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Secretary of Labor Thomas E. Perez
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News Release

WHD News Release: [04/12/2011]
Contact Name: Michael Shimizu
Phone Number: (206) 553-7620
Release Number: 11-0262-NAT

US Department of Labor debars Seattle-based federal contractor for violating minimum wage, overtime and record-keeping laws

HWA provided services in Washington, Oregon, Idaho, Missouri and New York

SEATTLE — The U.S. Department of Labor has debarred HWA Inc., President John Wood and Vice President Barbara Wood from future government contracts for three years, due to significant and repeated violations of the McNamara-O'Hara Service Contract Act and the Contract Work Hours and Safety Standards Act. Seattle-based HWA provided security services as a contractor to various federal facilities, government offices and public works projects in the states of Washington, Oregon, Idaho, Missouri and New York.

"The Labor Department will not allow federal contractors to misuse public funds and exploit hardworking laborers by denying their rightful wages," said Secretary of Labor Hilda L. Solis. "Debarring violators such as HWA from future contracts ensures a level playing field, so that honest companies are not placed at a competitive disadvantage for playing by the rules, and paying their workers full and fair prevailing wages."

This debarment action is based on HWA's history of violations concerning the minimum wage, overtime and record-keeping provisions of the SCA and CWHSSA. Since 2001, the Labor Department's Wage and Hour Division has conducted more than 15 investigations of HWA, finding significant back wages were owed to hundreds of workers nationwide.

Most recently, in 2009, the company defaulted on seven federal contracts and failed to meet its payroll obligations, resulting in nearly $1 million in unpaid wages for 206 employees. The division ordered an emergency withholding of funds on several of the company's federal contracts and secured the full payment of these wages. All SCA contracts held by the HWA were terminated shortly thereafter.

SCA contract clauses require contractors and subcontractors performing services under prime contracts in excess of $2,500 to pay service employees in various classes no less than the wage rates and fringe benefits found prevailing in the locality, or the rates contained in a predecessor contractor's collective bargaining agreement, including prospective increases. The Labor Department issues SCA wage determinations for contracting agencies to incorporate into covered contracts, along with the required contract clauses. The fringe benefit requirements — usually vacation and holidays, known as "health and welfare" benefits — are separate and in addition to the hourly monetary wage requirement under the SCA. In addition, employers with prime contracts in excess of $100,000 under the CWHSSA must pay workers at least one and one-half times their regular rates of pay for all hours worked over 40 in a week.

For more information about federal wage laws, call the Wage and Hour Division's toll-free helpline at 866-4US-WAGE (487-9243) or its Seattle District Office at 206-398-8039. Information is also available on the Internet at http://www.dol.gov/whd/.