Local Company Pockets Worker’s Wages, Tax Dollars, Whistleblowers say

Posted by National Alliance for Fair Contracting on

Monday, October 27, 2014
Cornelius Swart, GoLocal PDX Director of Content

 

A local janitorial company that has worked on publicly-funded projects has been shortchanging its workers and pocketing their wages, according to the claims of whistleblowers.

Wage theft complaints against Cornerstone Janitorial Service of Hillsboro have been filed in Oregon and Washington and whistleblowers allege that the company hires undocumented immigrants and takes taxpayer-funded wages that rightfully belong to workers.

In response, Cornerstone tells GoLocalPDX it only hires legal residents and pays the proper wages.

But an investigation by GoLocalPDX has found that in some cases workers are only paid $12 an hour on jobs that should have been compensated at an hourly rate of $36.

(Read More)

California cracks down on wage theft by employers

Posted by National Alliance for Fair Contracting on

OCTOBER 23, 2014, 5:11 PM

State regulators are wielding a new tool to combat the intractable problem of employer wage theft, which costs workers an estimated $390 million a year.

The California controller, working with the state labor commissioner, is demanding restitution from suspected violators – and filing lawsuits, if necessary – under California’s Unclaimed Property Law.

“We’re using a 55-year-old statute to compel immediate payment from unscrupulous businesses that have fleeced their employees of earned wages for years,” state Controller John Chiang said at a news conference in Fresno on Thursday.

Chiang has ordered a pair of firms, identified in a pilot project, to transfer any wages that have gone unpaid for more than a year to the state treasury. Then, the controller’s office can look for the recipients and pay them their overdue money.

(Read More)

 

US Labor Department lawsuit alleges Wisconsin landscape service retaliated against 2 employees who filed complaint seeking overtime pay

Posted by National Alliance for Fair Contracting on

U.S. Department of Labor   October 23, 2014
Wage and Hour Division

ARPIN, Wis. — The U.S. Department of Labor has sued Carl’s Landscape Service Inc. in Arpin, alleging that the company retaliated against two workers for contacting the department’s Wage and Hour Division with a complaint about unpaid overtime.

“The law prohibits employers from retaliating against any employee who files a complaint or cooperates in a Wage and Hour investigation,” said Theresa Walls, district director for the Wage and Hour Division in Minneapolis. “The Wage and Hour Division will not tolerate willful employee intimidation or coercion and will make use of every tool we have available to ensure that a fair investigation is conducted and workers are protected.”

After the company learned of the worker’s contact with the Wage and Hour Division, one employee was fired and the second was not called back following a seasonal layoff. A complaint has been filed in the U.S. District Court for the Western District of Wisconsin against the company and its owner, Darrell Kasner, seeking lost wages for the two employees and an injunction against future retaliation.

(Read More)

US Labor Department secures nearly $2M in back wages, benefits for nearly 150 workers at federally-funded solar energy project in Nevada

Posted by National Alliance for Fair Contracting on

WHD News Release: [10/23/2014] 

LAS VEGAS – The U.S. Department of Labor has recovered $1,914,681.50 in back wages and fringe benefits for 147 workers at Proimtu Mmi-Nv LLC, a Henderson-based subcontractor providing construction services at the federally funded Crescent Dunes Solar Energy Project in Tonopah. This project, which received a $737 million loan guarantee from the U.S. Department of Energy, is a 110 MW solar energy power plant that will power up to 75,000 homes during peak electricity periods.

“The money we’ve recovered for these workers is not a windfall – it is their hard-earned pay that their employer was legally obligated to pay them but did not,” said Dr. David Weil, administrator of the department’s Wage and Hour Division. “Companies that benefit from federal funding must see to it that the money is used properly, and that their workers are compensated according to the law.”

An investigation found that Proimtu Mmi-Nv violated the prevailing wage and fringe benefits requirements of the Davis-Bacon and Related Acts for the majority of their employees working at the Tonopah desert solar energy project. The Crescent Dunes Solar Energy Project is subject to specific requirements under the DBRA since its funding includes hundreds of millions of dollars in federal loan guarantees from the U.S. Department of Energy under the American Recovery and Reinvestment Act of 2009.

(Read More)

 

Report: Seattle Needs Community Groups To Help Enforce New $15 Minimum Wage

Posted by National Alliance for Fair Contracting on

For Immediate Release: October 22, 2014

Seattle, WA – Seattle made history by becoming first city in the nation to adopt a $15 minimum wage, but it will need to strengthen its labor standards enforcement to ensure that workers get the raise due to them-and community groups should play a key role in that effort, according to a new report from the National Employment Law Project.

“We don’t have a $15 minimum wage if we don’t enforce a $15 minimum wage,” said Rebecca Smith, deputy director of the National Employment Law Project and the report’s co-author. “Educating the employer community is one key to compliance, but education isn’t enough. A robust wage enforcement system needs strong partnerships with local community organizations-groups that are trusted by workers who might not be willing to file complaints directly with the city.”

(Read Full Press Release Here)

(PDF of Report)

City may refuse licenses to companies convicted of wage theft

Posted by National Alliance for Fair Contracting on

Maria Garcia

POSTED: 06:28 PM MDT Oct 20, 2014 
UPDATED: 06:37 PM MDT Oct 20, 2014

EL PASO, Texas – The City of El Paso is preparing an ordinance meant to deter companies from stealing wages from workers. The City Council on Monday unanimously voted to direct the City Manager to draft a wage theft ordinance that would mirror the City of Houston’s law.

Houston’s ordinance forbids any person or company from obtaining or renewing any City license or permit for five years if the company has been convicted of wage theft and exhuasted all appeals. Barring persons from city licenses essentially bans them from working within the City. The ordinance also bars the city from hiring people or firms criminally convicted or assessed civil penalties or judgments related to wage theft, again provided appeals are exhausted and a civil judgment in favor of the worker goes unpaid.

The Paso Del Norte Civil Rights Project, in 2011, did a study of how many workers have been victims of wage theft and say the problem is rampant. For example, they say as many as 67-percent of low wage workers aren’t paid the overtime they’re owed.

US Labor Secretary Thomas E. Perez announces final rule raising the minimum wage for federal contract workers

Posted by National Alliance for Fair Contracting on

Rule raises the minimum wage to $10.10 per hour for covered workers

WASHINGTON — Upholding President Obama’s promise to make 2014 a year of action to expand opportunity, reward work and grow the middle class, U.S. Secretary of Labor Thomas E. Perez today announced a final rule that raises the minimum wage for workers on federal service and construction contracts to $10.10 per hour. The final rule implements Executive Order 13658, which was announced by the president on Feb. 12, and it will benefit nearly 200,000 American workers.

“No one who works full time in America should have to raise their family in poverty, and if you serve meals to our troops for a living, then you shouldn’t have to go on food stamps in order to serve a meal to your family at home,” said Secretary Perez. “By raising the minimum wage for workers on federal contracts, we’re rewarding a hard day’s work with fair pay. This action will also benefit taxpayers. Boosting wages lowers turnover and increases morale, and will lead to higher productivity.”

The final rule provides guidance and sets standards for employers concerning what contracts are covered and which of their workers are covered. The rule also establishes obligations that contractors must fulfill to comply with the minimum wage provisions of the executive order, including record-keeping requirements. It provides guidance about where to find the required rate of pay for all workers, including tipped employees and workers with disabilities. Additionally, the rule establishes an enforcement process that should be familiar to most government contractors and will protect the right of workers to receive the new $10.10 minimum wage.

(Read More)

(Minimum Wage Executive Order Final Rule)

(PDF of Final Rule)

(PDF of Executive Order 13658)

(Secretary Perez Blog – A Promise Made and a Promise Kept)

L&I settles $200,000 claim against Whatcom County Jail contractor

Posted by National Alliance for Fair Contracting on

October 2, 2014

Bellingham – A contractor renovating the Whatcom County Jail has paid nearly $200,000 in back wages owed to 13 workers on the project.

Sierra Detention Systems, of Brighton, Colo., paid the money following a Washington State Department of Labor & Industries investigation, which was spurred by a January worker complaint. The company paid lower apprenticeship wages to electricians.

“We don’t know whether the company’s intent was to avoid paying the higher journeyman wage,” said Jim Christensen, Prevailing Wage Program manager for the agency, who noted this was a first-time offense for the firm. “In this case, the employees were doing the work of electricians and were not part of any state-registered apprenticeship program.”

(Read More)

At an upscale Pearl District apartment project, a union blows the whistle on wage theft

Posted by National Alliance for Fair Contracting on

By DON McINTOSH, Associate Editor

The U.S. Labor Department is investigating prevailing wage violations at four Portland-area construction projects that received loan guarantees from the U.S. Department of Housing and Urban Development (HUD). That government help came with conditions: The apartments must be affordable for moderate-income families or the elderly or handicapped, and construction workers must be paid local prevailing wage rates as determined by government surveys.

But an investigation by Painters District Council 5 found that a painting subcontractor at the Parker Apartments construction project paid workers as little as half the amount they were entitled to. Workers who complained about the violation were let go.

Undercover probe
The story begins in March, when Painters union organizer Roman Ramos asked out-of-work union member Marcos Jimenez to go undercover as a painter at the Parker Apartments – a six-story 177-unit apartment building under construction in the Pearl District – and report back any illegal practices he found.

The Parker is named after the toddler son of Bob Ball, a prominent developer who ran for Portland mayor in 2008. To build it, Ball teamed up with Eugene developers Don Woolley and Tom Connor, and with a HUD loan guarantee, they obtained a $35.7 million loan from CBRE, the world’s largest commercial real estate services firm.

Painters District Council 5 has been investigating HUD-sponsored construction projects in the Pacific Northwest, starting in Seattle, says organizing director Jeff Kelley. The goal is to clean up the industry, making it harder for companies to win contracts by cheating workers out of wages.

“Every project we’ve looked at in Washington and Oregon has had issues,” Kelley said. And the biggest issue has been violations of the prevailing wage law, known as Davis-Bacon.

(Read More)

New Misclassification Study Shows Impact in California

Posted by National Alliance for Fair Contracting on

By Jim Kollaer on Wed, 10/15/2014 – 10:30am 

In a September 2014 study entitled Sinking Underground: The Growing Informal Economy in California Construction, misclassification of more than 39,800 construction workers is a key reason that the underground economy in construction is contributing to the low wages, difficulty in recruiting qualified craft workers and loss of wages and taxes in the State of California.

According to the study, released by the Economic Roundtable, a non profit research organization based in Los Angeles, in 2011 more than 143,900 construction jobs in the state were “informal” – code for off the books, misclassified as independent contractors or unreported by employers.

The study looked at wages and construction jobs from 1972 to 2012 and found that the number of construction workers that were unreported or misclassified increased by 400% during that period.

The study cites that, “Specialty trades, such as drywall, have the highest level of informality with over 25% employed informally in 2012.  Building Construction was next, with 20% estimated to be informal.”

The major impact on the industry is that those construction companies in California who are “doing it right” have costs that are 30% higher that the “off the books and misclass” contractors.  Imagine what that disparity does to the bidding process.  The report cites several personal stories to illustrate its points.

(Read More)

(link to Economic Roundtable)

(link to pdf of Economic Roundtable study)