Senate Meal Supplier Not Banned From Contracts Over Pay Charge

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By Ben Penn

The Labor Department won’t ban a Senate cafeteria contractor from government business over charges it didn’t pay workers properly.

The DOL settled the case with contractor Restaurant Associates by entering into a compliance agreement with the food service provider, a company spokesman told Bloomberg BNA. The settlement doesn’t include the harsher penalties that had been sought by the Obama administration.

A DOL administrative law judge approved the settlement earlier this month, according to an order appearing on the agency website Oct. 12. The company and a DOL regional solicitor’s office agreed that instead of a debarment, Restaurant Associates would abstain from bidding on new federal service contracts for two years, the order states.

“As a part of the collaborative resolution, RA had evidenced its commitment to compliance by agreeing to training and biannual compliance reviews,” Sam Souccar, the Restaurant Associates spokesman, said in an email. Souccar didn’t provide additional terms of the settlement.

The DOL’s Wage and Hour Division in December announced it would initiate debarment proceedings against Restaurant Associates. That would have made the New York-based hospitality corporation ineligible to bid on government contracts for three years. The Obama WHD said the Service Contract Act violations warranted a timeout from the federal contracting business for the company.

The company agreed in July 2016 to pay more than $1 million to 674 cafeteria workers who serve meals to senators and staffers in the U.S. Capitol and nearby office buildings.

“In addition to immediately paying all back wages due, RA has committed to take positive and practical steps to ensure compliance on a go forward basis,” Souccar’s statement continued.

The Labor Department didn’t provide a comment.

Labor Coalition Displeased

The original investigation into Restaurant Associates began after Good Jobs Nation, led by the Change to Win labor federation, submitted a complaint to the DOL in January 2016.

The complaint alleged that Restaurant Associates unlawfully changed worker job classifications to avoid giving raises that were contained in a December 2015 contract renewal.

“Trump’s DOL is sending a clear signal to federal contractors—there’s no serious penalty for violating worker rights,” Joseph Geevarghese, director of Good Jobs Nation, told Bloomberg BNA in an email. “The failure of DOL to fully use its debarment powers, coupled with the rollback of the Fair Pay and Safe Workplaces Executive Order, means that federal contract workers will continue to be victimized by unscrupulous employers.”

The Fair Pay Safe Workplaces EO, signed by President Barack Obama, would have required government contractors to disclose their histories of labor violations in order to continue doing business with federal agencies. Trump signed legislation, passed under the Congressional Review Act, that effectively killed that order and its implementing rules.

To contact the reporter on this story: Ben Penn in Washington at bpenn@bna.com

To contact the editor responsible for this story: Chris Opfer at copfer@bna.com

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