Contractor Liable for Racial Harassment of Subcontractor Employees

African-American workers assaulted and repeatedly harassed at construction site win suit against primary contractor.

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Construction sites are not known for being bastions of cultural sensitivity. But they are not exempt from U.S. labor law prohibiting discrimination, retaliation, and hostile work environments.

The ‘N-word’ and Toilet Water

In EEOC v. Skanska USA Building, three African-American workers endured a hostile work environment daily. The three men operated buck hoists, which are temporary elevators that run up and down the outside of buildings under construction. White coworkers on the site called them monkeys, black motherf—ers and n—ers. Graffiti at the worksite – including within the workers’ portable toilets – included images of white people shooting black people and statements such as “n—ers have to leave”.

One white worker through liquid from the chemical toilet into the face of one of the buck-hoist operators, causing his eyes to swell. Another buck-hoist operator showed up for his regular shift using crutches for a broken leg, but a Skanska call him a “n—er” and told him to get off the jobsite.

Racial Harassment Complaints Ignored

Early on, the African-American workers reported the racial harassment on a near daily basis to the owner of the minority-owned subcontracting firm in charge of the buck hoist (C-1, Inc.). That owner directed the workers to complain directly to the primary contracting company, Skanska USA Building, Inc.

Although the buck-hoist operators were employed by the subcontractor, the primary contractor had the power to remove operators, and their daily responsibilities (including work schedules and time sheets) were directed by the primary contract – not the subcontractor. Eventually, Skanska replaced all the subcontractor’s buck-hoist operators with Skanska employees.

Primary Contractor or Subcontractor: Who’s the Boss?

The court determined that the primary contractor was liable for racial harassment and discrimination even though the victims of the harassment weren’t their direct employees. The court found that the primary contractor and the subcontractor were joint employers because they shared or co-determined matters governing essential terms and conditions of employment. As proof of this finding, the court pointed to the joint ability to:

  • Hire, fire or discipline employees.
  • Affect their compensation and benefits.
  • Direct and supervise their performance.

The Bitter End: Settlement and Outcomes

Skanska will pay $95,000 to settle the racial harassment and retaliation lawsuit with the Equal Employment Opportunity Commission (EEOC). In addition to the monetary relief, Skanska must:

  • Cease subjecting employees to racial harassment or retaliating against any employee who lodges a discrimination complaint.
  • Provide in-person training on race discrimination and retaliation.
  • Maintain records of any complaints of racial harassment.
  • Provide annual reports to the EEOC.

The bitter irony here is that construction contracts are often awarded based on contractors’ commitment to workforce diversity. In this case, the project included several minority-owned or disadvantaged businesses that helped the primary contractor win the project to begin with, but then their employees faced discrimination, retaliation, and even assault as their reward.

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Arizona versus the Feds: State OSHA Plan

Arizona’s State health and safety plan has fallen out of favor with Federal OSHA guidelines. The State may lose its federally approved status – and federal dollars for its health and safety program.

2/6/2015 UPDATE: On February 6, 2015, the Federal Occupational Safety and Health Administration (Federal OSHA) rejected Arizona’s state-specific residential fall protection (RFP) standards. All Arizona state-specific RFP standards are repealed effective Saturday, February 7, 2015. Employers in Arizona must comply with the federal residential fall protection standards.

Arizona is one of 20 U.S. States, Puerto Rico, and the Virgin Islands who have had their job safety and health programs approved by OSHA. Once approved, these State Health and Safety Plans trigger federal funding – up to half of an approved plan’s operating costs. But now Arizona’s State Plan for occupational health and safety is in danger of being removed from the program, which would mean the State would lose federal funding.

At issue is a fall-protection standard that requires workers in residential construction to wear safety harnesses at a working height of six feet above ground (OSHA 29 CFR Part 1926, Subpart M) or to be protected by other fall-protection measures. The Arizona State Plan, however, was amended by legislature (SB 1441) in 2013. That legislation pushed the working height requirement further off the ground to fifteen feet.

Arizona’s State Plan was the fourth U.S. State Plan to receive approval from the U.S. Occupational Safety and Health Administration (OSHA) under Section 18(e) of the Occupational Safety and Health Act. The Act was enacted to create and enforce safe working conditions. It allows U.S. States and Jurisdictions to create and enforce health and safety plans that meet minimum federal guidelines.

The State is asking OSHA to keep the State Plan certified based on discrepancies in OSHA working-height allowances, which also include allowances for individual employers to develop their own fall protection plans when following the letter of the law is infeasible.

What Does Arizona Want from OSHA?

Citing evidence that Arizona’s State plan is more effective than Federal OSHA guidelines, Arizona is seeking renewed discussions with the federal government before OSHA’s final decision to reject the Arizona State Plan.

In its Comments to Proposed Rejection of State Initiated Plan, the Arizona Department of Occupational Safety and Health (ADOSH) asserts:

“The [Industrial Commission of Arizona] and other interested stakeholders are being asked to comment on the effectiveness of Arizona’s approach to fall protection in residential construction along with the overall operation of the State plan and yet, OSHA has not established any criteria against which to judge effectiveness.”

How Would Rejection of the State Plan Affect Arizona Labor Law Posting Requirements?

When a State or Jurisdiction has a State Plan approved by OSHA, employers need only display the State Plan for employees and not the federal OSHA posting. If Arizona’s State Plan loses its approval, employers in Arizona will need to display both the Arizona Employee Safety and Health Protection posting and the federal OSHA Job Safety and Health – It’s the Law posting.

For now employers can display only the Arizona version on the posting – at least until a final determination is made by the Federal OSHA. GovDocs continues to monitor the situation.

For employers in Arizona looking for the most current Arizona Workplace Postings required by the State, please visit GovDocs’ Arizona Posting Packages.