SEPT 2011

The sole shareholder of a company that withdrew from a multiemployer pension fund, who also leased real estate to the withdrawing company, is personally liable for the company’s $954,500 in withdrawal liability, the US District Court for the Northern District of California recently ruled.

Granting summary judgment for the Carpenters Pension Trust Fund for Northern California, the Court found that the shareholder’s leasing activities constituted a “trade or business” in “common control” with the withdrawing company under the Multiemployer Pension Plan Amendments Act.

In the current action, the fund sought summary judgment against Lindquist, contending he was liable for the withdrawal liability under the MPPAA’s common control provisions because he leased real estate to the company for seven years. The fund argued that the leasing activities constituted a trade or business under common control with the company.

Under the MPPAA, multiemployer plans can impose proportional liability on withdrawing employers for the unfunded vested benefit obligations of the plans. Employers include not only the entity making the contributions to the plan, but also trades or businesses that are under common control with the contributing entity. As such, these trades or businesses are considered a single employer that are jointly and severally liable for withdrawal liability.

On August 1, 2011, the Occupational Safety and Health Administration (OSHA) announced that it is implementing measures to strengthen its Whistleblower Protection Program (WPP). Under the program, OSHA enforces 21 statutes that prohibit employers from retaliating against employees who raise concerns or provide protected information to the employer or to the government concerning violations of the law. Employees who believe they have been retaliated against for engaging in protected conduct can file a complaint with the secretary of labor for investigation by the WPP.

Two construction companies constitute a single employer under the Employee Retirement Income Security Act, and therefore the companies are liable for plan contributions to various multiemployer benefit funds for work covered by a collective bargaining agreement with a local branch of the International Union of Operating Engineers, the US District Court for the District of New Jersey recently ruled.

In granting the funds’ motion for summary judgment, the Judge explained that the companies were part of a single integrated enterprise. Since the companies constituted a single employer, they were considered one entity in terms of liability for delinquent contributions, the court explained.

McRand Contracting Co. and Bil-Jim Construction Inc. were affiliated construction companies. McRand was a party to a collective bargaining agreement with the Operating Engineers Local 825 that required contributions to several multiemployer benefit funds, while Bil-Jim was not a party to a union contract. In fact, since Bil-Jim was established as a construction company in 1965, it has never entered into a collective bargaining agreement with any union.

The funds brought their lawsuit under ERISA Section 515 for contributions after discovering that, over many years, the companies had used nonunion employees to perform certain work covered by the agreement.

Single Entity Liability – the court ruled that the companies owed the funds contributions under the single employer doctrine, which holds two nominally separate entities liable as one single employer. If two entities constitute a single employer, they are considered one employer for liability purposes.

The court found that McRand and Bil-Jim constituted a single employer because they: shared offices and had an interdependent focus; were managed by the same officers; share supervisors and staff; and were owned by the same people.

An early version of a proposed worker safety standard for steel reinforced concrete and post-tensioned steel construction is now with the White House Office of Management and Budget for review. OSHA submitted the “prerule” to OMB on July 8, 2011.

OSHA wants to move the reinforced concrete standard to the “advance notice of proposed rulemaking” stage, a designation that opens the door for the construction industry and others to make official comments about the draft standard.

Currently, the only safety regulation of the steel reinforcing and post-tensioning processes are OSHA’s rules for concrete and masonry construction (29 CFR 1926, Subpart Q). According to OSHA, more than 100 workers have died over the past 10 years in accidents while working with or near construction involving reinforced steel or high-tension cables. The mishaps included workers killed by collapsing walls and floors and impalement on metal rods.

The proposal for a reinforced concrete standard emerged from a collation of unions, contractors, and related organizatio0ns who have said Subpart Q is “antiquated” and does not provide enough specific guidance for steel reinforced construction.

The Department of Homeland Security’s U.S. Citizenship and Immigration Services Aug. 15 expanded E-Verify self-check, a service that allows individual to check their own employment eligibility status before seeking employment, to 16 additional states.

The service is now accessible to residents in California, Louisiana, Maine, Maryland, Massachusetts, Minnesota, Missouri, Nebraska, Nevada, New Jersey, New York, Ohio, Texas, Washington, Utah and South Carolina.

Employers use the internet-based E-Verify to determine employees’ eligibility to work in the United States by entering information reported on the employee’s Form I-9. When workers over age 16 use the self-check program, they enter the same information that employers would enter into E-Verify, USCIS said.

The self-check service is free and voluntary and gives users the opportunity to submit corrections of any inaccuracies in their DHS or Social Security Administration records before applying for jobs.

A new rule from the National Labor Relations Board (NLRB) is being touted by the agency as a moderate measure aimed at ensuring that workers understand their rights, but it’s drawing fire from some employers who call it a “punitive new rule” from a federal agency overreaching its authority.

The board issued a final rule on August 25, 2011 that will require employers to notify employees of their rights under the National Labor Relations Act as of November 14. The NLRB has posted a fact sheet on its website with details about the new posting requirements.

Private sector employers, including labor organizations whose workplaces fall under the NLRA, will be required to post an employee rights notice where other workplace notices are typically posted. Further, employers that post notices to employees regarding personnel rules or policies on an Internet or intranet site will be required to post the NLRB notice on those sites.

The notice states that employees have the right to act together to improve wages and working conditions; to form, join, and assist a union; to bargain collectively with their employer; and to refrain from any of those activities, according to the NLRB. The notice also provides examples of unlawful employer and union conduct and instructs employees how to contact the NLRB with questions or complaints.

The new rule comes amid other recent NLRB actions that have raised concerns from employers. In July, the Board held hearings on a proposed rule that would shorten the time between a labor petition and a representation election. Employer representatives spoke out against the rule, saying it would hand unions an unfair advantage over employers.