Many gov't contractors are big labor law violators

Many of the biggest violators of federal workplace safety and wage laws are large government contractors, according to a year-long investigation by the Senate Health, Education, Labor, and Pensions Committee. Almost 30 percent of top wage and safety law violators also currently hold federal contracts.

The federal government pays $500 billion a year to private companies for goods and services. Government contracts employ an estimated 22 percent of the nation's workforce, according to the committee report on the investigation.

The findings were "deeply troubling," according to a statement from Senator Tom Harkin (D-IA). Under federal law, the government is supposed to ensure that contractors have a "satisfactory record of integrity and business ethics." However, the federal contracting system has "virtually no reliable tools" to ensure that labor law violations are considered before a contract award.

The report states that penalties faced by 18 federal contractors were among the top 100 the Occupational Safety and Health Administration (OSHA) issued between 2007 and 2012. These companies included BP, Louis Dreyfus Group (Imperial Sugar), Cintas, GM, and Chrysler. Forty-two workers died in this period because of contractor OSHA violations. In 2012, almost half the initial penalties levied by OSHA were against federal contractors.

The same year, Bridgford Foods, CHS (Cenex Harvest States), Johnson Controls, Tyson Foods, Verizon Communications, Bartlett and Company, and Blackstone Group were contractors that landed on an OSHA list of "severe violators." Those on the list were deemed to have committed "willful, repeated, or failure-to-abate violations" that resulted in employee deaths, exposures to the most severe hazards, hazards related to chemical releases, or "all egregious enforcement actions."

Of the top largest 100 back wage assessments by the Wage and Hour Division of the Department of Labor in 2007 through 2012, 32 went to federal contractors. They included HP, Manpower, AT&T, Lockheed Martin, General Dynamics, Nestle, Home Depot, and Vanderbilt University. Contractors receiving penalties for "severe and repeated violations of wage law" included Sprint Nextel, UnitedHealth, Marriott International, C&S Wholesale Grocers (Piggly Wiggly), and the University of Pittsburgh Medical Center.

Thirty-five contractors in the same period violated both wage and safety laws. The 49 total contractors violating wage or safety laws were cited in 1,776 separate instances. Collectively, they paid $196 million in penalties and assessments.

Although federal agencies are supposed to consider whether a prospective contractor for a given contract has a "satisfactory record of integrity and business ethics," the term is not precisely defined. An internal government system tracks performance on previous contracts but does not typically contain information about legal violations.

The report blames poor data, lack of effective data-sharing abilities, inadequate expertise, and inflexible penalties for why labor law violators can continue to get federal contracts. Under the Clean Contracting Act of 2008, a new database was supposed to allow government contract officers to examine previous compliance with federal law. But if the information is not in one of the three main databases that contract officers use, it is not evaluated.
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    Erik Sherman is a widely published writer and editor who also does select ghosting and corporate work. The views expressed in this column belong to Sherman and do not represent the views of CBS Interactive. Follow him on Twitter at @ErikSherman or on Facebook.