Morning Briefing - October 01, 2018
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October 01, 2018

MOX Contractor and NNSA Weighing Settlement Over $1M in Wage-Related Withholding

By ExchangeMonitor

To resolve one of the many claims tacked on to a roughly $200 million lawsuit, the Department of Energy and contractor MOX Services are working a legal settlement over some $1 million the federal agency allegedly refused to pay after the company gave 55 employees raises a few years ago.

In a Wednesday order, U.S. District Judge Thomas Wheeler said he would stay proceedings in the portion of the lawsuit concerning the $1 million in wage-related withholdings until Oct. 9 “to allow for finalization of the settlement process.”

The lawsuit over the disputed payment is the focus of one of several in the U.S. Court of Federal Claims that were rolled up into a larger case filed against DOE in 2016 by the prime contractor for the Mixed Oxide Fuel Fabrication Facility (MFFF): an unfinished plutonium disposal plant the department’s semiautonomous National Nuclear Secuity Administration (NNSA) wants to cancel.

In a June 27 complaint since consolidated into the master suit, MOX Services alleged the NNSA arbitrarily levied a financial penalty because the company gave raises to some 55 employees after one of its subcontractors and owners, CB&I, acquired another subcontractor and owner, Shaw, in 2013.

MOX Services said CB&I — which was acquired by McDermott International this year — gave the raises as part of a broader effort to realign the salaries and job titles of former Shaw employees with comparable CB&I personnel, according to the complaint. The NNSA said CB&I did not document any justification for those raises and, around 2017, started withholding a portion of the money owed to the company under the MFFF prime contract.

CB&I said it had turned all the documentation it had on the raises over to NNSA, but Lance Nyman, the agency’s contracting official for MFFF, said those documents did not justify the pay increases.