Complaint Accuses Contractor of Underpayment at Medicare Call Centers

WASHINGTON — A federal contractor systematically underpaid workers in call centers that serve beneficiaries of Medicare and the Affordable Care Act, and could owe those employees as much as $100 million in back wages, a labor union said in a complaint filed on Friday with the Labor Department.

The union, the Communications Workers of America, along with 1,600 workers, has accused the contractor, General Dynamics Information Technology, of essentially misclassifying workers to pay them lower wages. The complaint claims that workers were required to perform tasks that were above their pay grades, in a bid to pay those workers less than the federal government would require if their jobs were properly classified.

The complaint focuses on the company’s call center, in Hattiesburg, Mississippi, which is one of several locations where General Dynamics employs workers to staff federal health care help lines as part of a 10-year contract with the Centers for Medicare and Medicaid Services. The union does not represent the call center employees but is bringing the complaint on those workers’ behalf. It has previously filed three similar complaints asserting similar underpayment of workers at the company’s call centers in Kansas, Louisiana and Virginia. Those cases remain under investigation.

In its latest complaint with the Labor Department’s Wage and Hour Division, the union says that General Dynamics is engaged in “systemic wage theft” in its call centers. “If WHD confirms this wage theft is occurring,” union officials wrote in a letter accompanying the formal complaint, “CWA estimates that thousands of low-wage workers employed by General Dynamics Information Technology stand to recover over $100 million in back wages.”

Mark Meudt, a spokesman for General Dynamics Information Technology, said in an email late Tuesday that the company “takes seriously our obligations under the Fair Labor Standards Act and Service Contract Act.” He noted that the communications union does not represent the company’s call center employees.

“We value our people and the work that they perform,” he said. “Similar to other federal contractors, the company is subject to routine compliance reviews by the Department of Labor. As with any notice received, we will engage with the relevant parties, including our employees and the Department of Labor.”

The complaint follows a move, authorized by congressional Republicans and signed by President Donald Trump, to overturn an Obama-era executive order meant to crack down on wage theft by contractors. The practice of misclassifying workers on federal contracts remains illegal.

“I think this is a real test of whether the law will be enforced under the Trump administration,” said Guerino J. Calemine III, the general counsel for the union.

Federal guidelines stipulate how much contractors like General Dynamics must pay workers in various job classifications, depending on where they live. That means that, to receive a raise in their workplace, employees in the company’s call centers must either move into a more demanding, higher-paid job — which typically requires additional training — or hope that the government increases the pay rates for everyone.

The complaint says that General Dynamics underpaid workers by slotting them into positions that required duties associated with higher-paying jobs.

Agents in the call center “do jobs that require them to select from hundreds of scripts and procedures, adapt these materials to suit caller needs, and use specialized terminology and other subject-matter knowledge gleaned from their training and experience as front-line workers for the Medicare and Federal Marketplace programs,” the complaint says. The union says that those tasks fit the description of positions that correspond to a wage of $11.41 or $12.80 an hour, but that the company classified most of its workers in a position that pays $9.05 an hour.

Two workers at General Dynamics call centers say they have long worried that the company was not paying them sufficiently for the work they were asked to do. Adrian Powe, 26, who works in the Hattiesburg center, said he had completed three company skills trainings, but that none of them had resulted in a wage above $10 an hour.

“I was baffled at the fact that there was no raise” after the trainings, he said. “I knew something wasn’t right.”

Kathleen Flick, 62, works in the Louisiana center that is the subject of a continuing investigation by the Labor Department. She said she believed that based on the work she does, she should be paid an additional dollar or two an hour above her current wage of $13.38.

“It makes me feel horrible,” she said. “Stealing from the working poor, which I am, is low. Really low. I can’t afford to run my air conditioning in the summer.”

The complaint asks the Labor Department to “investigate urgently these allegations,” to require the company to properly classify its workers and to force it to pay back wages to any employees who are found to have been misclassified.