Labor organizations rally against wage theft and employee misclassification Station Row project in Providence

Posted by National Alliance for Fair Contracting on

April 22, 2018
Steve Ahlquist

The International Union of Painters and Allied Trades (IUPAT) District Council 11 held a rally Saturday afternoon in partnership with Fuerza Laboral and Rhode Island Jobs With Justice at the site of Trilogy Development’s Station Row project being built by Tocci Construction at Smith and Canal Streets in Providence.

Trilogy has received $5.6 million in public subsidies in the form of a Tax Stabilization Agreement (TSA) from the City of Providence, but, say leaders of the Saturday rally, Trilogy and Tocci have “sadly decided to use the broken model of open shop sub contracting,” adding, “Construction workers employed in the open shop model are at a greater risk of suffering substandard wages and benefits.”

“Wage theft, employee misclassification, tax and insurance fraud are all still far too
common in the industry in Rhode Island and across the country. While unionized contractors can be found to break the law as well as open shop contractors, the collective bargaining agreements in place give workers the ability to assert their rights and get remedy of grievances” said Raul Figueroa of Fuerza Laboral.

In September 2015 open shop contractor Cardoso Construction came to settlement around wage theft to pay more than $730,000 in back wages, interest and penalties under a settlement agreement with the Rhode Island Department of Labor and Training (DLT)’s Workplace Fraud Unit.

Rhode Island’s Underground Economy and Misclassification Task Force reported in 2016 that “the Division of Taxation found that 673 employees had been improperly classified as independent contractors instead of employees in 2015, ordering the offending companies to pay more than $220,000 in taxes.”

Rhode Island’s Underground Economy and Misclassification Task Force reported in 2017 that “six construction companies entered into settlement agreements with DLT where they admitted to misclassifying 33 workers on four separate construction projects “and that “The Division of Taxation found that 590 RI employees had been improperly classified in 2016, resulting in almost $5.6 million in unreported wages and an assessment of $200,988 in additional state taxes.”

“When low road employers are allowed to cheat with impunity it undercuts not only worker’s wages and conditions but also legitimate contractors who are looking to compete in doing honest business”, said IUPAT District Council 11 Business Representative Justin Kelley, noting that these issues cause a cycle of exploitation and poverty and starve our municipal and state governments of much needed revenue.

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Raimondo Speaks To Construction Unions, Supports Prevailing Wage

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The taxpayers will not get any breaks on school construction but will pay the prevailing wage, the governor signaled in a D.C. speech.

By Margo Sullivan, Patch Staff |
Apr 18, 2018 1:30 pm ET

WASHINGTON, DC – Rhode Island Gov. Gina Raimondo told the Building Trades unions she is running for another term, and she supports the prevailing wage. Raimondo delivered a speech in Washington, D.C. on Wednesday. In her remarks, she mentioned the projects her administration has undertaken to put construction workers back on the job. Among the projects, she included her $1 billion plan to replace and rebuild the public schools.

State Rep. Patricia Morgan, a declared Republican candidate for governor, had suggested saving the taxpayers money by not paying the prevailing wage for the school construction jobs. But Raimondo, without mentioning Morgan, stood squarely with the unions and demands for the prevailing wage. The unions had a seat on the panel that developed the billion dollar plan for the schools. No taxpayer groups were represented.

Here is the governor’s speech.

Introduction
Thank you! I love having the opportunity to spend time with people who build things.

Thank you Sean McGarvey. I am so grateful for your friendship and support, and for inviting me back to speak here once again. Brent Booker, thank you for your leadership and for everything you do to support America’s tradesmen and tradeswomen. Terry O’Sullivan, you’re incredible – I’m so thankful for our partnership.

Armand Sabitoni – the pride of Rhode Island! I could not ask for a better friend or supporter. You are a champion for the building trades and you deserve so much credit for all of the exciting development that’s happening back home in our small state.

And to my own local leaders: Michael Sabitoni, Tim Byrnes, and Scott Duhamel, thank you for everything you’ve done to strengthen Rhode Island’s middle class. We’re not done yet. Let’s keep going, and let’s keep building.

Rebuilding the Middle Class Deal
For decades, there was a deal in America: if you worked hard and did what was expected of you, then you could raise a family with dignity and security. You could own a home, save for retirement, help your children pay for school, and even take time to visit beautiful beaches like the ones we have in Rhode Island!

In recent years, though, that “deal” has come under attack. There are powerful forces in America that have been working to ensure that a privileged few do well, without any concern for what happens to American workers.

In my state, the building trades got crushed by the recession. As recently as 2012, nearly one out four Rhode Islanders in the building trades were unemployed. When I was running for Governor, I would talk to tradesmen and tradeswomen. They’d been out of work three months, four months, nine months, a year. They were losing their homes. Losing their marriages. Losing their pride.

We had to do something. Back in 2014, across Rhode Island, there weren’t any jobs for laborers, but there was so much work to do.

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Lake County commissioners OK updated responsible contractor checklist

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By Andrew Cass, The News-Herald
POSTED: 04/30/18, 3:22 PM EDT

A sizable group of labor union representatives packed into the Lake County commissioners’ chambers to show support for a resolution updating the county’s responsible contractor checklist for infrastructure projects

Commissioner John Hamercheck said the resolution was part of a yearlong process, gaining steam in the past three months. It passed unanimously at the board’s most recent meeting.

“It sets the rules for how we’re going to do capital improvements at the county level,” Commissioner Daniel P. Troy said.

Troy also said he thinks that it ensures that the taxpayers – who are paying for the projects, be it through federal, state or local funds – are getting the best return on their investment.

“The way I look at it, it’s putting this in place so we’re not sitting here trying to determine who is the lowest bidder and who is the best bidder,” he said. “It’s still the law, but sometimes that becomes very difficult.”

Basically, he added, they’re setting criteria that is going to help ensure they pay “the right people the right amount of money to do the job the right way the first time.”

“What we’re looking for in this responsible contract language is furnishing of records as to that contractor’s performance on other projects, how they have complied with statutes that we have to comply with in terms of prevailing wage, payments of benefits etc.,” he said.

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The Effect of Prevailing Wage Repeals on Construction Income and Benefits

Posted by National Alliance for Fair Contracting on

Feb. 2018

Journal of Public Works Management and Policy

Ari Fenn, Zhi Li, Gabriel Pleites, Chimedlkham Zorigtbaatar and Peter Philips – University of Utah

While considerable research has examined the effects of prevailing wage law repeals on construction wages, little has been done on the repeals effect on benefits. Based on state-level data from the quinquennial Economic Census for construction from 1972 to 2012, we find that depending on sample and model specification, statewide annual average construction blue-collar income fell by 1.9% to 4.2%. Statewide annual average legally required benefits (social security, workers injury-compensation insurance, and unemployment insurance contributions) for blue- and white-collar construction employees combined fell from 3.8% to 10.1%. Statewide annual average voluntary benefits (primarily health insurance, pension contributions, and apprenticeship training) for blue- and white-collar construction employees combined fell from 11.2% to 16.0%. Because prevailing wage laws govern only blue-collar construction remuneration, blue-collar benefits probably fell more than blue- and white-collar benefits taken together.

(Download Full PDF Here)

Ensuring Government Spending Creates Decent Jobs for Workers

Posted by National Alliance for Fair Contracting on

By Karla Walter
Posted on January 29, 2018, 9:53 am

The federal government spends more than $1 trillion every year though contracts, grants, and other funding vehicles to deliver essential goods and services. It funds everything from the design and manufacture of sophisticated weapons systems to the construction of roads, bridges, and dams; from in-home care for aging Americans and those with disabilities to financial assistance programs that allow veterans and working families to access higher education. This spending creates tens of millions of jobs throughout the economy.

American policymakers have long harnessed the power of this spending by requiring recipients to create decent jobs. Yet today, these protections cover less than half of all spending, and too often, even the jobs covered by existing protections pay poverty wages.
Moreover, some anti-worker lawmakers are threatening to dismantle even these standards.

Job quality standards should apply to all taxpayer-supported work regardless of whether it is financed through federal contracts, grants, loans, or even tax incentives. Policymakers who care about workers must defend existing job protections from attacks and fight to strengthen policies to ensure that all government spending creates good jobs.

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PLAs good for construction industry

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KIMBERLY GLASSMAN
MARCH 5, 2018

On Feb. 12, an op-ed in the HBJ (“State must end project labor agreements”) by the Connecticut chapter of the Associated Builders and Contractors presented an over-simplified and inaccurate description of project labor agreements.

A project labor agreement, or PLA, is a pre-hire agreement that sets construction project employment terms. They’re often used on complex projects that require the services of multiple contractors and subcontractors over a sustained period of time. PLAs are a common procurement method for the state of Connecticut, municipalities and private developers.

The Associated Builders and Contractors (ABC) likes to tout their membership numbers. However, they represent only 1 percent of construction companies in the United States. According to the National Labor College, a meager 22,260 apprentices were enrolled in ABC programs, compared to over 420,000 apprentices enrolled in union-funded programs.

Though we appreciate ABC’s attempt to paint the use of PLAs as a partisan issue by invoking Gov. Malloy’s decision to utilize the agreements, they fail to disclose other elected leaders’ use of them. Republican Mayor Mark Boughton recently signed a PLA for Danbury High School. Former Republican Mayor John Harkins signed PLAs for both the Victoria Soto Elementary School and Stratford High School. And former Gov. John Rowland signed a historic PLA on Adriaen’s Landing in Hartford.

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US Department of Labor Wage and Hour Division Prevailing Wage Seminars

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DESCRIPTION

The Wage and Hour Division (WHD) Prevailing Wage Seminars are three-day compliance trainings designed for regional stakeholders (private contractors, state agencies, unions, federal agencies and workers).

The first two days of the seminar will consist of either courses on the Davis-Bacon Act or the Service Contract Act. The third day will feature courses concerning the Executive Orders and subject matter related to both the Davis-Bacon Act and the Service Contract Act as well as presentations from other agencies such as OSHA, Office of Federal Contract Compliance Programs (OFCCP), Housing and Urban Development (HUD), National Labor Relations Board (NLRB)

We have selected the following locations for our 2018 seminars:

If you would like to receive email updates about our seminars, please sign up for our mailing list here. (In the category “Wage and Hour” select “WHD – Prevailing Wage Seminar Announcements”)

For any questions please contact WHD-PWS@dol.gov

(Visit DOL’s WHD Website)

Oregon House OKs construction worker wage protection

Posted by National Alliance for Fair Contracting on

Contractor would have to pay under some conditions

By: KTVZ.COM news sources
Posted: Feb 26, 2018 01:30 PM PST
Updated: Feb 26, 2018 01:33 PM PST

SALEM, Ore. – The Oregon House on Monday narrowly passed House Bill 4154B, which would provide construction workers with additional wage theft protections, under certain circumstances.

The legislation, championed by Rep. Julie Fahey (D-West Eugene, Junction City, Bethel), would require a general contractor to pay the wages or benefits owed to a worker by a delinquent subcontractor if a specific set of conditions is met, according to a news release from Oregon House Democrats.

“The goal of this bill is to protect wages for workers in the construction industry by adding accountability for general contractors in certain specific situations,” Rep. Faheysaid. “When workers aren’t paid what they have earned, it hurts workers and their families. It also hurts our local economies and reduces tax revenue.”

…

This legislation would create a new process through which the construction workers employed by subcontractors would be able to claim unpaid wages.

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San Jose ballot measure would force real estate developers to hire local

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By MARISA KENDALL
PUBLISHED: February 6, 2018 at 6:00 am | UPDATED: February 6, 2018 at 6:07 am

SAN JOSE – As Silicon Valley’s housing market booms, benefiting homeowners, landlords and developers, some activists say one group isn’t reaping its fair share of the profits: the local construction workers building these expensive homes.

A new ballot measure for San Jose seeks to change that. If approved by voters in November, the “Build Better San Jose” initiative would require developers of large, private projects to hire more local workers, and pay them better.

“Workers are not paid enough to be able to afford to live in the area,” said Louise Auerhahn, director of economic and workforce policy for public policy group Working Partnerships USA, which helped draft the measure.

Responsible Development San Jose, a coalition that supports local construction workers, is set to send the initiative to city officials Tuesday, the first step to putting it before voters in November. Once it is approved by the city, it will need 21,200 signatures to make it to the ballot.

If passed by voters, the measure would require developers in San Jose to pay workers the “prevailing wage” – a payment standard set by the California Department of Industrial Relations that varies depending on a worker’s location and specific type of work.

As of last year, the prevailing wage for construction workers classified as “laborers” in Northern California ranged from about $20 to $33 per hour. Developers also would have to put forth a “best faith effort” to hire locally for at least 30 percent of a project’s hours, hiring workers who live in San Jose or within 50 miles of the city’s limits. And developers would be required to help train new local workers by using one hour of apprentice labor for every five hours worked by an experienced worker.

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A warning for Missouri: Repealing the prevailing wage on construction jobs hurts workers and the economy

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BY MARC POULOS
Special to The Star
February 20, 2018 08:30 PM

Out of all the dubious and downright absurd ideas that some state politicians have been trying to sell taxpayers in recent years, one stands out above the rest: the suggestion that the cost of building schools, highways and other critical infrastructure could be trimmed by 20 percent by eliminating the local minimum wage – or prevailing wage – on government-funded construction projects.

Setting aside the political lunacy of essentially advocating middle-class wage cuts during an era of stagnation and rising inequality, what makes this canard especially ridiculous is that construction labor represents only a little over 20 percent of the total cost of building these projects – and it’s declining.

But that didn’t stop politicians in Indiana, Wisconsin, West Virginia and Kentucky from throwing caution and basic math to the wind. Beginning with Indiana in 2015, all four states have now repealed their prevailing wage laws. Other states, including Michigan and Missouri, are now considering following suit.

New research out of Indiana is providing even more reasons why they shouldn’t.

The Midwest Economic Policy Institute and Colorado State University-Pueblo Economist Kevin Duncan have just completed the first impact study analyzing what has happened since repeal in the Hoosier State.

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