1, 2015 are subject to the rule. However, WHD is encouraging, but not requiring, contracting agencies to bilaterally modify existing contracts, as appropriate, to include the minimum wage requirements of this rule when such contracts are not otherwise considered to be a “new contract” under the rule.

Lastly, and perhaps most significant and worthy of repeating, federal agencies must compensate contractors for the annual inflation increases in the minimum wage. As a result, federal contractors are entitled to an adjustment by federal agencies where the annual inflation increase to the minimum wage was not covered by the existing contract award.

For more information, please contact Jimmy Christianson at christiansonj@agc.org or Tamika Carter at cartert@agc.org.


Year-to-Date Collective Bargaining Yields Average First-Year Increase of 2.3 Percent

The AGC-supported Construction Labor Research Council (CLRC) has released its second report of the year on collective bargaining settlements in the industry. Settlements reported between January and September 2014 resulted in an average first-year wage-and-benefit increase of 2.3 percent or $1.14.

The AGC-supported Construction Labor Research Council (CLRC) has released its second report of the year on collective bargaining settlements in the industry. Settlements reported between January and September 2014 resulted in an average first-year wage-and-benefit increase of 2.3 percent or $1.14. For newly negotiated multiyear agreements, the average second-year increase was 2.6 percent or $1.35, and the average third-year increase was 2.4 percent or $1.32. The percentage of settlements with no increases negotiated during the latest period – 8 percent – was the same as that found in 2013 but less than the 13 percent found in 2012.

Looking at regional differences on a percentage basis, CLRC reports that the lowest average first-year increase – 1.6 percent – came from the New England Region (CT, MA, ME, NH, RI, VT) and the Southeast Region (AL, FL, GA, KY, MS, NC, SC, TN, VA), while the highest – 3.0 percent – came from the Southwest Pacific Region (AZ, CA, HI, NV). Looking craft-by-craft percentages, the craft with the lowest average first-year increase – 1.7 percent – was the Painters, and the craft with the highest – 3.4 percent – was the Operating Engineers.

CLRC further reports that the trend toward negotiating shorter-term agreements that occurred between 2008 and 2011 continues to subside. Fifty-seven percent of agreements negotiated so far this year were for one year, as compared to 60 percent in both 2012 and 2013, and 68 percent in 2011. Likewise, the percent of settlements with terms of three years or more – 35 percent – has increased slightly this year.

The full report, which contains additional information and graphs, has been sent to the Union Contractors e-Forum and will soon be posted in the Labor & HR Topical Resources area of AGC’s website under the main category “Collective Bargaining” and subcategory “Collective Bargaining Agreement Data.” An updated report is scheduled for release in December.

AGC’s collective bargaining chapters are reminded to please send settlements information to CLRC at clrc@clrc.biz regularly and promptly after completion of bargaining. Chapters and members are also reminded that CLRC is also available to assist with custom projects, such as analyses of local market share, contract language costs, union vs. nonunion wage and benefits comparisons, and wage and benefits benchmarks. For more information about these services, please call CLRC directly at (202) 347-8440.


First National Private Insurance Exchange to Serve the Commercial Construction Industry Begins Offering Coverage Quotes

“The AGC Alternative,” the first of its kind, nation-wide private insurance exchange to serve the commercial construction industry, begins offering quotes today to firms belonging to AGC of America, association officials announced.

“The AGC Alternative,” the first of its kind, nation-wide private insurance exchange to serve the commercial construction industry, begins offering quotes today to firms belonging to AGC of America, association officials announced. The private exchange, developed in collaboration with Willis North America, a unit of Willis Group Holdings, the global risk advisor, insurance and reinsurance broker, features comprehensive insurance coverage from Aetna, MetLife and Group Vision Service as part of its introductory suite of benefits.

Stephen E. Sandherr, the association’s chief executive officer, noted that the new private exchange was designed by Willis for AGC to reduce costs and the administrative burdens for association members that provide insurance benefits for their employees. “Because the exchange offers a broader range of options than typically available to individual firms, employers and their employees will get more of the benefits that meet their particular needs,” he added.

Read the full release here.


Guidance Issued for Locating Missing Participants in Terminated Defined Contribution Plans

The Employment Retirement Income Security Act requires plan fiduciaries to make reasonable efforts to locate missing participants or beneficiaries so that they may direct the distribution of their plan accounts. As a result, the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA) recently published Field Assistance Bulletin No. 2014-01, which lays out the steps fiduciaries of a defined contribution plan must take to locate missing participants before making distributions following a plan termination

The Employment Retirement Income Security Act requires plan fiduciaries to make reasonable efforts to locate missing participants or beneficiaries so that they may direct the distribution of their plan accounts. As a result, the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA) recently published Field Assistance Bulletin No. 2014-01, which lays out the steps fiduciaries of a defined contribution plan must take to locate missing participants before making distributions following a plan termination.

The employer’s first responsibility in terminating the plan is to notify participants that the plan is being terminated and that their benefits will be distributed. This initial notification may be done using certified mail or by electronic notification. If the participant does not respond to the notice, or if the plan fiduciary has a reason to believe that the plan does not have the most current address, then the fiduciary should take additional steps to locate the participant. The additional methods required by EBSA include the use of certified mail, a review of related plan and employer records, an interview with the designated plan beneficiary, and the use of free electronic search tools.

EBSA also identified additional steps for employers who complete the required steps and fail to locate a participant such as using paid Internet search tools, commercial locator services, credit reporting agencies, information brokers, or investigation services. Use of these additional methods should be considered depending on the amount in the participant’s account and the cost of using such methods. If these methods fail, EBSA recommends rolling the participant’s funds into an individual retirement account (IRA) as a first option, or opening an interest-bearing bank account. Transferring the funds to a state unclaimed property fund may also be necessary if the fiduciary can’t find an IRA provider who will take the rollover funds.


Secondary Employer’s Trespass & Nuisance Claims Against Union Are Not Preempted by Federal Labor Law

A shopping mall owner may bring state law claims for trespass and nuisance against a union that waged an unruly protest against a mall tenant’s use of nonunion subcontractors, the U.S. Court of Appeals for the Ninth Circuit (AK, AZ, CA, ID, MT, NV, OR, WA, HI, Guam) has held. The court rejected the position of the union and of the Seventh Circuit that such the state law claims are preempted by the federal Labor Management Relations Act (“LMRA”).

A shopping mall owner may bring state law claims for trespass and nuisance against a union that waged an unruly protest against a mall tenant’s use of nonunion subcontractors, the U.S. Court of Appeals for the Ninth Circuit (AK, AZ, CA, ID, MT, NV, OR, WA, HI, Guam) has held. The court rejected the position of the union and of the Seventh Circuit that such the state law claims are preempted by the federal Labor Management Relations Act (“LMRA”).

The dispute arose when retailer Urban Outfitters, a new tenant at the Brea Mall in Brea, CA, contracted with nonunion subcontractors to renovate its store in advance of its opening. Carpenters Local 803 sent dozens of union members to privately owned common areas in front of the store on several occasions to conduct a protest. The union’s activities allegedly included marching, loudly chanting, blowing whistles, kicking a hold in a construction barricade, banging picket signs against mall railings, catcalling female patrons, and other disruptive conduct. The activities violated the mall’s rules for speech-related activities on its property and for public use of common areas. The union notified the mall owner (“Mall”) that it planned to continue its picketing and protests against the presence of a “rat” contractor until the Mall either shut down the construction or forced Urban Outfitters to do so.

The Mall filed a complaint for trespass and nuisance in state court. The union argued that the case belonged in federal court and that the state claims were really disguised federal claims for unlawful secondary boycott activity under LMRA §303 and were pre-empted by the LMRA. The case was eventually removed to federal district court, which agreed with the union. The appeals court, however, reversed.

The court of appeals conducted a painstaking review of preemption doctrines and their application to the present case. In summary, the court held that the Mall’s claims were not preempted under either the “field preemption” or “conflict preemption” doctrines. Field preemption occurs in rare instances where federal law occupies an entire field. The Seventh Circuit has held that §303 – which grants neutral employers harmed by unlawful secondary activity the right to sue a union for economic damages – completely preempts state claims related to secondary boycotts. The court here disagreed, finding that §303 “does not does not so fully occupy the field such that any claim related to secondary boycotts must be brought under § 303 or not all.” In assessing application of the conflict preemption doctrine, the court assessed whether the Mall’s claims conflict with §303 or would frustrate effective implementation of federal labor law. It found no conflict, given that the Mall’s claims for trespass and nuisance touch “interests deeply rooted in local feeling and responsibility” and “concern only the application of time, place, and manner restrictions to raucous and threatening picket activity.” Accordingly, the court remanded the case back to the district court for consideration of the Mall’s claims.

Retail Prop. Trust v. Carpenters, Case No. 12-56427 (9th Cir., 9/23/14).


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