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ARCO says plaintiffs in lawsuit were not company employees The plaintiffs contend ARCO hired them as temporary employees and then classified them as contractors to avoid paying benefits Tracy Wilson PNA Staff Writer
Atlantic Richfield Co. says that nine people who sued the company and its subsidiaries over benefits they say were improperly denied to them were never employed by ARCO.
The plaintiffs in the class-action lawsuit filed June 24 in U.S. District Court in Los Angeles were employees of other companies ARCO hired to perform services in North Slope oil fields, according to a June 30 release from ARCO spokeswoman Linda Dozier.
“All voluntarily became employees of independent oil field service companies that hired these individuals, provided a range of employee benefits and which had responsibility for making all personnel decisions regarding the individuals, including termination of their services,” the release said.
Plaintiff attorney Brian Waid, however, maintains his clients were indeed ARCO employees.
“Their position is you’re not an ARCO employee unless they say you’re an ARCO employee,” said Waid, an attorney with the Seattle-based law firm of Bendich, Stobaugh & Strong. “The law doesn’t allow the employer to do that. If that were the case, the employer could circumvent all kinds of laws for protection of workers.”
Are they employees of ARCO or another company? Waid’s firm, along with the Los Angeles firm of Kalisch, Cotugno & Rust, filed the lawsuit under the Employee Retirement Income Security Act on behalf of the people they say are common-law ARCO employees misclassified as temporary agency employees, leased employees, contractors and/or independent contractors.
The plaintiffs contend ARCO hired them as temporary employees and then wrongfully classified them as contractors. They claim ARCO should have hired them permanently but refused to as a way to avoid paying benefits provided to ARCO’s 18,000 regular workers, including retirement, a 401(K) plan, an employee stock bonus plan and ARCO’s comprehensive health and dental plan.
“This is not just an ARCO Alaska problem,” Waid said. “It’s a problem throughout the company and its many subsidiaries.”
According to the plaintiffs, ARCO and its subsidiaries hired, trained, fed and housed the contract employees but used a series of third-party companies to serve as “payroll service” agencies that processed the plaintiffs’ paychecks, withheld federal taxes and paid the employers’ portion of FICA taxes. The plaintiffs reportedly provided the companies with time sheets after their hours were approved by ARCO supervisors and the companies then delivered the paychecks.
The suit contends ARCO used the tactic on at least 1,000 workers during the past decade.
“While the companies claim the payroll agencies were the ‘employers,’ the truth is that they were ARCO employees the whole time,” the law firm said in a news release.
Hundreds of plaintiffs could emerge, lawyer says The nine plaintiffs named in the lawsuit are Moira Casey, William Bixby, Mark Clark, James Eldridge, John Harpole, Billy Rackley, Lynn Spackman, Tim Stumo and Peggy Travis, but other unnamed plaintiffs are expected to come forward, Waid said.
According to the complaint, Casey worked for ARCO Alaska from 1987 to 1999 — both in its Anchorage offices and in Prudhoe Bay — in a variety of administrative aide positions and in ARCO Alaska’s environmental compliance department.
Bixby worked for ARCO Alaska as a turbine mechanic in the company’s central compressor plant in Prudhoe Bay from 1990 to 1996, the complaint stated.
Clark worked for ARCO Alaska in Prudhoe Bay from 1990 through this year in the company’s electrical shop as an electrical apprentice and journeyman electrician.
The lawsuit said Eldridge worked as a maintenance electrician for ARCO Alaska from 1989 to 1997 at the Lisburne production center in the greater Point McIntyre oil field.
Harpole reportedly began working for ARCO Alaska in Prudhoe Bay in 1991 and is assigned to the Prudhoe Bay electrical shop.
According to the lawsuit, Rackley worked for ARCO Alaska from 1988 to 1999, performing instrument repair and calibration in the Prudhoe Bay instrumentation shop.
Spackman reportedly worked for the company from 1990 to 1997 as a maintenance electrician in Prudhoe Bay’s Flow Station No. 3.
The lawsuit said Stumo worked at ARCO Alaska’s crude oil topping unit in Prudhoe Bay from 1990 to 1998 as a fuel dock operator and COTU operator and lead operator and that Travis worked for ARCO Alaska in Prudhoe Bay from 1988 to 1998 as an administrative aide.
Laying groundwork for court The plaintiffs are seeking certification as a class; a declaratory judgment determining the rights of the plaintiffs and the class; an injunction requiring ARCO and its subsidiaries to properly classify plaintiffs and the class and enroll them in the company plans; benefits, restitution, compensation and/or damages; punitive damages; pre- and post-judgment interest and attorney fees and costs.
Judge Dean Pregerson, the original judge assigned to the case, recused himself after revealing he had done legal work for ARCO. The case has since been assigned to Judge Lourdes Baird.
ARCO’s response to the complaint is due Aug. 15 and the plaintiffs’ motion for class certification is due Nov. 21.
Waid’s firm previously won a case against Microsoft Corp., which was accused of hiring temporary workers to avoid paying benefits. Dozier’s statement said ARCO’s case is different because ARCO contracted with established companies and not with individual independent contractors, as in the Microsoft case.
Dozier’s statement added that the claims are similar to those filed against Capital Cities/ABC Inc., Exxon Corp., Mountain States Telephone and Telegraph and Southwestern Bell.
“In each of these other lawsuits, the court found in favor of the company,” the statement said.
—The Associated Press contributed to this story
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