“Lifting Up Illinois Working Families Act” Increases Minimum Wage to $15 Per Hour (And Penalties for Non-Compliance) (IL)

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By Carole Carlson
February 18, 2019

Illinois Governor J.B. Pritzker signed the Lifting Up Illinois Working Families Act into law on February 19, 2019. The Act gradually increases the minimum wage to $15 per hour over the next six years. Illinois is now the fifth state (after California, New Jersey, New York, and Massachusetts) to raise the minimum wage to $15 per hour. While the Act is receiving a lot of press for the minimum wage increase, it makes other changes to Illinois law about which Illinois employers must also be aware.
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Penalties Increase for Underpayment and Recordkeeping Violations

In addition to the minimum wage increases, the Act increases certain penalties for recordkeeping violations and underpayment of wages. Employers who fail to keep payroll records as required by the IMWL are now subject to a new penalty of $100 per impacted employee. This penalty arguably will accrue each day that the violation continues under the IMWL’s existing provisions.

The Act also increases employers’ exposure in the event of underpayment of wages. An employee who is able to show underpayment of wages is entitled to recover three times the amount of the underpayment. Previously, the law limited recovery to the amount of the underpayment. For each month that the amount of the underpayment remains unpaid, a prevailing employee can recover damages in the amount of 5% of the underpayment. Prior to the Act, employees could recover 2% as damages.

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Payroll tax fraud believed to be spreading throughout Indiana’s construction industry (IN)

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By: Drew Gardner
Posted: Feb 25, 2019 10:34 PM EST


SOUTH BEND, Ind. — The construction industry across Indiana is facing something many contractors call a growing problem — payroll tax fraud.
Some contractors are believed to be misclassifying workers, which robs them of many of the regular benefits employees receive and robs the state and federal government of hundreds of millions in tax dollars.

As you drive through Michiana it’s easy to see things are pretty good in the construction industry right now. There are new developments around almost every corner, but in recent years contractors like Tim Larson of La Porte-based Larson-Danielson construction noticed something seemed ‘off’ in some of the bids they were seeing.

” When we bid for a job we know how much is labor, how much is material and we found other contractors bidding at prices we couldn’t quite perceive how they were getting there, because we knew how much they were spending on material and we figured they had to be spending a lot less on labor than we were,” said Larson.

That’s because some contractors are believed to be participating in worker misclassification.

Worker misclassification is the practice of labeling workers as independent contractors instead of employees.

The IRS has a 20 point checklist to determine whether a worker is an employee or an independent contractor.

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Lawmakers debate bill to allow Idahoans to get unpaid, underpaid wages back (ID)

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by KLEW News Staff
Tuesday, February 26th 2019

BOISE, ID – A bill allowing working Idahoans to recoup up to one year of under-paid wages is trying to become law.

Currently, Idaho only allows workers to get six-months of unpaid or underpaid wages through a process with the State Department of Labor.
It is one of the lowest look-back periods in the nation. Supporters of working Idahoans say it’s about fairness.

The Department of Labor said that most workers notice wage theft in one of two time periods; either the Monday after payday or when they do their taxes.

The bill being debated Monday maintains protections for Idaho employers while injecting fairness into the system.

“What this does is level the playing field and makes sure that someone who’s legitimately had wages stolen from them, can claim those wages up to a full year when they realize that their wages were taken from them, when they go to do their taxes,” said Rep. Mat Erpelding.

The Idaho Department of Labor processed more than 900 wage theft claims last year from workers representing virtually every line of work including construction, service workers, healthcare employees and retail workers.

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Local building unions, immigrant labor advocates unite over worker misclassification (LA)

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By: Michael Joe, Reporter

February 8, 2019

On a recent Saturday in January at Corpus Christi Church in the 7th Ward, Curiel stood in the afterglow. A workers’ forum aimed at “bringing immigrants out of the shadows” had just concluded. And it was jointly organized by the Southeastern Louisiana Building and Construction Trades Council and three community organizations focused on workers’ rights and economic justice – Step Up Louisiana, the Workplace Justice Project and the New Orleans Workers’ Center for Racial Justice, a grassroots group founded after the storm by immigrants and African Americans.

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Organizers said the goal on Jan. 26 was to educate immigrant workers about their rights and highlight what they say is a common problem that hurts unions and immigrant workers alike: the misclassification of workers as independent contractors – rather than employees – by construction contractors and subcontractors.

When you call an employee an independent contractor – when they are actually an employee – that allows you to not pay workers’ compensation, not pay social security and not pay time and a half for overtime. Not only is the worker being exploited, it’s creating an unfair playing field for the contractors that are actually doing the right thing,” said Chip Fleetwood, marketing manager with the Painters and Allied Trades International Union, District Council 80, in Kenner.

Union contractors are even more disadvantaged when bidding on jobs, because they are also paying for the health and welfare benefits of unionized workers, Fleetwood added.

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Subcontractor Ordered To Pay Back $160k In Stolen Wages (MA)

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The subcontractor for Worcester’s new luxury apartments at 145 Front Street will have to pay almost $160k to 50 employees.

By Samantha Mercado, Patch Staff 

Jan 30, 2019 4:47 pm ET

WORCESTER, MA- A subcontractor has to pay $158,000 in back pay to 50 employees on the 145 Front Street development in Worcester after a determination announced by the U.S. Department of Labor Wednesday.
The subcontractor is P&B Partitions, a New Jersey company hired by the general contractor, Erland Construction, for the luxury apartment building owned by Mack-Cali. The company was found to have skimped on overtime pay, giving employees straight time in cash.

An investigation into the wage theft began in April 2017 when the Worcester Carpenter’s Union filed a complaint. What started as five carpenters, grew to a group of 12 signed complaints, the union said, adding that all of the wage theft victims were people of color, primarily Latino.
David Minasian, Business Manager for Carpenters Local 336, called the determination a loud warning bell for city and state leaders. “The wage theft business model perpetuates itself because it is profitable. We were concerned when Erland was selected to build the project, and worried when we heard they were going to hire P&B Partitions with a history of avoiding wage and hour laws,” Minasian said.

The union held weekly rallies for months to support the workers and raise awareness about wage theft. In April, 2018, the National Labor Relations Board awarded one of the carpenters that stepped forward $15,000 in back wages, after the union said he was unlawfully terminated for trying to improve the working conditions and beginning efforts to organize the carpenters.

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Massachusetts AG’s Office Aims To Clamp Down On Wage Theft (MA)

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By Arun Rath

February 26, 2019

Massachusetts’ ongoing construction boom has brought with it a problem: wage theft – when workers don’t get things like overtime or sick pay, or when they’re not paid at all – on a massive scale.

Last year, Attorney General Maura Healey’s office brought more than $2.7 million in penalties and restitution against local construction companies. Some of that money is going to the more than 1,000 Massachusetts workers who were victims of wage theft last year.

Javier Hernandez was one of them. He spent six months working construction on a new hotel in Porter Square. But he said that every time it was pay day, “They always say, ‘Next week. Next week. Next week.'”
It was the same story when the holidays came.

“I spent Christmas with no money,” Hernandez said. “I have a kid. 10 years old. So, I couldn’t buy a present for him. Because I’m still waiting for the money. And, and that’s so sad.”

Hernandez’ story is a familiar one to Gladys Vega of the Chelsea Collaborative – a Latino-led social services organization that assists a lot of immigrants and refugees. Vega said immigrants are often targets of unscrupulous employers.

“We probably get 10 to 15 people a week with individual cases of not getting paid, of wage theft,” Vega said. “So, I mean, it’s huge.”

In Hernandez’ case, the collaborative was able to work with partners like the local Carpenter’s Union to get the company to pay up. But when the companies don’t cooperate, it’s the job of law enforcement. And Healey has had a busy year busting wage thieves.”We went after a local construction company that wasn’t paying its workers overtime or hourly wages or the prevailing wage that they were supposed to be paying them doing public construction projects,” Healey said. “We cited them over half a million dollars.”

The AG’s office issued citations to 66 construction companies working in the state last year. Those companies face a combined $1.23 million in fines, in addition to providing back pay to more than 1,000 workers.

Healey said many of the investigations are prompted by tips from workers. But a lot of workers are immigrants or undocumented and are afraid to complain.

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In Major Wage Theft Case, Ipswich Construction Company Cited $580,000 for Violating State Wage Laws (MA)

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Office of Attorney General Maura Healey – 2/28/2019

BOSTON – An Ipswich construction company and its owners have been cited $580,611 in restitution and penalties for violations of state wage and hour laws, Attorney General Maura Healey announced today.

The AG’s Office has issued six citations against ERA Equipment LLC and its owners, Kristen and Angelo Ciardiello, for a range of wage theft violations including failing to pay overtime and the prevailing wage. 

“Our investigation showed that this construction company stole hundreds of thousands of dollars from its workers,” said AG Healey. “Wage theft is a serious offense in Massachusetts and we will continue to take action when needed.”

The AG’s Office began its investigation in September 2017 after receiving a report alleging the company was not paying the proper prevailing wage. The investigation revealed that none of the company’s 13 employees received overtime pay when working more than forty hours in a week. Four employees were also not paid the appropriate prevailing wage rate while working on projects in the towns of Littleton, Scituate, and Wellesley, sometimes receiving less than half the prevailing wage rate required by law.

The investigation also revealed that the company failed to include some employees in the company’s payroll records, inaccurately reported the employees’ hours of work to avoid paying them overtime and kept inadequate and inconsistent payroll records.

The AG’s Office previously brought enforcement action against ERA and the Ciardiellos for nonpayment of wages, prevailing wage, and payroll records violations, including issuing citations that Angelo Ciardiello and his company, ERA Disposal LLC d/b/a ERA Equipment LLC, paid in 2015 for failing to pay five employees for one day of snow removal work.

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Testimony at MN Capitol underscores need for stronger wage theft laws (MN)

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By Howard Kling, Workday Minnesota – February 12, 2019

MINNEAPOLIS/SAINT PAUL – Workers and business owners highlighted the need for stronger wage theft laws during a press conference and legislative hearing at the Minnesota Capitol on February 6. The hearing before the Minnesota House Labor Committee was the first stop for HF6, a bipartisan bill that would set rules and penalties for employers who avoid paying, or fail to pay, wages earned by their employees.

“I am here today to demand an end to this practice of wage theft,” said Humberto Miceli, a member of Centro de Trabajadores Unidos en la Lucha (CTUL). With the help of CTUL, Miceli was able to recover wages stolen by an employer, but in the end he received only 10% of what he was owed. “It is real people who suffer the consequences the way things are right now,” added Miceli.

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Based on complaints filed with the Minnesota Department of Labor and Industry (MNDLI), an estimated 39,000 Minnesota workers are not paid what is owed to them in earned wages each year. In 2015, the last year data was compiled, the Department recovered $1.3 million in back wages for Minnesota workers. MNDLI, as well as labor and community organizations, maintain the scope of the problem is much larger since most workers don’t report wage theft violations, many out of fear of retaliation from their employer.

“There are no repercussions for some of the worst offenses that we see in the construction industry and I am here today hoping legislators support HF6,” said Arturo Hernandez, a journeyman carpenter with Carpenters Local 68. “If I stole money from my boss at work, I would go to prison.”

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House members introduce bill to raise NC’s minimum wage, improve worker rights and incomes (NC)

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By Rob Schofield – February 12, 2019

… State Representatives Pricey Harrison (D-Guilford) and Susan Fisher (D-Buncombe)  introduced some long overdue legislation yesterday to dramatically improve the treatment of workers in North Carolina. House Bill 46- the “Economic Security Act of 2019” – would make the following changes to state law:

  • it would increase the state minimum wage to $15 per hour over five years;
  • it would add North Carolina to the list of states that guarantee pay equity bay barring employers from paying employees of one gender less than employees of another gender for the same work;
  • it would require employers to provide workers with paid sick days and family medical leave (with some exemptions for small employers);
  • it would increase the tipped minimum wage;
  • it would enact new protections against “wage theft” by employers;
  • it would enact new “ban the box” protections to bar employers from inquiring into the criminal history of job applicants on initial application forms;
  • it would repeal the state’s ban on collective bargaining by public employees;
  • it would reinstate the state earned income tax credit and state child care tax credit.

Needless to say, the measure faces an uphill battle in the GOP-led General Assembly, but if there was ever a bill around which North Carolina working families could and should rally in 2019 and beyond, this is it.

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Construction industry, unions duel over state prevailing wage bill (NH)

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NH Senate measure targets all state public works projects

BY BOB SANDERS – Published: February 13, 2019

A measure under consideration in the NH Senate would require contractors on state public works projects to pay the prevailing wage to workers, but it’s not the wages – it’s the benefits and paperwork that concerned several New Hampshire contractors speaking at a hearing Tuesday before the NH Senate Commerce Committee.

Several trade union representatives at the hearing countered that Senate Bill 271 is really not aimed at local contractors, but those outside New Hampshire, drawn here because it is the only New England state without prevailing wage requirements. (Some 24 states don’t have such laws, although the closest one to New Hampshire without one is in Virginia)

“At the end of the day, tax dollars of Granite Staters should go to local workers and local companies,” said Sen. Dan Feltes, D-Concord, the bill’s prime sponsor.

Feltes cited a 2016 study about the benefits of a prevailing wage: At least $300 million in economic activity resulting in some 1,700 jobs and tax revenues of 7.3 percent.

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But union representatives said that the lack of a prevailing wage makes New Hampshire a magnet for out-of-state contractors that do pay both lower wages and benefits, often using undocumented immigrant labor, “and it undercuts our local contractors,” said Denis R. Beaudoin, business manager of IBEW Local 490, the electricians’ union. The construction industry has only replaced 2,000 of the 9,000 jobs it lost during the recession, he said, adding: “How can we justify the work going out of state?”
And while contractors testified that they offer health benefits, they don’t match other union benefits, like an apprentice program, said David Pelletier, business manager of UA Local 131, the plumbers and pipefitters union.

“Unions do provide more benefits than open shops,” acknowledged Abbott. One business did back the prevailing wage bill: American Income Life, a Londonderry insurance firm.

Kris Thieme, an agent from the company, countered contractors’ claim that a prevailing wage would drive up construction costs. He said soft costs, like engineering and architecture, were a bigger factor than labor. Besides, he said, if workers don’t have good benefits or wages, they would be more likely to receive state subsidies for healthcare, which would be passed on to taxpayers.

SB 271 would only apply to state projects, not municipal or school construction jobs, but the NH Municipal Association was concerned that the language wasn’t clear enough on that matter, since many local projects involved state funding.


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