US Labor Secretary Thomas E. Perez Announces Proposed Rule to Raise the Minimum Wage for Federal Contract Workers

Posted by National Alliance for Fair Contracting on

WASHINGTON – Fulfilling President Obama’s commitment to make 2014 a year of action to strengthen the economy and grow the middle class, U.S. Secretary of Labor Thomas E. Perez today announced a proposed rule raising the minimum wage for workers on federal service and construction contracts to $10.10 per hour. The proposed rule implements Executive Order 13658, which was announced by the president on Feb. 12.

“A core American value is that hard work should be rewarded with fair pay. And as the president said in his State of the Union address, if you cook our troops’ meals or wash their dishes, you shouldn’t have to live in poverty,” said Secretary Perez. “Raising the minimum wage for workers on federal contracts will provide a much needed boost to many who are working hard, but still struggle to get by, and it will also benefit taxpayers with improved employee retention and productivity. Today the department took an important step toward making the promise of the executive order a reality for thousands of workers.”

“In America, nobody who works full time should have to raise their family in poverty,” said White House Domestic Policy Director Cecilia Muñoz. “President Obama is leading by example, raising the minimum wage for federal contract workers, and governors, mayors and businesses around the country are answering the call to join him. Now it’s time for Congress to finish the job and raise the wage for everyone.”

US Department of Labor’s OSHA Cites Duce Construction for Failing to Protect Employees from Trench Dangers

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SAVOY, Ill. – The U.S. Department of Labor’s Occupational Safety and Health Administration has cited Duce Construction Co. with four safety violations, including three serious and one willful, for failing to protect workers from trenching hazards at a job site on East Airport Road in Savoy. OSHA opened the February 2014 inspection under theNational Emphasis Program for trenching and excavation. Proposed penalties total $59,500.

“It is unacceptable for Duce Construction to allow workers into an unprotected trench. Each year, trench collapses result in numerous deaths and serious injuries,” said Thomas Bielema, OSHA’s area director in Peoria. “Employers that specialize in this type of work must take all necessary precautions to ensure their employees have safe working conditions.”

There were two trench boxes used in the excavation. Workers were exposed to soil avalanching and cave-in hazards because the company failed to ensure that the boxes were used correctly. A willful violation was cited for failing to ensure workers were protected from these hazards. A willful violation is one committed with intentional, knowing or voluntary disregard for the law’s requirements, or with plain indifference to worker safety and health.

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State Suspends Concrete Contractor After Price-Fixing Plea

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A concrete contractor convicted of fixing prices for ready-mix concrete in Iowa can no longer receive contracts from the Minnesota Department of Transportation.
This month’s MnDOT suspension order for GCC Alliance Concrete grew out of a federal probe that revealed four concrete makers in Iowa conspired for three years to fix prices and rig bids for contracts. The investigation sent at least two executives to prison, including former GCC sales manager, Steven VandeBrake, who is close to finishing a 48-month sentence.

Under state law, Minnesota has to cut ties with contractors convicted of crimes. The company itself was charged criminally (yes, that can happen) and pleaded guilty in 2011 to violating anti-trust laws. Its punishment: 18 months probation, as well as $100,000 in free concrete for the paving and masonry needs of local non-profit organizations.

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Nearly $5M in Back Wages for Approximately 500 Workers at Federally-Assisted Project in New York Secured by US Labor Department

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NEW YORK – MDG Design & Construction LLC has reached a settlement with the U.S. Department of Labor that resolves wage violations at the federally-assisted Grand Street Guild construction project in New York City’s Lower East Side. MDG and other respondents will pay $3.8 million in back wages and fringe benefits to about 200 of MDG’s subcontractors’ construction workers. Previous, separate investigations led to the repayment of more than $1.1 million in back wages to approximately 300 laborers and mechanics who worked for MDG’s subcontractors on the Lower East Side project.

MDG was the general contractor for the Grand Street Guild project, which involved the refurbishment and rehabilitation of three 26-story apartment towers. The department’s Wage and Hour Division found numerous Davis-Bacon and Related Acts violations by MDG subcontractors on the project, including failure to pay required prevailing wages and submitting inaccurate or falsified payroll records to the government.

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New York’s De Blasio Seeks to Drop Wage Law Challenge

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New York Mayor Bill de Blasio is seeking to drop his predecessor’s challenge to a law requiring landlords and companies getting economic aid from the city to pay workers the same wages as employees of its contractors.

The city asked state Supreme Court Justice Geoffrey D. Wright in court papers today to void his ruling from August of last year invalidating the prevailing wage measure, saying the court failed to recognize the city’s authority to incorporate wage standards into its commercial transactions.

The city council passed the bill 44-4 in May 2012 over former Mayor Michael Bloomberg’s veto. Bloomberg sued the council two months later, saying the requirement would increase costs and was pre-empted by the state’s minimum-wage law.

The law requires any company receiving at least $1 million in economic development aid from the city to pay its workers the prevailing wage — the rate set by law for each trade or occupation for employees of contractors who do public works projects and building service work for government agencies.

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In Support of Prevailing Wages

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As Mayor and Vice Mayor of Vacaville, we have unique knowledge of the impact of public construction projects both on taxpayers, and our local economy. Taxpayers expect our public works to be done right, and cost effectively. And our community benefits when these projects employ local workers at decent wages.

That’s why last year we passed a resolution in support of SB7 – a new state law that encourages more cities to pay prevailing wage on public construction projects.

And it’s why today, we are disappointed to see some California cities filing suit to block this law.

Research clearly demonstrates that prevailing wage projects don’t cost any more than those built by low wage, less skilled workers. In fact, prevailing wage projects often save taxpayer dollars as a result of the projects having fewer change orders, fewer delays, and fewer accidents.

The reason is simple: Prevailing wage projects are built by the best trained workers available. Prevailing wage workers tend to be higher skilled because these projects help fund training programs that not only ensure that we get top quality completed project, but that we have a well trained workforce in the future to support our growing infrastructure needs.

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Lansing Prevailing Wage Law Upheld in Michigan Court of Appeals Decision

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LANSING — A prevailing wage law passed by the city of Lansing does not violate the Michigan Constitution nor home rule restrictions passed by the Michigan Legislature, a divided Michigan Court of Appeals panel decided Wednesday.

The decision overturns a lower court ruling in favor of Associated Builders and Contractors, which had challenged the Lansing ordinance as unconstitutional, and says a 1923 court decision that barred cities from setting prevailing wage laws has been superseded by decisions over the last 90 years.

Lansing’s ordinance requires contractors working on city construction projects to pay a prevailing wage, which ABC had challenged as being outside the city’s authority under state law. ABC also cited a 1923 Michigan Supreme Court decision that barred the city of Detroit from enforcing a prevailing wage law. That opinion concluded that unless the state had given cities the authority to set such laws, cities could not enact rules governing wages.

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(Copy of Decision)

Collaborative Development: The Benefits of Public-Private Partnership

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A new ILEPI Policy Brief, released this morning, investigates the pros and cons of public-private partnerships in the construction industry.

The report, Collaborative Development: The Pros and Cons of P3s on Construction Projects (PDF), finds that public-private partnerships (P3s)- such as the proposed Illiana Expressway– offer the potential for significant cost savings for the public sector. P3s allow governments to increase internal investment, capitalize on the efficiencies and innovations of private companies, and build infrastructure slightly less expensively and slightly more quickly. For the private sector, P3s provide stable assets (infrastructure facilities) with predictable long-term returns from user fees for portfolio diversification. P3s also allow private entities, backed by the government, to borrow cheaply.

The Policy Brief utilizes case studies to demonstrate how P3s may be mutually beneficial and discusses the expected positive benefits of three potential P3 projects in the Midwest.

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Arizona Utility Subcontractor Debarred From Federally Funded Projects

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PHOENIX — The U.S. Department of Labor has recovered $198,085 in back wages for 23 workers employed by Glendale-based Tierra Contracting Inc. for willful violations of the Davis-Bacon and Related Acts and the Contract Work Hours and Safety Standards Act. Tierra Contracting and its owner, Richard Juarez Sr., also have been debarred from applying for federally funded contracts for a period of three years because of the egregious nature of the violations found.

Investigators with the department’s Wage and Hour Division in Phoenix established that Tierra Contracting failed to pay the required prevailing wage rates and fringe benefits to power equipment operators, water truck drivers, pipe layers, grade setters and laborers working at the federally funded Northern Parkway highway project in Maricopa County. Tierra Contracting routinely submitted certified payroll records that did not accurately reflect the real hours worked by the affected employees. Employees were paid for overtime hours with separate checks, off-the-record and at straight-time rates, without the additional time-and-a-half, as required.

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16th Annual NAFC Conference Registration

Posted by National Alliance for Fair Contracting on

The National Alliance for Fair Contracting will be holding its 16th Annual Conference this year in the lakeside city of Chicago, IL, September 17-19, 2014.

The NAFC Conference provides a national forum for those committed to combating noncompliance of state and federal public contracting laws and draws attendance from contractors, labor unions, fair contracting organizations, attorneys and various officials from local, state and federal governments around the nation.

This year’s conference will be hosted at the Sheraton Chicago Hotel and Towers. NAFC Chairman Rocco Davis and the rest of NAFC’s Board of Directors are diligently planning content and speakers to ensure this will be our most successful conference to date. 

Register Now