Cambridge Takes Steps to Protect Workers from Wage Theft (MA)

Posted by National Alliance for Fair Contracting on

03/18/2016
Richard Rogers and Darlene Lombos

This week, workers in Cambridge, Massachusetts, gained new protections for making sure they are paid fairly and on time. On March 14, city manager Richard Rossi signed an executive order establishing certification requirements for vendors bidding on city contracts. The measure seeks to prevent wage theft, which is the improper withholding of payment from employees and the failure to pay employees according to required schedules. Wage theft most often involves employers paying less than the minimum, contracted or prevailing wage, not paying for all hours worked, or not paying overtime for hours exceeding 40 per week. But wage theft can take many forms-employers may never send the final paycheck or may misclassify workers as independent contractors.

“This executive order is a clear indication of Cambridge’s continuing commitment to wage justice,” Rossi said. “The provisions put into effect today provide the city the protections that are needed to ensure that we are dealing with quality contractors. We have created a simple and fair process for both the city and for our contractors.”

Under the executive order, vendors bidding on city contracts will be required to certify their compliance with federal and state wage law with the city, and if the vendors have previous violations, they are required to disclose them and provide a wage bond for the duration of the contract. These measures strengthen the city’s ability to hire vendors that treat their employees fairly.

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The Fight Against Wage Theft

Posted by National Alliance for Fair Contracting on

by Chaz Bolte
March 8, 2016

In some instances, simply being a community advocate for local workers’ rights is what it takes to further establish the IUPAT positive force, and a way of life, for local residents.

Wage theft, the illegal practice of not paying workers for all of their work by violating minimum wage laws, not paying overtime, denying them breaks and making them work off the clock, is a major problem in the United States.

According to a study for the National Employment Law Project, the UCLA Institute for Research on Labor and Employment and the Center on Urban Economic Development:

  • Fully 26 percent of workers were paid less than the legally required minimum wage in the previous work week.
  • More than a quarter of respondents worked more than 40 hours during the previous week. Of those, 76 percent were not paid the legally required overtime rate by their employers.
  • Women were significantly more likely than men to experience minimum wage violations, and foreign-born workers were nearly twice as likely as their U.S.-born counterparts to have a minimum wage violation.
  • Foreign-born Latino workers had the highest minimum wage violation rates of any racial/ethnic group. But among U.S.-born workers, there were significant race differences: African-American workers had a violation rate triple that of their white counterparts.
  • Some 86 percent of respondents worked sufficient consecutive hours to be legally entitled to at least one meal break during the previous week. Of these workers, more than two-thirds (69 percent) received no break at all, had their break shortened, were interrupted by their employer, or worked during the break-all of which constitute a violation of meal break law.

 

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(Click here to view PDF of Study)

 

FIVE DEFENDANTS ARRAIGNED FOR COMMITTING OVER $635,000 IN TAX AND INSURANCE FRAUD AND FAILING TO PAY EMPLOYEES PREVAILING WAGE ON PUBLIC WORKS CONTRACTS

Posted by National Alliance for Fair Contracting on

Case # 16CF0765
Date: April 13, 2016

SANTA ANA, Calif. – Five defendants were arraigned yesterday April 12, 2016, for committing over $635,000 in tax and insurance fraud and failing to pay employees prevailing wage on public works contracts. Babak Brian Abghari, 36, Newport Coast, Homayoun Harry Abghari, 57, Huntington Beach, Julio Roberto Alvarado, 47, San Pedro, Cody Lawson, 34, Long Beach, Phyllis Martinez, 51, Anaheim, are each charged with eight felony counts of taking and receiving a portion of a worker’s wage on a public work, 56 felony counts of recording a false or forged instrument, six felony counts of making a false statement to discourage an injured worker from claiming benefits, and seven felony counts of willful failure to pay taxes, with sentencing enhancement allegations for property loss over $200,000. Babak Aghari and Homayoun Aghari are also charged with three felony counts of misrepresenting facts to a workers’ compensation insurance company. If convicted, the defendants face a maximum sentence of 49 years and six months in state prison. The defendants are scheduled for a pre-trial hearing on May 12, 2016, at 8:30 a.m. in Department C-55, Central Justice Center, Santa Ana.

Houmayoun Abghari and Babak Abghari are accused of owning and operating PCN3, a general contracting company that mainly conducts public works projects.

Between Jan. 1, 2000, and March 30, 2015, the defendants are accused of fraudulently paying PCN3’s employees less than the prevailing wage in cash, and keeping the extra money owed to their employees. The defendants are accused of “shorting” the victims’ hours on certified payroll reports and/or requiring their victims’ to give cash back.

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School Construction Authority General Contractor Sentenced To 96 Months In Prison For Long-Running Scheme To Deprive Workers Of The Prevailing Wage

Posted by National Alliance for Fair Contracting on

Department of Justice
U.S. Attorney’s Office
Eastern District of New York

Friday, April 1, 2016

Earlier today in Brooklyn federal court, Muzaffar Nadeem, the owner of SM&B Construction Co., Inc. (SM&B), was sentenced to 96 months’ imprisonment, ordered to pay more than $1.3 million in restitution to the IRS, and ordered to forfeit to the government over $7.1 million in criminal proceeds, following his convictions on May 8, 2015, after a four-week jury trial, for mail and wire fraud, structuring financial transactions, federal programs bribery, making illegal cash payments to a union official, money laundering, unlawful monetary transactions over $10,000, subscribing to false tax returns, and multiple related conspiracy charges.

The convictions arose out of Nadeem’s leadership role in a long-running scheme to pay SM&B’s workers a fraction of the prevailing wage on projects funded by the New York City School Construction Authority (SCA), as SM&B was legally and contractually required to do. Nadeem’s co-conspirators Zainul Syed, Afzaal Chaudry and Irfan Muzaffar were also convicted at trial of various crimes for their participation in this scheme. Muzaffar was previously sentenced to 18 months’ imprisonment, and Chaudry was previously sentenced time served, following approximately ten months of imprisonment. Syed is awaiting sentencing. The sentencing proceedings were held before U.S. District Judge Brian M. Cogan.

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A.G. Schneiderman and Port Authority Inspector General Nestor Announce Arrest of JFK Contractor Charged With Cheating Construction Workers Out of Benefit Payments

Posted by National Alliance for Fair Contracting on

Arbor Concrete Corp. And Its Principal Kenneth Padover Allegedly Failed To Pay $268,055.78 In Benefits To Workers For A Construction Project At JFK Airport

March 31st 2016

NEW YORK – Attorney General Eric T. Schneiderman and Michael Nestor, the Inspector General for the Port Authority of New York and New Jersey (“Port Authority”), announced the arrest of Kenneth Padover, the owner of Arbor Concrete Corp. Padover and his company face 136 felony counts of Offering a False Instrument for Filing and Falsifying Business Records and 3 misdemeanor counts of Failure to Pay Wages. Mr. Padover was arrested early this morning outside of his Dix Hills residence and is expected to be arraigned today at Queens County Criminal Courthouse. A felony complaint was filed today in court. Arbor Concrete Corp. and its principal Kenneth Padover allegedly failed to pay $268,055.78 in benefits to workers for a construction project at JFK Airport.

“My Office will not sit idly by when New York workers are cheated out of their health benefits, vacation pay and potential pension income,” said Attorney General Schneiderman. “Government contractors who fail to pay the legally required wages or benefits must be held accountable and my office will continue to prosecute employers who do not pay workers everything they are lawfully owed.”

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DEFENDANT FACES ADDITIONAL CHARGES FOR ATTEMPTING TO TAKE RESTITUTION MONEY FROM VICTIMS

Posted by National Alliance for Fair Contracting on

*Defendant was also previously charged for conspiring to underpay employees on public works projects

Case # 16CF0632, 15CF1672

Date: March 14, 2016

SANTA ANA, Calif. – A defendant faces additional charges for attempting to take restitution money from victims in another open case. No Sung Pak, 75, Hollywood, is charged with two felony counts of attempted taking and receiving a portion of a worker’s wage on a public work, and a sentencing enhancement for crime-bail-crime. If convicted, he faces a maximum sentence of three years and 10 months in state prison for these charges. He was arraigned Friday, March 11, 2016, and is out of custody on $25,000 bail. He is scheduled for a pre-trial hearing May 26, 2016, at 8:30 a.m. in Department C-55, Central Justice Center, Santa Ana.

Pak and co-defendants Michael John Ferrin, 40, San Pedro, and Scott Sung Yang, 45, Los Angeles, are also each charged with five felony counts of taking and receiving a portion of a worker’s wage on public works and one felony count of recording a false forged instrument. Pak is additionally charged with 29 felony counts of willful failure to pay tax, two felony counts of misrepresenting facts to State Compensation Insurance Fund (SCIF), two felony counts of misrepresenting facts to workers’ compensation insurance company. If convicted, Pak faces a maximum sentence of 27 years and four months in state prison for these charges, and Ferrin and Yang each face a maximum sentence of five years and four months in state prison. Ferrin and Yang are out of custody on $50,000 bail. They are scheduled to be arraigned on May 26, 2016, at 8:30 a.m. in Department C-55, Central Justice Center.

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City to deny permits to companies with wage theft convictions (TX)

Posted by National Alliance for Fair Contracting on

POSTED: 05:22 PM MST Mar 08, 2016
UPDATED: 07:24 PM MST Mar 08, 2016

EL PASO, Texas –
The El Paso City hall is cracking down on wage theft, adding changes to an existing ordinance that will prohibit companies in some industries from conducting business within city limits if they’ve been convicted of stealing wages from employees.

The council on Tuesday voted 5 to 1 to approve the tougher changes, with Rep. Michiel Noe as the only no vote. Representatives Cortney Niland and Larry Romero were absent. Romero resigned last month but is still a holdover until his seat is filled.

Businesses with a wage theft adjudication would not qualify for certain city permits, licenses or registration. The industries affected are food handling establishments, laundries, dealers of second hand goods, vendors, contractors and flea market operators.

The current city ordinance bars companies with wage theft adjudications from winning city contracts.

More than two dozen people went to the city council meeting expressing support for the ordinance expansion. “El Paso does not need employers who are thieves,” UTEP Professor Kathy Staudt told the council.

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MnDOT contractor who shorted workers $242K is convicted of theft by swindle

Posted by National Alliance for Fair Contracting on

$242,000 case involved co-owner of firm hired for MnDOT project.

By Paul Walsh Star Tribune
MARCH 8, 2016 – 8:09PM

A co-owner of a Twin Cities electrical contracting company has been convicted of cheating nearly two dozen employees out of a total of $242,000 in wages by paying them far less than the law required for their work on a state highway project in the north metro and elsewhere.

Laura Plzak, 54, of Loretto, was convicted in Hennepin County District Court of 16 felony counts of theft by swindle.

County Attorney Mike Freeman praised the bench verdict issued by Judge Tamara Garcia, calling it “a good decision, based on the enormous amount of evidence gathered by the FBI and the Minnesota Department of Transportation.”

Freeman said Monday that Plzak was “driven by greed, pure and simple, and it was the hardworking electricians who suffered.”

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White House Holds Meeting at Kilmer’s Request to Promote the Hiring of Local Workers on Federal Construction Projects

Posted by National Alliance for Fair Contracting on

April 12, 2016
by RealEstateRama

Washington, D.C. – (RealEstateRama) – Representative Derek Kilmer (D-WA) joined U.S. Secretary of Labor Thomas E. Perez and Director of the White House Domestic Policy Council Celia Munoz at the White House with a local labor leader, members of Congress, and other officials for a meeting on growing opportunities for local workers that can make it easier to complete large, complex construction projects on time and under budget.

The discussion focused on the benefits of increasing the number of Project Labor Agreements (PLAs) to put more skilled local workers on federal construction projects. Kilmer highlighted the future Bangor Explosive Handling Wharf, now under construction in Kitsap County under a PLA, as an example of how the agreements can work.

PLAs have proven to be successful management tools that provide cost effective and timely completion of high-quality federal projects. In 2009, President Obama issued Executive Order 13502 to promote the use of PLAs in federal projects.

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University of Minnesota unit examines wage theft issues

Posted by National Alliance for Fair Contracting on

By Randy Furst Star Tribune
MARCH 23, 2016 – 6:12PM

A series of articles and videos about “wage theft” appeared last month on a University of Minnesota website, describing how a large number of workers in Minnesota are routinely not paid overtime, shorted in paychecks or not paid at all.

Those practices, which violate state and federal law, are described in detail at workdayminnesota.org, which is sponsored by the Labor Education Service, a unit at the U’s Carlson School of Management.

The subject is also being discussed at Minneapolis City Hall as one of the pillars of Mayor Betsy Hodges’ Working Families Agenda. But it’s unclear so far what role the city may play in cracking down on wage theft.

The Workday articles offer a glimpse into the myriad problems of lower paid workers, often undocumented, who are sometimes reluctant to challenge employers for fear of being fired or even deported.

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