Posts Tagged ‘P.C.’

New York Attorney General Holds Contractor Accountable for Lax Oversight of Subcontractor’s Prevailing Wage Practices

by HDlawblog Posted: Friday, 6/28/2013

A New York City contractor recently agreed to pay nearly $1 million dollars to settle a prevailing wage investigation into complaints that one of its subcontractors on a public housing project underpaid 31 masonry workers and bricklayers.  The contractor also agreed to pay $100,000 in back wages to four of its laborers, plus $50,000 in costs and fees to the state.

The New York Attorney General’s prevailing wage investigation revealed that for over a year, the contractor’s subcontractor paid masonry workers and bricklayers between $16 to $22 dollars per hour, with no overtime premium, for work that should have been paid at a prevailing wage rate of between $53.55 to  $72.44, plus supplemental benefits.  The investigation further revealed two instances where the contractor failed to classify or list employees in its certified wage payroll reports and two other instances where employees were misclassified at pay rates below what they should have been paid.

The New York Attorney General’s office said that in addition to requiring government contractors to pay wages and benefits comparable to local norms for a given trade, federal and state prevailing wage laws also hold general contractors responsible for underpayments by their subcontractors.

The settlement mandated that the contractor’s contracts with any subcontractor on public or private construction projects state that compliance with labor laws is a material term of the contract and that the subcontractor may be terminated if it does not fix labor law violations brought to its attention.

According to New York’s Attorney General, his office will hold contractors accountable for their prevailing wage violations and for their lax oversight of subcontractor’s practices.

Lesson:  Contractors need to pay attention to their subcontractor’s payment practices.

This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.

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Posted in Public Works | No Comments »

Pennsylvania Jury Finds in Favor of Plaintiff in Pregnancy Discrimination Case

by HDlawblog Posted: Monday, 4/22/2013

In the matter of Blake v. Purolite Corp. et al., the plaintiff filed a pregnancy discrimination case in the United State District Court for the Eastern District of Pennsylvania wherein she alleged that she was terminated because of her pregnancy in violation of her rights under Title VII of the Civil Rights Act of 1964, the Pregnancy Discrimination Act, and the Pennsylvania Human Relations Act.   After a four day trial, the jury found that the plaintiff’s pregnancy was a determinative factor in the defendant’s decision to terminate her employment and returned a verdict in her favor.  Specifically, the jury awarded the plaintiff compensatory damages in the amount of $25,000.00 and punitive damages in the amount of $125,000.  Additionally, the Court later issued a memorandum stating that the plaintiff was also entitled to $11,098.12 in back pay.

Pregnancy discrimination cases appear to be on the rise.  The attorneys at Harmon & Davies are here to assist employers with pregnancy discrimination charges.

This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.

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Posted in Labor & Employment, Pregnancy Discrimination | No Comments »

Worker at Poultry Plant Killed by Falling Into Unguarded Machinery

by HDlawblog Posted: Tuesday, 4/16/2013

The death of a poultry plant worker who was killed after falling into an unguarded piece of machinery resulted in an OSHA investigation and proposed fines totaling $160,000.00 for 43 alleged violations.  Thirty-seven of the forty-three alleged violations were classified as “serious” for hazards that could lead to serious injury or death of a worker that the employer knew about or should have known about.  The serious violations included not identifying mechanical hazards or providing training for employees as well as failing to provide workers with personal protective equipment or to conduct monthly inspections of self-contained breathing apparatuses. OSHA also claimed that the company: obstructed exit routes, did not use machine guarding on equipment and exposed workers to a variety of hazards such as shock, burn, crushing, tripping, falling, and amputation.

In issuing the fines OSHA stressed the importance of management taking immediate action to eliminate the hazards identified during the investigation before another worker is killed.

The attorneys at Harmon & Davies are here to assist employers with creating safety plans, employee safety training, formulating safety procedures and policies, and contesting OSHA citations.

This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.

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Word to the Wise: Steer Clear of Overtime Violation Claims

by HDlawblog Posted: Monday, 4/8/2013

The $20.9 million settlement between Rite Aid Corp. and assistant managers and co-managers for overtime pay violations under the Fair Labor Standards Act and various state laws, which settlement was approved by the U.S. District Court for the Middle District of Pennsylvania earlier this year, should serve as a stark reminder that employers need to be ever vigilant in their efforts to properly classify and pay employees.

The attorneys at Harmon & Davies are here to assist employers with all of their labor and employment related needs, including their overtime and break policies and the proper classification of employees.

This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.

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Posted in FLSA, Labor & Employment | No Comments »

Appellate Court Says Four Black Female Carpenters May Proceed with Sex Bias and Retaliation Claims against Carpenters & Joiners Union

by HDlawblog Posted: Monday, 2/18/2013

In the case of Butt v. Carpenters & Joiners of Am., the Third Circuit recently held that the U.S. District Court for the Eastern District of Pennsylvania wrongly dismissed the claims of four black female carpenters who claimed that the Carpenters and Joiners of America discriminated and retaliated against them in making job referrals.

 

The four female carpenters asserted sex discrimination claims under Title VII of the 1964 Civil Rights Act and race discrimination claims under the Civil Rights Act of 1866 against the union, its business manager, and its business agent.  The plaintiffs also asserted Title VII and Section 1981 retaliation claims and at least one of the plaintiffs asserted race and sex bias claims under the Pennsylvania Human Relations Act.

 

The Third Circuit found that the lower court failed to properly consider certain factual issues and therefore the dismissal was improper.  One of the key facts had to do with the union’s agent allegedly telling one of the plaintiffs that “his people” were still out of work when she inquired about work.  The plaintiff interpreted the phrase “his people” to mean white men.  The lower court interpreted this statement to mean that the union’s agent did not identify with black female carpenters.  However, the plaintiff’s interpretation of the comment was the only interpretation that the appellate court could find on the record.  Thus, the appellate court found that the comment was enough to create a factual issue for trial on the discrimination claims.

 

As for the retaliation claims, the lower court took too narrow of a view of retaliation by focusing on retaliatory actions that resulted in a clear change in employment status.  According to the appellate court, the lower could should have also considered acts meant to keep workers from making discrimination complaints.  Here, the plaintiffs claimed that their reduction in hours was in retaliation for their direct complaints to the union, their EEOC discrimination charge against the union and their testimony before a Philadelphia advisory commission.  After two of the plaintiffs testified before the commission, the union’s agent sent the media a letter stating that two women had been laid off in the past because of poor performance.  Although the record contained little information about the letter that was sent to the press, the appellate court held that such action arguably could have sufficed as retaliatory action under the law and therefore the letter raised an issue of fact for trial.

 

This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.

 

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Employer Succeeds in Efforts to Have OSHA Citation Vacated

by HDlawblog Posted: Monday, 2/11/2013

Sometimes it pays to contest an OSHA citation.  Take for example, the case of Sec’y of Labor v. K.E.R. Enters. Inc., where the Occupational Safety and Health Review Commission (“OSHRC”) recently vacated an OSHA citation for a serious violation.  In the K.E.R. Enterprises case, the employer was pressure-testing a water pipe as part of a waterline installation project.  The project foreman noticed a small leak near what is referred to as a restraining gland and instructed two workers to tighten the T-bolts on the restraining gland.  During this process, the pipe exploded, sending fragments flying.  Both of the foreman’s legs were broken and three other workers were injured as a result.

OSHA cited the employer with a serious violation of the Occupational Safety and Health Act’s general duty clause, which is basically the Act’s catchall provision, for exposing its employees to the hazard of being struck by pipe fragments.  Specifically, OSHA blamed the employer for failing to follow the restraining gland’s manufacturer’s installation instructions and for failing to adhere to guidelines in the American Water Works Association’s (“AWWA”)  standards.

The employer successfully contested the citation.  An administrative law judge ruled that the employer’s alleged failure to follow installation instructions and the AWWA’s guidelines did not render the employer liable for the pipe explosion.  Rather the judge found that the employer took proper actions and that there was insufficient evidence to support an assertion that anyone involved should have “recognized that it was a hazard to tighten T-bolts to stop a small leak without first depressurizing the pipe.”

Thereafter, in a petition for review, the Secretary of Labor unsuccessfully argued that the employer’s alleged failure to follow the manufacturer’s instructions or the AWWA’s guidelines  evidenced a violation of the Act’s general duty clause.  However, the commission reasoned that neither the instructions nor the standard contained a safety warning or suggested that failure to comply could lead to injury.  Rather, there was a lack of evidence establishing that the instructions or guidelines established that overtightening the T-bolts could create a hazard of being struck by pipe fragments during a pressure test.

If you are an employer who has been cited for an OSHA violation, the attorneys at Harmon & Davies can assist you with contesting a citation.

This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.

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Pennsylvania Employers Can’t Use Fluctuating Workweek Method to Calculate Overtime

by HDlawblog Posted: Friday, 2/8/2013

A federal court recently held that Pennsylvania law does not allow for the fluctuating workweek method of paying overtime, which means that Pennsylvania employers who compensate non-exempt employees pursuant to this method shoudl revise their practices ASAP.  If they don’t, such employers might find themselves embroiled in overtime class action claims.

Here’s what employers need to know.  Wage and hour requirements are mandated at the federal and state level.  The federal government sets threshold wage and hour requirements, but states can enact more stringent requirements.  For employers, this means that you have to constantly monitor whether you are in compliance with federal wage and hour requirements and state wage and requirements.  For example, the federal minimum wage rate for non-exempt workers is $7.25 per hour.  It just so happens that Pennsylvania’s minimum wage rate is also $7.25 per hour,  but California employers have to pay non-exempt employees more because California’s minimum wage rate is $8.00 per hour.

On the federal level, the Fair Labor Standards Act (“FLSA”) dictates overtime and minimum wage requirements.  The FLSA’s state law equivalent in Pennsylvania is the Pennsylvania Minimum Wage Act (“PMWA”).  The FLSA and PMWA are similar, but not identical.

For example, under the FLSA an employer may compensate non-exempt employees pursuant to the “fluctuating workweek” method of overtime compensation.  Under this method, an employee receives a guaranteed fixed weekly salary for all straight-time earnings, regardless of the number of hours worked, and an additional one-half of the employee’s regular rate for all hours worked over forty in the workweek.  This method lets the employer divide an employee’s weekly salary by the number of hours actually worked to determine the regular rate.  As long as the regular rate is more than the minimum wage, FLSA regulations allow the employer to compensate any hours worked beyond 40 with not less than one-half the regular rate.  Here’s how the fluctuating workweek method works:

Gerald is an exempt employee who receives a weekly salary of $400 dollars.  In week 1 Gerald works 41 hours.  Gerald’s rate of pay for week 1 is 9.76 per hour ($400 divided by 41 hours).  Since Gerald worked one hour beyond 40 in week 1, the employer is only required to pay Gerald $404.88 ($400 plus half of $9.76).  In week 2 Gerald works 50 hours.  Gerald’s rate of pay for week 2 is $8.00 per hour ($400 divided by 50 hours).  Since Gerald worked 10 extra hours in week 2, the employer must pay Gerald $440.00 ($400 plus (10 times half of $8.00).  The advantage to employers is that so long as the regular rate is more than the minimum wage, the employer only has to compensate any hours worked beyond 40 with not less than one-half the regular rate.  So, the more hours the employee works beyond 40 per week, the cheaper the labor rate becomes for the employer.

 

However, in Foster v. Kraft Food Grp. Inc. a federal court recently held that contrary to the FLSA’s regulations, the PMWA’s regulations do not allow payment of only an additional one-half of the regular rate for overtime hours pursuant to the fluctuating workweek method.  Instead, Pennsylvania employees compensated under this method must receive an additional one and one-half of their regular rate for overtime hours.  For example, using the same example used above, in week 2 Gerald would have to be compensated $520 for the week ($400 plus ((1.5 x $8.00) x10).

On the heals of this decision, Kraft Foods Inc. agreed to pay $1.75 million to resolve two proposed class actions filed by employees who alleged that Kraft’s use of the federal fluctuating workweek method to calculate overtime violated the Pennsylvania Minimum Wage Act.  Because wage and hour claims can expose employers to costly class actions, employers should pay careful attention to how they calculate overtime payments.

The attorneys at Harmon & Davies are well versed in wage and hour requirements and routinely defend employers in wage and hour actions.

This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.

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Posted in FLSA, Labor & Employment | No Comments »

Pennsylvania Painting Contractor Faces Nearly Half a Million Dollars in Proposed OSHA Penalties

by HDlawblog Posted: Monday, 2/4/2013

A Canonsburg, Pennsylvania based painting contractor faces nearly half a million dollars in proposed OSHA penalties for alleged safety violations at three of its projects.  The large citation includes 38 alleged violations, including 14 willful and 11 repeat violations at worksites in Slatington, Harrisburg, and Slatedale, Pennsylvania.

The alleged willful violations include failing to properly protect workers from lead exposure and failing to provide fall protection.  The repeat violations relate to employee exposure to lead above the permissible exposure level, a lack of warning signs posted in lead work areas, failure to ensure workers showered at the end of each shift, and failure to provide medical evaluations and fit tests for respirator users.

Additional alleged violations include:

  1. Failure to notify employees of the results of lead monitoring;
  2. Failure to provide employees with initial medical surveillance for lead;
  3. Failure to provide periodic blood tests for employees exposed to lead;
  4. Allowing workers to have or consume food in an area where lead exposure was above the permissible level;
  5. Failing to notify employees in writing of blood lead test results within five days;
  6. A lack of guarding on electrical wiring to prevent accidental contact; and
  7. Failure to ensure that workers wore respirators while blasting with glass media or when exposed to lead in excess of permissible limits.

 

The cited company has been under OSHA’s scrutiny for the past several years, having been inspected five times in the past five years with four of the inspections resulting in citations for serious violations.  As a result of the painting contractor’s alleged refusal to correct hazards, it has been placed on OSHA’s Severe Violator Enforcement Program, which requires targeted follow-up inspections to ensure compliance with OSHA regulations.

This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.

 

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Federal Court Weighs in on Affordable Care Act, the Mennonite Faith, and Birth Control

by HDlawblog Posted: Wednesday, 1/30/2013

A provision of the Affordable Care Act  commonly referred to as the “preventive services mandate” requires employers to provide employee health plans that cover, without cost to the employee, contraceptives, abortifacients, abortion, and sterilization.  In Conestoga Wood Specialties Corp. v. Sebelius, a closely held, secular, for-profit corporation, operated by a family of the Mennonite faith, claimed that compliance with that the Affordable Care Act’s preventive services mandate violated the corporation’s sincerely held religious beliefs.

This raised an issue of first impression for the U.S. District Court of the Eastern District of Pennsylvania as to whether a secular, for-profit corporation has religious rights under the First Amendment.  Although federal district and appeals courts are split on the issue of whether secular corporations have a right to challenge the validity of the preventive services mandate, the Eastern District held that a corporation does not possess such a right based upon: (1) a lack of historical support for the proposition that a secular, for-profit corporation possesses the right to free exercise of religion (in other words, religious rights are purely personal guarantees that have only been extended to individuals); and (2) an adherence to the corporate form.

In the Conestoga Wood case, the corporation unsuccessfully argued that it should be considered the alter egos of its shareholders, all of whom practice the Mennonite faith.  In rejecting this argument, the court stated that it would be entirely inconsistent to allow the shareholders to enjoy the benefits and protections of incorporation while simultaneously piercing the corporate veil for the limited purpose of challenging the preventive services mandate.

The court further reasoned that because the ultimate and deeply private choice to use an abortifacient contraceptive rests not with the shareholders of the corporation, but with the corporation’s employees, any burdens imposed upon the employer by the regulations would be too attenuated to be considered substantial.  Moreover, the court stated that the regulations apply to the employer corporation, not to the shareholders individually.  Accordingly, the court said that whatever burden the shareholders may feel from being involved with a for-profit corporation that provides health insurance that could possibly be used to pay for contraceptives, is too indirect of a burden to be considered substantial under the Religious Freedom Restoration Act.

This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.

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A Quick Reference Guide to Pennsylvania Mechanics’ Lien Laws

by HDlawblog Posted: Thursday, 1/17/2013

Disclaimer:  This fact sheet pertains only to the Mechanics’ Lien Law of Pennsylvania.  Other states, including Maryland, New Jersey, and Delaware have dramatically different Mechanics’ Lien Laws.

What is a mechanics’ lien?  A security interest in the title to a property for the benefit of those who have supplied labor or materials to the property.  In other words, it’s a tool to help contractors, subcontractors, and suppliers ensure payment. 

Obviously subs/suppliers care about mechanics’ lien rights, but what about GCs?  Most contracts with owners require GCs to defend and bond off mechanics’ lien claims.  Therefore, on a basic level you need to know: (1) what mechanics’ liens are; (2) how to avoid them (get a list of all subs/suppliers and make sure everyone is getting paid for the labor and material they supply); (3) how to defend against them (did the claimant follow all the procedures for perfecting a lien within the allotted time?); and (4) how to bond them off.

On rare occasions, a GC might need to file a mechanics’ lien claim to secure its right to payment.  In this event, you need to know how to preserve your claim.

Who can file a lien? General contractors, subcontractors and sub-subcontractors (i.e. contractors and suppliers who have a direct contract with subcontractors).  No one below the level of a sub-subcontractor has lien rights.

When to file a lien?  Subcontractors (but not general contractors) must provide the owner with what is referred to as a formal notice of intent to lien.  This formal written notice must be provided to the owner at least 30 days before the lien claim is filed by a subcontractor or supplier.

All claimants must file their lien claim within six months of the claimant’s last date of work.

How do I determine the last date of work? Time limits to file a claim or serve a formal notice of intent to lien are based on the date of completion of the claimant’s work, not from the date of completion of the entire project.  The work is complete when the claimant has performed the last of the labor or delivered the last of the materials required by the terms of the claimant’s contract.  [Note: claimants cannot tack on additional material or labor to a contract for the purpose of extending the time to file a claim.  It is prudent to count deadlines from the last substantial new work.  Warranty work and repair work may not extend the filing deadlines.]

What must a subcontractor include in its formal notice of intent to lien?

  1. Name of claimant
  2. Name of the person with whom claimant contracted;
  3. The amount claimed;
  4. The general nature and character of the labor or materials furnished;
  5. The date of completion of claimant’s work; and
  6. A description of the property. 

 

What happens after a lien claim is filed?  Within one month after the initial claim filing, written notice of the filing of the lien must be served on the owner, typically by the sheriff.  Thereafter, the claimant has 20 days to serve an affidavit of service with the court.

After the above steps have been taken, no further action is immediately necessary.  However, within two years of filing the claim, the claimant must file a complaint to enforce its claim.

Does a mechanics’ lien require any pre-filing before construction? No.

Can a public project be liened? No.  Liens are not allowed for labor or material furnished for a purely public purpose.

What is the minimum amount for a lien claim?  $500.00.

Can lien rights be waived?  Yes, but certain procedures need to be followed as Pennsylvania has declared lien waivers to be void as against public policy.

On all projects, a subcontractor can waive its rights to file a lien only if the general contractor provides a bond guaranteeing payment to subcontractors, i.e. a payment bond.  As long as a payment bond is in place, a general contractor may file a stipulation against liens with the prothonotary’s office in the county where the project is located.  To be effective, a stipulation against liens should be filed: (1) prior to commencement of work on the ground; (2) within 10 days after execution of the principal contract; or (3) not less than 10 days before the contract with the subcontractor.  Moreover, the lien stip must be indexed in the name of the general contractor and owner of the property.  Although the GC does not have to provide its subs/suppliers with a copy of the Stipulation Against Liens, it is a good practice to do so because this way the GC ensures that its subs/suppliers actually receive notice.

A subcontractor can also waive lien rights in exchange for progress payments received on a project.

Is there a way to remove a lien?  Yes.  A lien against the property may be removed by petitioning the court to discharge the lien by depositing the amount of the lien with the court or by posting a bond in double the amount of the lien.

Is payment a defense to a mechanics’ lien claim?    There is no automatic “defense of payment” for the owner.  The owner can be required to pay for a project twice.  But the owner can protect itself by recording a copy of the general contract or stipulation in the prothonotary’s office before commencing construction.  This will limit each subcontractor to a pro-rata share of money still owed to the general contractor.

Why might a mechanics’ lien be preferred over filing a breach of contract complaint in court?  A mechanics’ lien creates a better security interest.  In the event of the owner’s bankruptcy, the automatic stay of the United States Bankruptcy Code does not stay perfection of the mechanics’ lien claim for new construction.  This is because a lien claim “relates back” to the time when work visibly commenced on the project.  Moreover a mechanics’ lien has priority over all liens on a property (except an acquisition or construction loan).  Additionally, lien rights survive any foreclosure or sale of property (except foreclosure on an acquisition or construction loan).

Accordingly, if the owner’s finances appear to be precarious and a contractor is not getting paid, a mechanics’ lien might be the best mechanism for protecting the contractor.

This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.

 

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