3d_money_construction_dreamstime_xxl_21903206

US Labor Department investigations result in more than $415,000 in back wages for workers on Detroit Palmer Park Square HUD project

Posted by National Alliance for Fair Contracting on

DETROIT — U.S. Department of Labor investigations have resulted in over $415,000 in back wages for more than 90 employees performing construction work on the federally funded Palmer Park Square affordable housing in Detroit. The investigations, conducted by the department’s Wage and Hour Division, were part of a multiyear strategic enforcement initiative aimed at combating widespread labor violations on federally funded construction projects in the Detroit area, such as affordable housing construction projects funded by the U.S. Department of Housing and Urban Development.

The investigations found that Malino Construction and several project subcontractors violated provisions of the Davis-Bacon and Related Acts, the Contract Work Hours and Safety Standards Act and the Fair Labor Standards Act. The companies failed to pay prevailing wages, fringe benefits and overtime to construction workers on the project, failed to keep accurate time and payroll records for employees, and provided falsified, certified payroll records to the government.

Due to the extent and willful nature of the violations, Detroit-based Malino Construction, the prime contractor on the project, has been debarred from bidding on federal contracts for up to three years

(Read More)

Comptroller Scott M. Stringer Settles Prevailing Wage Dispute For More Than $435,000

Posted by National Alliance for Fair Contracting on

New York, NY – New York City Comptroller Scott M. Stringer announced an agreement this week between National Insulation & GC, Corp. and the Office of the New York City Comptroller, Bureau of Labor Law, in which the company admitted to willfully and knowingly failing to pay two employees a prevailing wage for contracted work with the Department of Education (DOE). National Insulation will pay a fine of $435,666.72, including more than $39,000 in civil penalties to the City, as a result of the settlement.

“We have found that all too often, employees are fleeced out of money to which they’re entitled by unscrupulous contractors looking to cut corners,” Stringer said. “These employees worked hard for their salaries and they deserve to get every cent that’s rightfully owed to them.  My office will continue to pursue these bad actors that fail to provide a legal wage.”

The two employees, Francisco Ayala and Angel Ribadeneira, were hired by National Insulation to perform insulation work at New York City public schools between December 2006 and November 2010. An investigation by the Comptroller’s office into National Insulation, prompted by a DOE referral and evidence provided, revealed allegations of under reporting hours, misclassification of workers, and use of “ghost workers” on sites.

(Read More)

More than $1.6M in Unpaid Overtime for 1,543 Workers in the Gulf Coast Recovered by US Labor Department

Posted by National Alliance for Fair Contracting on

HOUMA, La. – B & D Contracting Inc., a labor recruiting and staffing agency that caters to oil field services and maritime fabrication facilities along the Gulf Coast, has agreed to pay $1,660,438 in back wages to 1,543 current and former employees. An investigation by the U.S. Department of Labor found that the company engaged in improper pay and record-keeping practices that resulted in employees being denied overtime compensation in violation of the Fair Labor Standards Act. The employees were assigned to client work sites throughout Louisiana, Mississippi and Alabama to work as welders, pipe fitters and shipfitters.

Investigators from the Wage and Hour Division’s New Orleans District Office found the company mischaracterized certain wages as per diem payments and impermissibly excluded these wages when calculating overtime premiums, denying employees earned overtime compensation.

“Temporary staffing agencies serve valuable and legitimate business needs in today’s economy,” said Dr. David Weil, administrator for the Wage and Hour Division, “But employers may not manipulate these arrangements and use evasive pay practices to avoid paying workers their rightful wages.”

“The labor violations we found in this case are not unique to B & D Contracting Inc.,” said Cynthia Watson, regional administrator for the division in the Southwest. “We are increasingly finding the use of per diem schemes as a means of decreasing overtime pay and tax obligations in the staffing and support services industry in this region. The resolution of this case demonstrates our continued focus on combating such labor violations in order to improve compliance in this industry.”

(Read More)

Fedex Settles Million-Dollar Misclassification Case, a Dozen Similar Suits Pending Nationwide

Posted by National Alliance for Fair Contracting on

In a settlement of a federal court lawsuit in Maine, FedEx Ground has agreed to pay $5.8 million in back pay and legal fees to 141 drivers it misclassified as independent contractors.  The lawsuit claimed that FedEx denied overtime pay and made improper deductions in addition to requiring drivers to pay for their expenses.  While there were seven named plaintiffs in the case, only two signed the settlement.  The others felt the amount being paid out by FedEx was too low.

 The federal court judge noted that if the case had gone to trial, damages could have topped $10 million. Nonetheless, the court found the settlement fair and adequate:

 In approving the settlement last week, the court acknowledged that “the proposed settlement…is clearly a compromise that discounts to some degree…the drivers’ total claims” but is a “fair trade-off for the uncertainties of trial and appeal and a prolonged delay in receiving any money. In that regard, the court noted that FedEx Ground has won some independent contractor misclassification cases and lost others.

The court also found that the amount (one-third of the $5.8 million settlement) sought by the lawyers for the class for counsels’ legal fees, costs, and expenses was reasonable.

(Read More)

Appalachian Oilfield Services Agrees to Pay $129,802 in Overtime Back Wages to 29 Workers at Ohio Oil Fracking Sites

Posted by National Alliance for Fair Contracting on

COLUMBUS, Ohio — Appalachian Oilfield Services LLC has agreed to pay 25 heavy equipment operators $129,802 in overtime back wages after an investigation by the U.S.

Department of Labor’s Wage and Hour Division found the company was in violation of the Fair Labor Standards Act. At eastern Ohio drilling locations, the workers provided cleanup services and hauled away muck ejected from wells in the oil fracking process.

“Companies that underpay their employees also undercut employers who obey the law and pay their workers lawfully required wages,” said George Victory, the Wage and Hour Division’s director in Columbus. “Failing to compensate employees properly for all hours worked is unacceptable. The Wage and Hour Division is committed to ensuring workers receive the pay they have rightfully earned.”

An investigation conducted by the division’s Columbus District Office found that equipment operators were paid a flat daily rate for a 12-hour shift. When they worked in excess of 12 hours, they were paid an hourly rate. No overtime compensation was provided for hours worked in excess of 40 hours, in violation of the FLSA.

(Read More)

Nearly $5M in Back Wages for Approximately 500 Workers at Federally-Assisted Project in New York Secured by US Labor Department

Posted by National Alliance for Fair Contracting on

NEW YORK – MDG Design & Construction LLC has reached a settlement with the U.S. Department of Labor that resolves wage violations at the federally-assisted Grand Street Guild construction project in New York City’s Lower East Side. MDG and other respondents will pay $3.8 million in back wages and fringe benefits to about 200 of MDG’s subcontractors’ construction workers. Previous, separate investigations led to the repayment of more than $1.1 million in back wages to approximately 300 laborers and mechanics who worked for MDG’s subcontractors on the Lower East Side project.

MDG was the general contractor for the Grand Street Guild project, which involved the refurbishment and rehabilitation of three 26-story apartment towers. The department’s Wage and Hour Division found numerous Davis-Bacon and Related Acts violations by MDG subcontractors on the project, including failure to pay required prevailing wages and submitting inaccurate or falsified payroll records to the government.

(Read More)

Arizona Utility Subcontractor Debarred From Federally Funded Projects

Posted by National Alliance for Fair Contracting on

PHOENIX — The U.S. Department of Labor has recovered $198,085 in back wages for 23 workers employed by Glendale-based Tierra Contracting Inc. for willful violations of the Davis-Bacon and Related Acts and the Contract Work Hours and Safety Standards Act. Tierra Contracting and its owner, Richard Juarez Sr., also have been debarred from applying for federally funded contracts for a period of three years because of the egregious nature of the violations found.

Investigators with the department’s Wage and Hour Division in Phoenix established that Tierra Contracting failed to pay the required prevailing wage rates and fringe benefits to power equipment operators, water truck drivers, pipe layers, grade setters and laborers working at the federally funded Northern Parkway highway project in Maricopa County. Tierra Contracting routinely submitted certified payroll records that did not accurately reflect the real hours worked by the affected employees. Employees were paid for overtime hours with separate checks, off-the-record and at straight-time rates, without the additional time-and-a-half, as required.

(Read More)

Contractor Will Pay Thousands in Back Wages for Auburn Activities Center

Posted by National Alliance for Fair Contracting on

Eleven workers underpaid for their effort on an Auburn activity center will share nearly $43,000 in wages owed to them under a settlement between the state and the construction company involved.

The Washington State Department of Labor & Industries (L&I), Attorney General’s Office and RJL Construction LLC reached the agreement on May 8, prior to an administrative hearing. As part of the settlement, RJL is barred from working on future public works projects.

The Kent-based construction firm employed carpenters, iron workers, cement masons and power equipment operators who were wrongly paid at the rate of general laborers. It was concluded that the workers weren’t paid for overtime or the correct “prevailing wage,” the amount under state law the contractor is required to pay for specific work on a public project.

(Read More)

3d_money_construction_dreamstime_xxl_21903206

Paul Johnson Drywall Inc. Agrees to Pay $600,000 in Back Wages, Damages and Penalties Following US Labor Department Investigation

Posted by National Alliance for Fair Contracting on
PHOENIX – As a result of a Wage and Hour investigation, Paul Johnson Drywall Inc. severed its relationship with Arizona Tract LLC., a construction labor contractor. Beginning April 2013, Paul Johnson Drywall entered into a contract with Arizona Tract for the provision of drywall labor. Arizona Tract classified former Paul Johnson Drywall workers as “member/owners” instead of employees, which stripped them of basic worker protections afforded to employees.

Today, the U.S. Department of Labor filed a consent judgment in the U.S. District Court for the District of Arizona by which Prescott-based Paul Johnson Drywall Inc., and its owner Robert Cole Johnson, agreed to take concrete steps to ensure that misclassification of its workforce does not occur again and to pay $556,000 in overtime back wages and liquidated damages to at least 445 current and former employees. The employer also agreed to pay $44,000 in civil monetary penalties.

(Read More)

HUD Tells Canton to Make Up Prevailing Wage Difference

Posted by National Alliance for Fair Contracting on
If you’re a construction worker who helped build Goodwill’s Canton campus in 2009, you may be getting a small check from the city.
The U.S. Department of Housing and Urban Development is forcing the city of Canton to pay $31,000 in wages to some workers who built Goodwill’s campus at 408 Ninth St. SW.
HUD, in an audit of the city’s federal spending of Community Development Block Grant funds, found that the city never enforced a requirement that construction workers be paid the prevailing wage. The prevailing wage is the hourly wage, plus overtime and benefits, paid to a majority of workers in a particular area. It is set by the U.S. Department of Labor.