Norfolk prosecutors looking into complaints about employment company

Jessica Holubik got married last year and moved to Hampton Roads from Chicago, leaving her job in a medical billing office.

The Navy wife hoped to find work here quickly, but even a couple of fast-food restaurants turned her down. Late last summer, the Portsmouth resident saw an advertisement for an administrative assistant position paying $12 to $14 an hour. She called the number and made an appointment.

When she arrived at the office building on Military Highway in Norfolk, Holubik realized she wasn't at a job interview; she was at an employment services agency that was then called Virginia Personnel. Its representatives mentioned nothing about the advertised position but told her she could pay a $365 fee for help getting work.

Holubik agreed to an initial installment of $130. Back home, she looked up the company on the Internet and found numerous complaints. She decided against paying more.

"They told me that they were going to place me with a job," said Holubik, 22. "They told me these jobs were guaranteed."

The Norfolk commonwealth's attorney's office is looking into "several dozen" consumer complaints about Virginia Personnel Inc. and Virginia Employment Services Inc., the new name of the company at 870 N. Military Hwy., Suite 112, said Amanda Howie, a spokeswoman for the office. She said prosecutors are working with Norfolk Police Department investigators to determine whether they can bring criminal charges.

In 2005, city prosecutors went after another company run by the same people - Karla O'Leary and James O'Leary - and that business then closed. A business owned by the O'Learys in Ohio has been banned from operating in that state.

James O'Leary, president of Virginia Employment Services, faxed a written response to questions. He called VES a "membership organization" for job seekers with a one-time membership fee of $365.

"The appointment with our company is free, and we do not charge a fee for a job," O'Leary wrote. "The membership provides the client appointments with our service specialist department, where the client will receive information regarding active job postings. Companies seeking employees list their job postings with our organization, saving the company time and money."

O'Leary wrote that he would "welcome the opportunity to address any valid complaints" but did not answer several questions from The Virginian-Pilot.

"So many people are desperate for jobs," Holubik said. "They know that. They're preying on people that have problems getting jobs."

Holubik later found an $11-an-hour job as an administrative assistant through a temporary placement service.

"It all worked out," she said, "and I didn't pay anything."

Employment experts and consumer advocates said workers should not have to pay to get a job.

With 55,880 people out of work in Hampton Roads in March - up more than 80 percent from the same month last year - job-assistance companies are seeing a boom in their potential market. High unemployment makes it more difficult for would-be workers to secure a job and puts extra pressure on them to do anything for one - even to pay.

Representatives of five job-placement agencies with local offices - Adecco USA, Don Richard Associates, The Lee Group, Randstad and Spherion Staffing - all said they make their money by charging fees to employers in exchange for finding them possible workers.

An employment service asking for payment from job seekers should send up a red flag.

"That would be a neon sign to turn around and walk out," said Kelly Woodruff, the Hampton Roads branch manager for Adecco.

Kelly Riley, the senior area vice president for Randstad, agreed.

"Reputable agencies are going to work on behalf of the employee," Riley said. "We're not going to sit and wait for something to come in. We're going to skill-market them. I can't understand how anyone would be more successful by taking a fee from the person. There's nothing these people can get their hands on that we can't."

All said a job guarantee should raise suspicions.

"Right now, no one can guarantee that they have jobs for the candidates that walk in the door," said Jennifer Tomlin, chief operating officer for Don Richard Associates in Norfolk. "I think that's unrealistic."

Several hopeful workers who paid Virginia Personnel or Virginia Employment Services said representatives promised to find them employment as part of the contract fee. Despite some concern about spending the money, they said, the company's pledge convinced them to go forward.

"They said they would definitely find me a job - 100 percent guaranteed. They would definitely find me one," said Robyn Headley, a Hampton resident who took Virginia Personnel to court late last year and won a judgment against the company in General District Court in Norfolk.

Before she could collect, however, Virginia Personnel shut down and became Virginia Employment Services. Headley, 25, then sued the O'Learys. In February, prior to a ruling in that case, Karla O'Leary sent Headley a check for $525 to cover the amount the company withdrew from her bank account, plus interest and court costs, she said.

Several people who pursued jobs through Virginia Personnel and VES said the companies never arranged actual interviews or directed them to jobs they couldn't find elsewhere. When Mariah Frazier, then 19, called for a job appointment, Virginia Personnel told her to visit White's Nursery in Chesapeake, sometime between 9 a.m. and 4 p.m., said her mother, Allegra Frazier.

Mom was skeptical. She wondered what kind of interview is scheduled without a contact person and a specific time. The Chesapeake resident called the nursery and learned that the employer had never heard of Virginia Personnel and was not expecting Mariah Frazier for an interview.

Newport News resident Richard Dion had the same experience with Virginia Employment Services in recent months. VES set up appointments for him, but each employer either told him the job had long since been filled or asked him to fill out an application as though he walked in off the street.

"Most of the places we went to never heard of VES, never talked to anyone from VES," said Dion, 43, a retired Navy petty officer fir st class. "I'm paying for services I'm not getting. That's like making payments on a car I never got."

Some clients who walked away from Virginia Personnel before receiving any job services said the company deducted the fees from their bank accounts. Headley and Mariah Frazier said they gave account information and agreed to initial, partial payments. The company withdrew the full fee amount of $365 without telling them. Both said they incurred overdraft or bounced check fees.

O'Leary, in his written response, declined to discuss Virginia Personnel because that company was "dissolved." In regard to VES, he said, "The membership fee does not warranty success in obtaining a position."

The Better Business Bureau gives Virginia Employment Services a "D-" rating, citing six complaints received about the company. VES has refunded fees to some of those who complained, the bureau reported.

The Norfolk commonwealth's attorney's office sued a predecessor company in December 2005, when it operated under the name Jobs Plus Inc., alleging violations of the Virginia Consumer Protection Act. Jobs Plus signed an agreement to stop certain practices, such as misrepresenting job availability or making guarantees about employment or salaries, but the agreement didn't stop the company from shutting down and opening under a different name.

In their corporate registration filings with the state, Jobs Plus, Virginia Personnel and Virginia Employment Services all list James O'Leary as an officer or director. Jobs Plus, which had the same address and suite number on Military Highway, and Virginia Personnel both list Karla O'Leary as an officer. All three companies have the same registered agent, J. Roger Griffin Jr., a Virginia Beach attorney.

In April 2008, a judge in Ohio ordered the O'Learys to shut down a similar employment services business, Global Personnel Inc. in Columbus. Less than a year after Global started operating, the Ohio attorney general charged it and the O'Learys - with home addresses listed in Chesapeake and Virginia Beach - with unfair and deceptive practices.

The judgment prohibits the O'Learys from starting another business in that state without the attorney general's permission, said Mike Sliwinski, the assistant attorney general in Ohio who handled the case. The company had to pay about $20,000 to refund clients, plus civil penalties.

"We had a pretty high number of complaints in a small time period, particularly for the size of their business," said Sliwinski, explaining that he tried to act quickly to protect the finances of the unemployed victims. "That was one of my big concerns, because obviously we were dealing with people who were out of work and were on their last dime."

In Virginia, the O'Learys have remained in business for at least 19 years, according to state documents. VES recently ran job ads for laborers, construction workers, landscape helpers, clerks and cleaning/janitorial positions in the Daily Press, and Dion saw the company's ads online on Craigslist.

The Virginian-Pilot does not accept advertising from Virginia Employment, said Kelly Warren, The Pilot's advertising director, who declined to explain why.

The Virginia attorney general's office is aware of complaints against the companies, spokesman David Clementson said. He said he cannot comment on why the office has not taken action or whether it will.

Some workers who sought help from VES and Virginia Personnel said they would like state law enforcement officials to put a stop to such practices.

Allegra Frazier has written to the attorney general and state legislators about the company. She said the $365, which she helped her daughter cover, isn't her concern.

"I don't like people to be taken advantage of," Frazier said. "I just can't stand the thought of people - especially in these times - getting ripped off by the company."

 Carolyn Shapiro, (757) 446-2270, carolyn.shapiro@pilotonline.com

Philip Walzer, (757) 222-3864, phil.walzer@pilotonline.com