DOL Says Union Employee Fired for Helping with Investigation

The corporation managed assets for five Cement Masons employee benefits trusts in southern California. The lawsuit alleges the individual had been making internal Employee Retirement Income Security Act (ERISA)-related complaints for some time.

According to the lawsuit, in her capacity as director of the Field Audit and Collections Department, the individual and her staff were responsible for collecting contributions from employers who were delinquent in their required payments as well as auditing employers’ records with regard to contributions due to the Trusts. The individual complained that Scott Brain, business manager for Cement Masons Local Union 600 and a trustee of the corporation, was engaged in various schemes to deprive the trust funds of contributions owed by employers which allowed some employers to underpay the trust funds.

In 2011, she was contacted by the DOL’s Employee Benefits Security Administration officials during the course of an ongoing investigation into the conduct of Brain. The lawsuit says the individual informed union officials and its counsel that she had been contacted. Upon learning of her contact with federal officials, the joint board of trustees voted to place the individual on administrative leave. The corporation was then dissolved, and its successor, Zenith American Solutions failed to rehire the individual, though it rehired everyone else in her department. 

The lawsuit seeks to have the individual reinstated as soon as possible to a position with Zenith American Solutions comparable to her former job. It also seeks lost wages, plus interest, covering the time from the individual’s termination to her reinstatement, plus other costs that the individual may have incurred as a result of her termination. It also seeks the removal of Brain and other named defendants as trustees and service providers, and a ban on their serving in the future as fiduciaries or service providers to any ERISA-covered plan. Finally, the suit seeks to require mandatory training for all affected employees and trustees about participants’ and workers’ rights under ERISA. 

“Workers must be free to participate in Department of Labor inquiries without fear of retaliation,” says Assistant Secretary of Labor of the Employee Benefits Security Administration Phyllis C. Borzi. “By law, they have a right to report suspected violations to the department and must be allowed to cooperate with investigators.”

The case, Perez v. Scott Brain, et al. Case No. CV 14-3911 is filed in the U.S. District Court for the Central District of California.