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Nearly $10 million in fines, penalties issued against Massachusetts employers accused of wage theft in 2018 (MA)

Posted by National Alliance for Fair Contracting on

Updated Sep 4; Posted Sep 4
By Kristin LaFratta

In Massachusetts, state officials found $9.6 million in restitution and penalties against businesses and employers who stole wages and exploited workers.

Attorney General Maura Healey released a 2018 Labor Day report this week that explores the findings of wage theft and other means of exploiting workers. Investigations were performed by the AG’s Fair Labor Division, or those who enforce wage laws and the fair bidding of construction projects.

The report revealed wage theft and labor violations occurred across industries, and many by contractors based outside of Massachusetts. In fiscal year 2018, Fair Labor conducted 247 “field visits” across Massachusetts to investigate unfair pay practices, which found both civil and criminal violations in various businesses.

Healey said her office chose to prioritize wage theft in the construction industry last fiscal year, which resulted in nearly $1.5 million in penalties and restitution, according to the report. In that time Fair Labor issued citations or other assessments against 61 different employers in the construction industry.

Methuen’s E.J. Paving Company, Florida-based contractor Southern Road and Bridge, LLC and J. Donlon & Sons Inc., which worked on a public works project in Medford, were among the “notable cases” listed in the report, all of which failed to pay workers properly in overtime pay or minimum wage.

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Winchester construction company failed to pay workers minimum wage (MA)

Posted by National Alliance for Fair Contracting on

Posted Aug 1, 2018 at 5:46 PM

A Winchester construction company J. Donlon and Sons Inc. has paid more than $121,000 in wages and penalties for violating the Massachusetts prevailing and minimum wage laws by failing to properly pay workers on a Medford public works project, Massachusetts Attorney General Maura Healey announced today. The company is located at 86 Cross St. in Winchester.

“This company and its owners gained an unfair advantage by cheating their workers out of the wages they earned,” said Attorney General Healey in a press release announcing the settlement. “With this settlement, we are sending a message that there are serious consequences to breaking our laws.”

J. Donlon and Sons Inc.’s owner Joseph M. Donlon Sr., and his two sons Joseph M. Donlon Jr. and Sean Donlon, were cited for intentionally failing to pay prevailing wage, failing to submit true and accurate certified payroll records, failing to pay the state minimum wage and failing to maintain true and accurate general payroll records from January 2012 through December 2016, according to the release. As part of the settlement, the company and all three corporate officers are prohibited from bidding or working on any public works construction project in Massachusetts for 10 years.

The attorney general’s Fair Labor Division began investigating J. Donlon and Sons after a former employee submitted a complaint alleging he was not paid the proper prevailing wage rate for work performed on a city of Medford utility trench patching public works project. According to the release, the attorney general’s office determined that employees on the project were paid far less than the established prevailing wage rate. During one three-year period, for example, employees were paid an hourly rate of between $8 and $20 when they should have been paid between $51.35 and $54.10 per hour.

The company also submitted certified payroll records to the city of Medford during certain years that listed only members of the Donlon family as having worked on the project and omitted other employees, the attorney general’s office stated. The investigation found that general payroll records were also inaccurate, and two employees were paid less than the applicable minimum wage.

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AG orders Methuen paving company pay restitution for wage theft (MA)

Posted by National Alliance for Fair Contracting on

By Zoe Mathews (zmathews@eagletribune.com)
Jul 20 2018

BOSTON – A Methuen paving contractor and its president have been cited $172,554 in restitution and penalties for violating the Massachusetts overtime law for work performed on various public works projects across the state, Attorney General Maura Healey announced Friday.

“State prevailing wage laws ensure that companies working on public works projects do not cut corners to gain an unfair competitive edge,” said Healey in a press release on Friday. “This company cheated its workers out of overtime pay and with this action by my office, will now pay them what they are owed.”

The AG’s Fair Labor Division began an investigation into EJ Paving and its president, Thomas Evangelista, after receiving a complaint from an employee alleging he was not paid overtime for all hours worked in excess of 40.

The investigation revealed the company paid overtime to its employees after they had worked in excess of 45 hours during a week, though the law requires employees be paid time and a half after working more than 40 hours a week.

The investigation also revealed that when employees worked on both private and public works projects during the same week, EJ Paving failed to account for the different hourly rates of pay when overtime was calculated.

The AG’s office issued one citation for failure to pay overtime, which EJ Paving has paid in full, according to the release.

(See Article)

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Plymouth man sentenced for wage theft, ordered to pay $100,000 back to workers (MA)

Posted by National Alliance for Fair Contracting on

By Alana Levene GLOBE CORRESPONDENT
JUNE 07, 2018

A Plymouth man accused of swindling dozens of his construction employees out of their wagespleaded guilty Tuesday in Suffolk Superior Court and ordered to pay them nearly $100,000 in restitution, prosecutors said.

Joseph B. Kerrissey, III, 41, was also sentenced to three years of probation, and barred for bidding on public works projects for five years, state Attorney General Maura Healey announced Wednesday.

Kerrissey and his two companies, J. Kerrissey LLC and Sunrise Equipment & Excavation Inc., pleaded guilty to more than one hundred charges including willful wage and hour violations, larceny, and failure to pay the state’s prevailing wage from 2011 to 2017, prosecutors said.

Kerrissey will have to pay $91,743 to 37 former employees of the two companies,which did public construction projects in Hanover, Weston and West Tisbury, the statement said.

“For years, this employer refused to pay his workers and took intentional steps to make it impossible for them to obtain their wages,” Healey said in the statement. The transgressions included bouncing payroll checks, not issuing checks, shaving hours from paychecks, and paying employees less than their agreed-upon rate, prosecutors said.

Prosecutors launched an investigation after several employees complained about not getting paid by Kerrissey, who was indicted in 2016.

He made up an array of excuses to avoid paying, including “telling employees the money should be in the account, saying they did not earn the wages or had to work for nothing, and threatening to take out criminal complaints if they attempted to use the legal system to obtain their wages,” according to the statement.

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Mass. SJC Rules Independent Contractor Statute Doesn’t Apply in Workers’ Comp Case (MA)

Posted by National Alliance for Fair Contracting on

By Elizabeth Blosfield | May 16, 2018

The Massachusetts Supreme Judicial Court (SJC) has ruled the state’s independent contractor statute does not determine whether a claimant is an employee eligible for workers’ compensation benefits in a case that has led to questions about worker misclassification.

“Worker misclassification is a serious problem, both in our Commonwealth and across the nation,” SJC Chief Justice Ralph Gants wrote in a concurring opinion regarding the case.

This issue has come to light after a recent case involving claimant Ives Camargo, in which she sought review of a decision made by the reviewing board of the Department of Industrial Accidents regarding a claim she made for workers’ compensation benefits.

The board had affirmed the findings of an administrative judge by concluding Camargo was an independent contractor not entitled to workers’ compensation. Its decision was based on the definition of an employee in Massachusetts’ workers’ compensation statute.

“The law governing employment relations in this state remains far from uniform.”

After Camargo appealed, the case was transferred to the SJC, which upheld the decision that she is an independent contractor not eligible for workers’ compensation.

In the wake of the case, however, Gants called for the Massachusetts Legislature to consider greater uniformity among laws that classify workers. He added that part of the challenge in preventing misclassification is that there is no uniform definition of an employee. Instead, the law defines employees and independent contractors by several different standards depending on the context.

“In 2004, the Massachusetts Legislature took a significant step toward harmonizing these standards, amending the independent contractor statute…so that its presumption in favor of employee status applied not only to the wage and hour laws….but also to the minimum wage and overtime laws,” Gants wrote. “However, the law governing employment relations in this state remains far from uniform.”

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Somerville community groups demand union labor during Clarendon Hill construction (MA)

Posted by National Alliance for Fair Contracting on

Posted Apr 18, 2018 at 2:13 PM

A coalition of community groups and unions are campaigning to ensure that a for-profit developer pays prevailing wages and uses union labor on a public-private partnership to rebuild the public housing at Clarendon Hills.

The for-profit developer, Redgate, along with non-profit developers Preservation of Affordable Housing (POAH) and Somerville Community Corporation (SCC),are planning to renovate Clarendon Hill Apartments in Somerville and build market rate units to pay for it.

Public-private partnerships like this are part of a trend in to finance the redevelopment of existing public housing. The developers seek to minimize costs by getting a pass on the state’s prevailing wage law.

“We agree that the residents of Clarendon Hill should reside in the best housing possible, and that high quality affordable housing in Somerville should be accessible to all,” said Jaril Gauthier, a sheetmetal worker and Somerville resident. “However, we are opposed to the notion of betraying one important mission for another, especially when a private interest stands to make tens of millions of dollars off this so-called public-private “partnership.”

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LABOR COUNCIL HOPES TO MAKE CONTRACTORS PAY IN LYNN (MA)

Posted by National Alliance for Fair Contracting on

BY THOMAS GRILLO|
November 28, 2017

LYNN – If a group of union organizers gets their way, contractors who violate the state’s labor laws would be barred from doing business with the city.

Three dozen members of the North Shore Labor Council, a coalition of 50 unions representing 18,000 workers, crowded a City Hall hearing room Tuesday to urge the City Council to adopt an ordinance that would prohibit the city from hiring companies who have failed to pay their workers.

“Our goal is to protect workers from being cheated and keep them from getting these contracts while helping honest businesses,” said Kathryn Cohen, an organizer with the North Shore Labor Council.

Of the 14 firms prevented from doing work for the state or municipalities for public construction or public works projects by the Attorney General Maura Healey’s office over the last two years, one is from Lynn. Since 2015, there have been 26,767 wage complaints and citations issued statewide, 69 to Lynn companies.

At issue is the failure of some employers to pay their employees for work performed. While the state prohibits employers who have violated labor laws from seeking government contracts, some are able to sign deals because no one is checking, Cohen said.

“We know some debarred contractors are still getting work and we need to strengthen enforcement,” she said.

Under the proposed ordinance, a volunteer Wage Theft Advisory Council would be appointed by the mayor and City Council. The six-member panel would review lists of companies who violate labor laws from the Attorney General’s office and sign off on the company seeking work from the city.

The Massachusetts Budget and Policy Center reports $700 million worth of wages go unpaid annually to about 350,000 Massachusetts workers. Of that number, $5.2 million in wages is recovered by the Attorney General’s Fair Labor Division.

Ward 6 City Councilor Peter Capano said the ordinance is crucial because without it, honest employers are at a disadvantage.

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Senator Lewis: We Need To Do More to Stop Wage Theft

Posted by National Alliance for Fair Contracting on

It is estimated that nearly $700 million is not paid to about 350,000 mostly low-wage workers each year in Massachusetts.

By Bob Holmes (Patch Staff)
Updated Oct 6, 2017 2:12 pm ET

An Op-Ed Column from Senator Jason Lewis and Representative Paul Brodeur:

Earlier this year, at the start of the new legislative session, we were pleased to be appointed by the Senate President and House Speaker, respectively, to co-Chair the Joint Committee on Labor and Workforce Development. Together, we have since immersed ourselves in a wide range of labor and employment issues in the Commonwealth. We have held committee hearings on proposed legislation, met with many different stakeholders to hear their concerns and feedback, and conducted research on policies and best practices around the country.

One particular issue that may surprise many people is the serious problem of wage theft. Wage theft is a collective term for any denial of wages or benefits that are rightfully owed to an employee. The most common wage theft violations in Massachusetts are non-payment of wages, failure to keep true and accurate records, failure to pay the proper overtime rate, child labor violations, failure to pay minimum wage or tips, and failure to pay prevailing wage. Other violations include failure to submit accurate payroll records, earned sick time violations, and improper classification of employees as independent contractors.

Just how pervasive is wage theft? It is estimated that nearly $700 million is not paid to about 350,000 mostly low-wage workers each year in Massachusetts. In addition to the harm this inflicts on struggling working families, it also cheats the state out of greater economic activity, jobs, and tax revenue.

The Attorney General’s Office (AGO) is the state’s primary enforcer of laws relating to wages. Enforcement is carried out by attorneys and investigators in the AGO’s Fair Labor Division (FLD). In Fiscal Year 2017, the FLD received 16,684 calls and 5,604 complaints, and opened 607 cases related to wage theft. The FLD ordered employers to pay more than $6 million in restitution and more than $2.6 million in penalties. This is more than double the restitution ($2.6 million) and about triple the penalties ($900,000) from Fiscal Year 2016. The FLD also cited or settled 27 earned sick time cases, totaling $160,000 in restitution and penalties. And, the FLD issued 47 citations to 46 employers and assessed more than $270,000 in penalties for child labor law violations.

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Massachusetts contractor to pay $100,000 for alleged wage law violations (MA)

Posted by National Alliance for Fair Contracting on

by Mark Iandolo |
Aug. 16, 2017, 8:47am

BOSTON (Legal Newsline) – Massachusetts Attorney General Maura Healey announced Aug. 8 that Wilmington Wiring Corporation (WWC) and owner John Garrett will pay more than $100,000 after allegations of intentionally failing to properly pay employees working on a public project for the city of Worcester to repair streetlights.
Healey’s office cited the defendants with failure to pay the prevailing wage, failure to furnish payroll records, and failure to furnish certified payroll records to the Attorney General’s Office.

According to Healy, the defendants failed to pay six employees the right wages on the public works project. Massachusetts has a prevailing wage law mandating that contractors and subcontractors working on public construction projects need to pay employees a special minimum wage based on occupational classification.

“Prevailing wage laws ensure workers are paid a real, living wage and level the playing field for companies that play by the rules,” Healey said. “Workers, honest employers and taxpayers lose when companies fail to follow wage and hour laws.”

Assistant attorney general Erik Bennett and investigator Tom Lam, both of Healey’s Fair Labor Division, handled the case for Massachusetts.

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A labor voice at Harvard: ex-union leader to study the underground economy (MA)

Posted by National Alliance for Fair Contracting on

JULY 17, 2017
DEIRDRE FERNANDES

Mark Erlich was a familiar figure at construction sites as executive secretary of the state’s carpenters union. Now Erlich is hitting the hallowed halls of Harvard.

He’s joining the Labor and Worklife Program at Harvard Law School as a fellow. He’ll be working with professors and researchers at Harvard and other universities on issues of wages and the underground economy.

It’s a topic, he said, that is important not just for the construction industry but for the broader economy.

The research will focus on the rise of independent contractors and under-the-table compensation and how that affects public revenues, as well as identifying best practices for wage-enforcement programs.

During his 12 years heading the New England Regional Council of Carpenters, Erlich was a consistent voice against wage abuses, pushing legislators to strengthen penalties for wage theft.

Erlich said several heavy-hitters on labor issues from the Obama administration are now in the Boston area, and he hopes to work with them as they explore a changing economy in which companies rely more on contractors, rather than full-time staff.

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