Teamsters

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Federal contractors pay low wages, break labor and employment laws

Funny, we were just pointing out that McKesson, which has a $32 billion Veterans Administration contract despite ripping off Medicaid, also broke labor law when it suspended a worker for four days without pay for mimicking the CEO. John Hammergren is the McKesson CEO with the $159 million pension. He doesn't seem overly concerned that his workers don't earn enough to pay for health insurance.

And now look what crossed our radar screen: Good Jobs Nation points to a new report that shows in addition to paying miserly wages, federal contractors are also among the worst violators of labor and employment laws.

That’s what a new U.S. Senate report concluded. According to Steve Greenhouse at the New York Times, 49 federal contractors were cited 1,776 times for significant legal violations and paid $196 million in penalties from 2007 to 2012. Federal contractors often punish the whistleblowers who report illegal activity (in addition to workers who mimic overpaid CEOs).

The New York Times said the President should take executive action to prevent labor law violations and to boost pay for federal contract workers:

An executive order “requiring contracting officials to consider the quality of jobs that a prospective contractor will offer … would challenge the damaging notion that the best contractor is the one with the lowest labor costs.”

The Washington Post noted the White House was close to a Congressional deal to reduce the pay reimbursements of top contracting executives from nearly $1 million to $500,000 – but also urged the President to help contract workers at the bottom of the pay scale:

If the White House really wanted to make a statement about the value of work, it could do so much more substantively by boosting the floor of what it requires contractors to pay their burgeoning workforce.

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