Report: Construction Contractors Cheating Workers, Taxpayers (PA)

Posted by National Alliance for Fair Contracting on

By John Nichols
JANUARY 7, 2019

January 14, 2019

HARRISBURG, Pa. – Unscrupulous contractors in southeast Pennsylvania routinely are violating labor laws and victimizing customers, including state and local government, according to a new report.

The report from the Keystone Research Center found many contractors in the regional Philadelphia construction industry are in a race to the bottom.

Stephen Herzenberg, author of the report, calls that “destructive competition” – cutting costs by misclassifying workers as independent contractors, cheating them out of overtime pay, investing little in worker skills and in some cases operating unsafely.

“When construction contractors and subcontractors compete by violating the law, wage theft, threatening workers’ health and safety, in the end nobody else wins,” he states.

The report says imposing stiffer penalties for labor law violations and directing more resources to enforcement agencies would help safeguard workers, law abiding contractors and taxpayers.

Herzenburg points out that effective enforcement can pay for itself by directing revenue from fines and penalties to enforcement agencies, and it can change the current landscape of the construction industry.

(Visit the Keystone Research Center Website)

(View PDF copy of Study – Illegal Labor Practices in the Philadelphia Regional Construction Industry: An Assessment and Action Plan)

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AG: Leominster construction firm ordered to pay nearly $840,000 for violating labor laws (MA)

Posted by National Alliance for Fair Contracting on

By Peter Jasinski
UPDATED: 10/31/2018 02:40:51 PM EDT

BOSTON — A Leominster construction company has been ordered to pay $837,341 in restitution and penalties for making illegal deductions from worker paychecks following the second investigation in less than three years of allegations the company was violating labor laws.

Massachusetts Attorney General Maura Healey announced Wednesday that Force Corporation and its managers, Juliano Fernandes, Anderson Dos Santos, and Claudio Cicero Da Silva have been issued two civil citations for failing to make timely payment of wages and failure to furnish payroll records to the AG’s office.

“Force Corporation and its managers cheated their construction workers out of hundreds of thousands of dollars,” said Healey in a written statement. “To build this case, our team documented the use of dozens of illegal tricks used by employers to steal from workers.”

This most recent investigation began after state officials received several complaints from the New England Regional Council of Carpenters.

The AG’s investigation revealed that Force Corporation has been regularly taking illegal deductions from employees weekly wages to pay for tools, safety equipment, and advances in what Healey referred to as a “textbook example of wage theft.”

The investigation also showed that Force unlawfully required employees to purchase their own tools through a company owned by Fernandes, one of Force’s managers.

…

The company was found in willful violation of federal labor laws and ordered to pay nearly $2.4 million back wages and damages to 478 employees in 2016 and $262,000 in fines for violating the federal Fair Labor Standards Act.
According to an investigation by the Wage and Hour Division of the U.S. Department of Labor, Force Corporation created a separate company, AB Construction Group of Framingham, as a way to provide Force with employers but classify them as independent contractors. This misclassification led to the company failing to pay employees overtime and keep accurate time and payroll records.

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New laws toughen up penalties for labor law violations

Posted by National Alliance for Fair Contracting on

Published Thursday, July 7th 2016

HONOLULU (HawaiiNewsNow) –
Hawaii employers who fail to comply with state labor laws will face stricter penalties, under new measures signed into law July 1.

Gov. David Ige signed the laws, increasing the penalties violations of requirements for workers’ compensation insurance, temporary disability insurance and for breaking prevailing wage laws on public construction projects.

In Nov. 2015, an investigation by the Labor Department found dozens of contractors and subcontractors working at the Ala Moana Center’s new Ewa wing violated labor laws by not necessary taxes.

Furthermore, the department found a number of construction firms also failed to pay pre-paid health insurance and temporary disability insurance for their workers.

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