An investigation by the U.S. Department of Labor's Wage and Hour Division resulted in the restoration of $1,979,779 in 401(k) pension benefits to 515 drivers working on U.S. Postal Service contracts for Lange Trucking Inc. because of violations of the McNamara-O'Hara Service Contract Act. The company, along with its President, William A. Langenhuizen; Vice President, William H. Langenhuizen; Secretary Treasurer, Antoinette Langenhuizen; Vice President, Robert Langehuizen; and Vice President of Finance, Lisa Kulak, have been debarred from eligibility for further service contracts with any U.S. government agency for three years for their failure to pay drivers required fringe benefits.
"Contractors that do business with the federal government have an obligation to abide by the law and pay their employees the required contractual rates and benefits," said U.S. Secretary of Labor Thomas E. Perez. "Restoring the pension benefits of these workers and debarring this employer illustrate the department's commitment to vigorous enforcement of government contracting laws and helps level the playing field for law-abiding employers."
Wage and Hour investigators found that Lange Trucking failed to fully fund the drivers' 401(k) plan, resulting in a violation of the SCA. Wage and Hour has investigated the company several times in the past. Lange Trucking paid $500,000 of the unpaid benefits while Hoovestol Inc., which is based in Eagan, Minn., acquired the company subsequent to the violations and voluntarily agreed to fund the remaining $1.48 million in benefits. Hoovestol, which cooperated fully with the Wage and Hour Division during its investigation, has also: corrected record-keeping procedures, overhauled the plan to ensure timely payments into the plan going forward, posted wage determinations at the work site and made information about the contracts accessible to employees.
The SCA applies to every contract entered into by the United States or the District of Columbia, the principal purpose of which is to furnish services in the United States through the use of service employees. The SCA requires that contractors and subcontractors performing services on covered federal contracts in excess of $2,500 must pay their service workers no less than the wages and fringe benefits prevailing in the locality.