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UC Davis housing contractor gets 10 years in prison for fraud (CA)

Nov. 17, 2019

DAVIS, Calif. – A 56-year-old Colorado man who fraudulently became a UC Davis housing contractor has been sentenced to 10 years in prison for insurance fraud, wage theft, perjury and grand theft, officials said. …

Thompson then secretly ran the business using the fraudulent license, officials said.

His business was able to obtain a contract with UC Davis to build student housing. During construction, he stole more than $633,000 of his employees’ wages, defrauded the California State Compensation Insurance Fund and committed perjury to conceal his fraud. In all, he caused a total loss of more than $2 million, according to the district attorney’s office.

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Construction firms owe $1.1 million in back pay (IL)

State decision on prevailing wage follows complaint by carpenters council.

By David Roeder
Feb 24, 2020

The Chicago Regional Council of Carpenters said Monday the developer and subcontractors that built a senior living center in Northbrook have been ordered to pay $1.1 million to employees for violating state law on prevailing wages and benefits.

The Illinois Department of Labor, responding to charges the council filed, ordered the back pay for employees who constructed the Lodge of Northbrook, a 164-unit facility at 2150 Founders Drive, Northbrook. The project benefited from bonds issued by the Illinois Finance Authority, making it subject to the state’s Prevailing Wage Act. …

Executive Secretary-Treasurer Gary Perinar of the carpenters council said the back pay award is the largest in its history. He said many workers will receive thousands of dollars paid out over a year.

“We have a new department dedicated to combating wage theft and are putting unscrupulous contractors on notice that cheating workers and taxpayers will not be tolerated,” he said. The council is a part owner of Sun-Times Media. …

“Wage theft and the loss of tax revenue affects everyone,” Perinar said. “It takes advantage of workers, many of whom are unaware of their right to receive fair wages and benefits for themselves and their families. It puts signatory union contractors at a disadvantage for competitively bid projects. And it cheats communities out of tax dollars to increase future growth, new projects and public services. Thanks to our research team for discovering this injustice and to the Department of Labor for enforcing the law.”

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Study: Construction apprenticeships lead to higher average pay than college degrees in Illinois (IL)

AUTHOR: Kim Slowey
PUBLISHED: Jan. 16, 2020

Dive Brief:

  • The Illinois Economic Policy Institute, in conjunction with the University of Illinois at Urbana-Champaign’s Project for Middle Class Renewal, released the results of a study that found that those enrolled in joint labor-management registered apprenticeships experience comparable training hours, graduation rates and pay as those who attend a four-year university in Illinois. …
  • Despite the potential for periods of unemployment due to the cyclical nature of the construction industry and accounting for the gaps between when a job is over and the next one starts, a union journey worker ($2.4 million) can expect to make about as much as someone with a bachelor’s degree ($2.5 million after student debt) during the life of their career. While the total earnings figure factors in student loans, those who “earn while they learn” through apprenticeships don’t have the burden of student debt.

Dive Insight:

  • Joint construction programs have had a 54% completion rate since 2000, comparable to a public, four-year university’s rate of 61%.
  • The racial makeup of graduates from joint construction programs is similar to that of public universities in Illinois.
    Sometimes, apprenticeships in specific trades in Illinois can result in even higher wages. After completing a five-year apprenticeship through the International Brotherhood of Electrical Workers-NECA (National Electrical Contractors Association) Institute a journeyman wireman in Illinois makes more than $49 per hour.

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Following Hard Rock collapse, council and Mayor begin work on ‘responsible bidders ordinance’ (LA)

By Michael Isaac Stein
24th February 2020

A New Orleans City Council committee on February 12, heard presentations from labor union leaders, officials with the Louisiana Workforce Commission and other labor advocates about a proposal for the city to pass a “responsible bidders ordinance” in order to hold current and prospective city contractors accountable for the treatment and safety of their employees.

While the details have yet to be worked out, proponents of such an ordinance called for a requirement that companies seeking city work disclose past safety violations and labor complaints as part of their bids.

Public calls for such an ordinance have grown in the months following the October collapse of the Hard Rock Hotel on Canal Street. The incident killed three workers and injured over a dozen more.

Labor advocates told the council’s Economic Development & Special Development Projects Committee on Wednesday that such a disaster was inevitable given the current climate of construction contracting in the city. They argued that public bid laws that apply to construction contracts, which require the city to choose the firm offering the lowest price, drive companies to cut costs wherever possible to the detriment of their employees.

“This has been going on for a really long time,” said Chip Fleetwood, director of business development for the local chapter of the Painters and Allied Trades International Union. “We’re to a point where it’s almost like the wild, wild west. It was only a matter of time before something like that happened. In the building trade’s opinion, we knew there was going to be a breaking point. And we’re at the breaking point now. If something isn’t done, if we don’t really hold contractor’s accountable, it’s going to happen again.” …

Erika Zucker, policy advocate at the Workplace Justice Project at the Loyola College of Law, argued that transparency, monitoring and enforcement should all be part of the equation. She said that major changes should be made to how the city considers and chooses contractors. Instead of just relying on the lowest quote, she said that contractors should have to disclose much more info, such as past labor law and safety violations.
She also said the city should create a fair contracting task force to implement and enforce the new rules.

The Hard Rock Hotel was a private development, not a public one, so the city wasn’t party to the construction contracts. Even so, Zucker argued that a responsible bidders ordinance would still have an effect on private developments.

“The city becomes overall the most responsible contracting entity and sets an example for the region,” she said.

Zucker also argued that the ordinance should be applied to any project that are either “wholly public projects or projects that use public money that looks more like a public-private partnership, which can look like anything from a tax incentive to joint operation.”

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Attorney General finds Dracut violated procurement, wage laws (MA)

Meg McIntyre
February 11, 2020

DRACUT – A months-long Attorney General review of town procurement practices came to a head Tuesday night as the Board of Selectmen voted to approve a settlement addressing allegations that Dracut violated procurement and prevailing wage laws. …

The review also found that the town did not request the prevailing wage rate schedule from the state Department of Labor Standards prior to putting several projects out to bid, and failed to include the rate schedule in bid documents provided to bidders and selected contractors, according to the office, violating prevailing wage laws.

The settlement, which is contingent upon court approval, requires Dracut to hire an experienced procurement officer and provide training to staff on procurement and prevailing wage laws. The town will also be subject to monitoring by the Attorney General’s office going forward.

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Column: Wage theft scourge is a massive bank robbery every day (MA)

By Frank Callahan/Guest Columnist
Posted Feb 23, 2020 at 6:18 PM

The Great Brink’s Robbery, which has been upheld as the most notorious theft in the history of Boston, happened 70 years ago last month.

The brazen daytime heist, in which 11 robbers broke in and stole $2.8 million (about $30 million in 2020 money) from the Brink’s security company in the North End on Jan. 17, 1950, was at the time the largest robbery in U.S. history and dubbed “the crime of the century.” The crime prompted changes to the way companies approached security for both employees and assets. Police, politicians and the public were all focused on making sure lessons were learned and improvements were implemented.

Unfortunately, decision makers today haven’t been acting with the same degree of urgency to an equally onerous theft in our backyard. Wage theft – the practice of stealing money earned by workers – is a $700 million annual problem in Massachusetts. That’s almost $2 million a day being stolen out of the pockets of hardworking men and women, all Massachusetts taxpayers.

It is hurting the workers, who struggle from paycheck to paycheck. It hurts communities, which see its core small businesses suffer because residents have less spending power. And it hurts the entire commonwealth, whose economy suffers, leaving less revenue for crucial services like public safety, education and transportation.

Wage theft may not be as shocking as the Brink’s job, in which gang members picked locks, bound and gagged workers and dispersed into the night. Rather, today’s crooks are more likely to be wearing suits and looking their victims right in the eye while reaching around and picking the wallet from their back pocket. They’re unscrupulous contractors and subcontractors who promise to pay carpenters, pipefitters, sheet metal workers, custodians and countless other laborers agreed-upon wages and then short-change them after the work has already been done.

Frequently, there is little recourse. Maura Healey, the Massachusetts attorney general, has committed to cracking down on wage theft in the commonwealth. It’s not fair to ask Healey and her staff to take on this fight with one hand tied behind their backs.
Thankfully, there is a potential fix. There are two wage theft bills pending before the Legislature on Beacon Hill that would take this scourge head on.

Massachusetts’ Building Trades unions are urging lawmakers to pass legislation to provide Healey with greater enforcement authority. That includes enabling her office to penalize lead contractors for wage theft violations committed by their subcontractors. It would also empower the Attorney General’s office to shut down work sites until the violations are corrected.

And this legislation would pay for itself. More enforcement will lead to more recovery. In Fiscal Year 2019, the AG’s office recovered $5.8 million in restitution for these hardworking men and women – less than 1 percent of what was stolen. It stands to reason that more enforcement will return more money.

There are some champions in the Legislature who have recognized the importance of combating wage theft. Sen. Sal DiDomenico of Everett and Rep. Dan Donohue of Worcester have sponsored bills to battle wage theft and lent their support to ensuring the hardworking people of Massachusetts get paid the money they earn. Both of these bills have more than half of the Legislature signed on as co-sponsors.

Seven decades after the Brink’s robbery, people still recall not only the crime but the response to it to make sure it doesn’t happen again. That’s what we should be doing on the wage theft front, as well.

Frank Callahan is the president of the Massachusetts. Building Trades Council.

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New poll of Maine workers shows strong support for more workforce protections (ME)

Dan Neuman
December 23, 2019

A new survey of workers in Maine shows that there is significant desire for the state to take a major role in adopting policies that improve job quality and advance economic justice.

The survey, which polled private sector workers in Maine, was released last week by the Maine Center for Economic Policy (MECEP) as a part of the organization’s annual “State of Working Maine,” a comprehensive analysis of the economic and workforce trends in the state.

Workers were asked about several workforce policies introduced earlier this year that will likely see a vote sometime next year after state lawmakers return to Augusta in January.

Policies that have seen inaction on the federal level, such as paid family and medical leave, expanded overtime protections, and prohibitions against wage theft and unfair scheduling practices, have strong support among Maine workers. MECEP’s report concludes that this popular support presents an opportunity in the state legislature – where Democrats hold majorities in the Maine House and Senate, as well as control the governor’s office – to make gains after years of conservative control. …

Eighty-six percent want increased penalties for employers who steal wages
MECEP’s survey also shows a substantial amount of support for combating wage theft and mandating predictable work schedules. Eighty-six percent of the respondents want to require employers to pay wages in a timely manner and increase penalties and enforcement for employers who commit wage theft. ….

Senate President Troy Jackson (D-Allagash) has a bill being vetted by lawmakers that would make it easier for the state Attorney General’s office to swiftly clamp down on businesses that may be engaging in wage theft. Another bill that would have mandated that businesses guarantee a fair workweek to their employees was killed in committee after the sponsor, state Rep. Gina Melaragno (D-Auburn), said she needed more time for consultation. That reworked bill has not been submitted for the upcoming legislative session.

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Hennepin County Attorney announces charges of insurance fraud and theft by swindle against former owners of Merit Drywall (MN)

January 21, 2020

Today, the Hennepin County Attorney announced charges of insurance fraud and theft by swindle against the former owners of Merit Drywall. According to the criminal complaint, the two defendants, Leroy and Joyce Mehr, misclassified workers as independent contractors to avoid paying more than $300,000 in workers compensation insurance premiums.

“Wage theft, insurance fraud and worker classification fraud have no place in Minnesota. It is critical that the legal system hold those who are accused of these crimes against construction workers accountable,” said Jessica Looman, Executive Director of the Minnesota Building and Construction Trades Council, an advocate for Minnesota’s union construction industry. “We want to thank the Hennepin County Attorneys office, the Minnesota Department of Commerce Fraud Bureau, and the Building Trades Unions in our state for protecting workers and our industry.”

“The case against the former owners of Merit Drywall shows the strength of the construction community when we stand together and demand action when workers complain of wage theft and worker misclassification,” said Dan McConnell, Business Manager of the Minneapolis Building and Construction Trades Council. “Our members have lost their patience with those developers and general contractors who have profited from schemes like the one alleged here. Together, the Building Trades Unions will do everything we can to continue to assist in ensuring that those who are complicit in the exploitation of workers are held accountable.”

Minnesota’s Building Trades Unions have launched an initiative to combat wage theft, exploitation, and labor trafficking which poses a growing threat to the welfare of immigrant workers and the health of the state’s construction industry. The “Not On My Watch” or “Ya No Mas” campaign enlists union members in efforts to identify cases of abuse, and to assist exploited construction workers on Minnesota jobsites.

The Minnesota and Minneapolis Building and Construction Trades Councils will continue to support efforts to protect all Minnesota construction workers. #notonmywatch.

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Amherst councilors propose bylaws to enforce wage, labor laws (NH)

By SCOTT MERZBACH
Published: 2/25/2020

AMHERST – The Town Council is considering a package of bylaws that would give Amherst officials some oversight in making sure workers are getting minimum wage and that other labor laws are being followed, such as workers being paid appropriately for overtime work and receiving tips.

Collectively known as wage theft bylaws, the proposal is being brought forward by District 1 Councilor Cathy Schoen, District 2 Councilor Pat DeAngelis and At Large Councilor Mandi Jo Hanneke, and would bring Amherst in line with Northampton, Easthampton, Springfield, Cambridge, and other communities that have adopted similar bylaws and ordinances.

The first, known as the responsible employer bylaw, would mandate that the town award contracts only to companies following the laws, Hanneke said. It would require any contractor to certify, in writing, that they are in compliance with wage, hour and benefits laws, and have not had violations for the past five years.

The second, the tax incentive or tax relief bylaw, would mean such agreements, under the purview of the Town Council, can be granted only to businesses that follow the bylaw. The bylaw would also have provisions for rescinding or reducing tax incentives.

The third, the wage and tip bylaw, applies to the service industry and offers the potential for fines or possible license loss if workers are not paid appropriately. The bylaw would also create a Wage Theft Advisory Committee that includes members of the Licensing Commission, Human Rights Commission, Amherst Area Chamber of Commerce and Pioneer Valley Workers Center. In addition, the bylaw would require the posting of rights in all establishments and information on how to report a violation or file a complaint.

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New Jersey DOL cites, fines Katerra sub for wage violations (NJ)

AUTHOR: Kim Slowey
PUBLISHED: Feb. 18, 2020

Dive Brief:

  • The New Jersey Department of Labor & Workforce Development (NJDOL) has issued a stop-work order to subcontractor REB Construction and Maintenance LLC for failure to take the proper deductions from its employees’ pay and for not keeping the required payroll records related to work performed on a project in Jersey City, New Jersey. The department also fined REB $19,250. …
  • The authority that the NJDOL has to stop work on a construction project when significant pay, benefits or other workers’ rights violations are documented is part of new legislation based on the July 2019 recommendations of New Jersey Gov. Phil Murphy’s task force on employee missclassification.

Dive Insight:

Stop-work orders (A5838): The NJDOL can force an employer to stop work if it determines that the employer violated state wage, benefit or tax laws.

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