Is Redflex Traffic Systems outsourcing US engineering jobs for cheaper Australian labor? That is the question the US Department of Labor is now investigating, adding to the numerous inquiries into the Melbourne, Australia-based firm's business practices. The second largest provider of photo enforcement services in the United States was recently caught violating labor laws in California. It is the subject of a massive federal bribery investigation and charges of racial bias. Redflex was even fined by the Federal Communications Commission in 2008 for illegally importing uncertified radar units.

The new charges stem from Randall Bass, Ngoc Nguyen and Bob Hervey, engineers who until recently worked out of the Arizona office of Redflex. They were fired in May of last year and turned to the Labor Department for help.

"Redflex Traffic Systems has two divisions, one in Phoenix and one in Melbourne, Australia," the engineers wrote in their petition to the Labor Department. "The engineering department at the Phoenix location was tasked with research and development (R&D) of new and existing systems specific to the US market. This engineering department was closed, with all R&D effort transferred to the Melbourne division. Of the five systems engineers at the US office, three engineers were laid off and two engineers were transferred to support engineering under different management."

On the first review, Redflex escaped blame because the engineers it hired were based in Australia and not brought into the US.

"The initial investigation resulted in a negative determination based on the findings that the subject firm did not shift to, or acquire from, a foreign country the services provided by the workers of the subject firm; further, neither the subject firm nor its customers imported services like or directly competitive with the services supplied by the workers," Labor Department Certifying Officer Del Min Amy Chen explained.

The engineers appealed, offering new documentation to show that they did indeed qualify for Trade Adjustment Assistance, which provides job training and other financial subsidy for US employees affected by trade-related job loss.

"After careful review of the application, I conclude that the claim is of sufficient weight to justify reconsideration of the US Department of Labor's prior decision," Chen said. "The application is, therefore, granted."

While the investigation is ongoing, a Labor Department spokesman declined to discuss the reason for the reversal. While there is no formal deadline, a final decision could come within the next month or so.

A copy of the notice of reconsideration is available in a 200k PDF file at the source link below.