Inclusion Daily Express -- Compliance Problems With Federal Contracts Could Mean Layoffs For Thousands

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Compliance Problems With Federal Contracts Could Mean Layoffs For Thousands
By Dave Reynolds, Inclusion Daily Express
March 28, 2006

EL PASO, TEXAS--The nation's largest nonprofit to benefit from a federal program designed to employ workers with disabilities announced Monday that it would start laying off other workers amid allegations that it has been violating terms of its contracts.

Joe Wardy, president and CEO of the National Center for Employment of the Disabled, said in a press conference that workers who do not have disabilities have been notified that layoffs could begin this week. Wardy said that an estimated 1,250 of the nonprofit's 4,000 employees could be affected, as early as this week.

Last year, the federal government paid NCED $275 million to manufacture such things as chemical warfare protective suits, military uniforms and accessories, and cardboard boxes, under the 1938 Javits-Wagner-O'Day Act (JWOD). Under that law, the organization is required to have 75 percent of the labor performed by workers who are "blind or severely disabled". But a report done last fall by the El Paso Times led federal investigators to find that the company could only account for 7.8 percent of the work being performed by such workers.

A former NCED employee also reportedly showed the Times documents suggesting that the nonprofit was having other container companies make boxes that were then stamped with NCED logos.

NCED officials have repeatedly denied the allegations that they employ so few workers with disabilities, and blame the low numbers on paperwork problems.

The President's Committee for Purchase from People who are Blind and Severely Disabled, which enforces JWOD rules, is expected to decide over the next two weeks whether the federal government should end its relationship with NCED.

The Defense Supply Center in Philadelphia already suspended orders with NCED for chemical suits and combat uniforms in February and March. Last year, the center paid NCED $172 million to make 724,000 chemical suits and $48 million for 1.3 million sets of Army combat uniforms.

Last October, the U.S. Senate's Health, Education, Labor and Pensions Committee heard testimony that executives of many nonprofits under JWOD contracts were earning salaries well into six figures, at the same time that many workers with disabilities were stuck in sheltered workshops, discouraged from seeking work in the community.

Related:
"Nonprofit's shaky future worries area agencies" (El Paso Times)
"Nonprofit's new CEO says layoffs may begin" (El Paso Times)

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