CCA Has Long History of Wage Violations, Poor Treatment of Employees

On August 20, 2014, Corrections Corporation of America (CCA), the nation’s largest for-profit prison operator, issued a press release that attempted to put a positive spin on over $8 million in back wages the company had agreed to pay to employees at one of its facilities.

According to the U.S. Department of Labor (DOL), CCA had paid 30 to 40 percent less than required under rules for federal contractors to workers at the company’s California City Correctional Center. CCA was also accused of failing to make required payments to employees’ retirement and health and life insurance accounts, as well as violations related to “inaccurate recording of breaks, lunches and overall hours worked,” according to the Associated Press. Some employees will receive more than $30,000 in back pay.

“The people that get these federal monies from a federal agency to get one of these contracts have to abide by the wage rates,” stated Eduardo Huerta, assistant director of the DOL’s wage and hour division.

CCA claimed the $8 million payment for back wages was due to a “retroactive contract modification” by federal officials, and said it had “diligently” and in “good faith” worked with the Department of Labor to ensure employees received the pay they were owed.

“We greatly value our employees and the important work that they do to keep our communities safe and secure,” said CCA spokesman Steve Owen.

However, the company did not mention that it has repeatedly been sued by its own employees for failing to pay required wages. In fact, CCA settled an earlier wage and hour lawsuit involving the California City Correctional Center for an undisclosed amount in 2004, and has paid millions to resolve other wage-related cases over the past dozen years.

Most recently, on August 13, 2014, a federal court in Kentucky unsealed a settlement in a wage and hour lawsuit filed against CCA. The case had settled in November 2013, with the company agreeing to pay $260,000 to 25 shift supervisors who claimed they were denied overtime and required to work extra hours without compensation.

The settlement was unsealed – over CCA’s objections – after Prison Legal News intervened in the case to make the settlement public. The district court held that CCA had failed “to overcome the presumption in favor of permitting public access” to the settlement, and thus it “must be open to public inspection.” PLN was represented by the ACLU of Kentucky. See: Johnson v. CCA, U.S.D.C. (W.D. Ky.), Case No. 3:12-cv-00246-JGH.

Also, in August 2009 the U.S. District Court for the District of Kansas unsealed a $7 million settlement agreement in a class-action wage and hour lawsuit against CCA. The suit, brought under the Fair Labor Standards Act, alleged that CCA had required some employees to perform work duties “without compensating them for all such hours worked.” Specifically, the company was accused of not paying correctional officers and other employees for pre- and post-shift work that included roll calls, obtaining weapons and equipment, attending meetings and job assignment briefings, and completing paperwork.
Again, the settlement was made public, over CCA’s objections, after Prison Legal News intervened to unseal details of the agreement, which applied to more than 30,600 potential class members nationwide. [See: PLN, Jan. 2010, p.20; Oct. 2009, p.31].

“The public has a right to know how its tax dollars are being spent when government agencies contract with for-profit companies like CCA to operate prisons and jails, especially when such companies are accused of violating the law to increase their profit margins,” said PLN managing editor Alex Friedmann.

Additionally, according to records produced by CCA, in 2002 the company paid $2 million to resolve three federal lawsuits filed by employees in Mississippi under the Fair Labor Standards Act. And according to a report issued last year by Grassroots Leadership, titled “The Dirty Thirty: Nothing to Celebrate About 30 Years of Corrections Corporation of America,” in 2000 the company had settled lawsuits alleging wage and hour violations at the CCA-operated Winn Correctional Center in Louisiana and San Diego Correctional Facility in California.

The company has also faced litigation related to employment discrimination, retaliation and sexual harassment at its for-profit prisons.

For example, CCA entered into a consent decree with the Equal Employment Opportunity Commission (EEOC) on October 1, 2009, agreeing to pay $1.3 million to settle allegations of sexual harassment and retaliation involving female employees at the Crowley County Correctional Facility in Colorado, operated by Dominion Correctional Services and later by CCA.

According to the lawsuit, female staff members were subjected to “unlawful sexual harassment and gender-based harassment.” The complaint alleged female employees had been hired based on whether they might be “easy to get to bed.” After being hired they were “routinely groped, pawed, and physically assaulted by male management and male co-workers.” Those who complained were subjected to retaliation, such as false charges to justify retaliatory discipline, assignments to areas where there was an increased risk of harm and intentionally assigning female employees to work with their alleged harassers, exposing them to “actual and threatened abuse.” [See: PLN, May 2010, p.46].

Further, in 2007, CCA paid $438,000 to settle claims of discriminatory hiring practices at the company’s Central Arizona Detention Center in Florence; the U.S. Department of Labor said CCA had violated federal law by disproportionately rejecting non-Hispanic job applicants who sought employment during a two-year period. The company agreed to hire 16 applicants who had been rejected, but denied any wrongdoing. [See: PLN, Sept. 2007, p.25].

And in 2002, CCA settled a gender discrimination suit by agreeing to pay $152,000 in back wages to 96 women who had applied for jobs at the company’s facility in Sayre, Oklahoma but were not hired. The settlement was reached after an audit by the U.S. Department of Labor found that female applicants with equal or better qualifications than their male counterparts had been rejected due to their gender. [See: PLN, May 2003, p.13].

According to a list of lawsuits filed against CCA, produced by the company itself, CCA has also settled dozens of individual complaints brought by current and former employees raising claims of sexual harassment, discrimination and wrongful termination.

Additionally, a federal jury in Oklahoma found that CCA had violated the rights of a military veteran by failing to retain his job position after he returned from a tour of duty in Iraq. Jurors recommended in August 2010 that the company pay veteran Dennis Weems around $53,000 for violating the Uniformed Services Employment and Re-employment Rights Act, which prohibits employers from denying re-employment, retention in employment, promotion or any benefit of employment to a member of the military on the basis of their military service. See: Weems v. CCA, U.S.D.C. (E.D. Okla.), Case No. 6:09-cv-00443-JHP.

An attorney for CCA admitted that mistakes had been made in that case, while Weems claimed CCA had violated the rights of other veterans who returned to their jobs at the company following military service – such as re-hiring them at lower pay rates.

“It appears that in some cases, CCA treats its own employees with the same distain that it treats prisoners held in the company’s for-profit facilities,” said Friedmann, who served six years at a CCA-operated prison in Tennessee in the 1990s.

In May 2013, at CCA’s annual shareholder meeting, Friedmann had requested a brief moment of silence for company employee Catlin Carithers, who had been killed during a riot at the Adams County Correctional Facility in Mississippi. His request was flatly denied by CCA board president John Ferguson. [See: PLN, June 2014, p.48].

“CCA holds a shareholder meeting just once a year, and they couldn’t give 30 seconds to honor the memory of one of their own who died in the line of duty,” Friedmann said at the time. “That is callous and insensitive. It is also indicative of the value that CCA places on its employees.”

Apparently, that value is fairly low.

Sources: HRDC press release (Aug. 22, 2014); www.privateci.org; Associated Press

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