US Department of Labor files suit after investigation finds federal contractor failed to ensure subcontractors paid $3.3M in wages, fringe benefits

DES MOINES, IA – The U.S. Department of Labor filed suit against a federal contractor that failed to ensure its subcontractors paid 3,964 employees as required at 88 Iowa sites, resulting in $3,348,543 in prevailing wage, overtime and fringe benefit back wages due. The employees removed poultry waste potentially infected with avian flu from the sites.

On Jan. 21, 2022, the department filed its complaint with the Office of Administrative Law Judges to recover the unpaid wages. An investigation by the department’s Wage and Hour Division found that prime contractor, Clean Harbors Environmental Services Inc., of Norwell, Massachusetts, failed to audit its 145 subcontractors for compliance with the McNamara-O’Hara Service Contract Act and the Contract Work Hours and Safety Standards Act.  

“Vigorous enforcement of prevailing wage laws ensures that responsible contractors can participate in federal contracting, and it protects the wages of hardworking, middle-class workers,” explained Acting Wage and Hour Division Administrator Jessica Looman. “Prime contractors are responsible for their own compliance and for ensuring subcontractors also comply with federal contract labor protections. The Wage and Hour Division remains vigilant in its enforcement to ensure employees are paid in accordance with prevailing wage laws.”

Investigators found subcontractors on the project violated the SCA and failed to pay workers according to the applicable wage determination. As a result, they paid service workers less than the required prevailing wage and fringe benefit and miscalculated workers’ hourly rate for overtime pay. In some cases, contractors also failed to pay overtime for all hours worked in excess of 40 per week, a violation of the CWHSSA.

Founded in 1980, Clean Harbors provides environmental emergency response and hazardous waste disposal services nationwide.

In 2021, the Wage and Hour Division recovered more than $48 million in back wages due to over 21,000 employees working on federal contracts. Learn more about the Wage and Hour Division, including a search tool to use if you think you are owed back wages collected by the division. Employees and employers can contact the division’s toll-free helpline at 866-4US-WAGE (487-9243) for information about federal labor laws and worker protections.