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Subsidizing Contractor Misconduct

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Subsidizing Contractor Misconduct

Three Contractors Who Won Big Despite Egregious Labor Violations
by Chris Thompson, Special to CorpWatch
January 7th, 2015

Damage caused by Imperial Sugar refinery explosion at Port Wentworth, Georgia. U.S. Chemical Safety and Hazard Investigation Board.

Rodney Bridgett was killed when a piece of Tyson Foods' heavy equipment crushed him. Calvin Bryant was crippled in a Imperial Sugar plant explosion in Georgia that also killed 14 of his co-workers. When Alma Aranda tried to exercise her legal right to take unpaid time off to care for her dying mother, Verizon harassed her with so much paperwork that her hair fell out in clumps.

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What do these three cases have in common? The federal government handed out tens of millions of dollars in contracts to these companies, without regard to how they treated their workers.

Last summer, to help put an end to these kinds of mistreatment, President Barack Obama signed the Fair Pay and Safe Workplaces Executive Order.

Here's why the executive order could help workers: Every year, the federal government awards a fortune in contracts for everything from defense systems to administrative services to companies that employ an estimated one in five American workers.

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Subsidizing Contractor Misconduct

Full Report (PDF): Subsidizing Contractor Misconduct

Part One: Tyson Foods - Rodney's Story

Part Two: Imperial Sugar - Calvin's Story

Part Three: Verizon - Alma's Story

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Government rules that require it to contract only with companies that have a "satisfactory record of performance, integrity, and business ethics." In practice, the contracting system does not effectively review companies' records for responsibility, nor does it ensure--before awarding contracts--that violators reform their practices.

As a result companies have continued to receive billions of dollars, despite long records of violating workplace laws. They may neglect legally required safety standards and maim a worker on the job, systematically engage in age or gender discrimination, refuse to pay overtime in violation of the law, or ignore the Americans with Disabilities Act and demote or fire disabled employees.

When these companies are caught, they may face financial penalties. Sometimes they are in the form of a fine from the Occupational Safety and Health Administration (OSHA), rarely in excess of a few hundred thousand dollars. Sometimes the payoff is a little steeper, such as when employees or state agencies file class action lawsuits and collect millions.

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CorpWatch: Non-profit investigative research and journalism to expose corporate malfeasance and to advocate for multinational corporate accountability and transparency. We work to foster global justice, independent media activism and democratic control over corporations.

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We believe the actions, decisions, and policies undertaken and pursued by private corporations have very real impact on public life -- from individuals to communities around the world. Yet few mechanisms currently exist to hold them accountable for those actions. As a result, it falls to the public sphere to protect the public interest.

In many cases, corporate power and influence eclipses even the democratic
political process itself as they exert disproportional influence on public policy they deem detrimental to their narrow self-interests. In less developed nations, they usurp authority altogether, often purchasing government complicity for unfair practices at the expense of economic, environmental, human, labor and social rights. 

Yet despite the very public impact of their actions and decisions, corporations remain bound to be accountable solely to their own private financial considerations and the interests of their shareholders. They have little incentive, nor requirement, for public transparency regarding their decisions and practices, let alone concrete accountability for their ultimate impact.

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