Labor leader: Prevailing wage protects workers from ‘race to bottom’

Posted by National Alliance for Fair Contracting on

By Matt Glynn , and Jonathan D. Epstein
Published June 30, 2017 | Updated June 30, 2017

New York State has had a prevailing wage law since 1894, and supporters say it’s needed to protect workers from being undercut and underpaid by contractors and government agencies. They also argue that prevailing wage laws help ensure that the size of public contracts – and the potential for a bidding race to the bottom to win them – don’t destabilize local and regional construction markets.

But critics say the laws hurt free-market competition, drive up costs on public projects and provide little real 30benefit to the economy other than protecting labor unions.

Conservative researcher E.J. McMahon and union advocate Richard Lipsitz Jr. recently sat down with The News to talk about the controversy over the state’s prevailing wage requirements.

Richard Lipsitz Jr. sees the prevailing wage law as protection against the “race to the bottom.”

The president of the Western New York Area Labor Federation, AFL-CIO, an umbrella organization covering 100,000 union members in six counties, Lipsitz has been active in the labor movement since the 1970s, and the federation he leads has been outspoken in the drive to raise the state’s minimum wage.

Q: How does the state’s prevailing wage benefit construction workers?

A: It is a wedge against the race to the bottom in the construction field. Without provisions like prevailing wage, there would be no guarantee that a contractor wouldn’t go down and pay the minimum that he has to or she has to. It’s a rule that keeps this race from the bottom from being carried out in the construction field.

And it also helps with the workers in all other fields. The idea of a prevailing wage, as a good wage and benefits package that people can live on, is mostly talked about in the construction field. But the Commerce Department keeps a prevailing wage on all kinds of occupations in New York State, not just for building trades. So I don’t think it’s quite right to just see it as a construction trades question.

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Last minute legislation would close stolen wages loophole (NY)

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Thursday, June 15, 2017

ALBANY – A wage theft law is on the books in New York State, but there is an effort to close a loophole that allows guilty businesses to hide assets and avoid paying what is owed.

Susan Zimet of Greene County, executive director of the Hunger Action Network of New York State, is lobbying to have to close that loophole in the next several days.

“We are trying to do what is called the ‘SWEAT’ legislation, which is ‘Securing Wages Earned Against Theft’ to basically put a lien on the business at the very beginning of the lawsuit so the assets can’t be moved around and if somebody wins, they can end up actually getting the back wages,” she said.

The measure passed in the Assembly last year and Zimet expects it to be approved again this year.

She is pushing to have the bill, which is curently in the Senate Judiciary Committee, chaired by John Bonacic (R, Mt. Hope), approved before lawmakers adjourn in about one week.

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NYC invests $10M to boost minority, women participation in construction

Posted by National Alliance for Fair Contracting on
Kim Slowey
June 22, 2017

Dive Brief:

  • New York City has created a $10 million fund to assist women- and minority-owned businesses win construction projects, according to Crain’s New York Business.
  • The money will go toward paying for up to $500,000 of surety bonds per contract. City contractors are required to furnish the bonds, which guarantee they will satisfactorily perform work and pay their bills, but they are difficult to obtain for smaller companies without a track record of completed projects.
  • Aside from helping women- and minority-owned firms become successful, New York City building officials said the program will help other contractors who are required to hire a certain percentage of these firms but can’t find enough of them to meet their mandated quotas.

Dive Insight:

The city aims to issue $16 billion worth of contracts to minority- and women-owned businesses by 2025, and the bond assistance program should help it meet that goal.
Considering that federal and state governments spend hundreds of billions on public construction work and typically set aside 5% to 10% for MBEs and WBEs, the potential payoff is substantial. However, many contractors have reported difficulty finding enough qualified firms.

A.G. Schneiderman Announces Arrest Of Public Works Contractor Charged With Wage Theft Of Nearly $700K

Posted by National Alliance for Fair Contracting on

Defendant Allegedly Failed To Pay $691,040 In Prevailing Wages And Benefits To Ten Workers Performing Construction On Bronx Public Schools.

BY LONG ISLAND NEWS & PR – PUBLISHED: MAY 03 2017

New York, NY – May 3, 2017 – Today, Attorney General Eric T. Schneideman and New York City Comptroller Scott M. Stringer announced the arrest of contractor Vickram Mangru on charges that he underpaid wages and benefits to workers on a publicly-funded New York City construction project. The arrest is part of an ongoing investigation into widespread allegations of prevailing wage theft at New York City public works projects.

Contracted to perform work on several New York City Department of Education (NYCDOE) public schools in the Bronx between December 2012 and April 2014, Mangru – while doing business as Vick Construction out of Valley Stream, New York -was charged with allegedly cheating six workers out of $301,683 in wages. Vick Construction and Mangru had previously been debarred and banned for a five-year period from performing public work projects by the New York City Comptroller’s Office for failing to pay proper prevailing wages to workers. On December 31, 2013, Mangru entered into a settlement agreement, admitting he underpaid workers by $34,347 in prevailing wages and supplements.

Undeterred, Mangru allegedly continued to operate in several public schools and continued to pay well below proper prevailing wage rates, forming AVM Construction in January 2014. AVM Construction was purportedly owned by Mangru’s son Ravi Mangru and his wife Gayatri Mangru, who both claimed to be the company’s president. However, according to workers, Mangru ran the day to day operations of AVM Construction, including directly supervising the work and paying employees.

Between April 2014 and February 2015, Mangru is alleged to have continued working on multiple NYCDOE school projects in the Bronx. An investigation determined that Mangru, now operating under the umbrella of AVM Construction, allegedly failed to pay proper prevailing wages to ten workers on those school projects by an additional $389,357 during the ten-month period.

In total, Mangru allegedly failed to pay $691,040 in prevailing wages and benefits to ten workers, from December 2012 to February 2015.

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Diversity in the New York City union and nonunion construction sectors

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Press Releases • March 2, 2017

A new report by EPI President Lawrence Mishel finds that New York City’s union construction sector has become significantly more racially diverse in the past two decades and that union construction workers earn substantially more than nonunion construction workers, leading to an increased economic benefit for black and Hispanic communities.

Using newly developed data from the U.S. Census Bureau and Bureau of Labor Statistics to analyze the racial composition of blue-collar union and nonunion construction employment, Mishel finds in Diversity in the NYC construction union and nonunion sectors that New York City’s union construction sector employs a greater share of black workers than the nonunion construction sector. In 2014, black workers accounted for 21.2 percent of employment in union construction, versus 15.8 percent in nonunion construction.

Unions have also drawn more black and Hispanic workers into construction through apprenticeship programs funded jointly by unions and construction contractors, which provide wages and benefits to workers while they learn job-related skills. The share of union apprentices that are people of color was over 60 percent in 2014, more than double the share in 1994.

Hispanic and black workers in construction unions earn 34.5 percent and 36.1 percent more than nonunion Hispanic and black construction workers, respectively. Because black workers have a greater presence in the union construction sector and are paid far more, collective bargaining in New York City greatly boosts overall annual wages to the black community from construction by $152 million each year.

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(Press Release)

EXCLUSIVE: Cuomo to propose bill that clamps down on wage theft from out-of-state companies (NY)

Posted by National Alliance for Fair Contracting on

KENNETH LOVETT
NEW YORK DAILY NEWS
Saturday, January 7, 2017, 9:00 PM

 

ALBANY – Gov. Cuomo is set to propose legislation that will allow the state to aggressively go after wage theft in New York, the Daily News has learned.

The bill, to be announced as part of the governor’s State of the State agenda he’ll be releasing this week, would hold the top 10 officials from out-of-state limited liability companies, or LLCs, personally financially liable for unsatisfied judgments for unpaid wages.

The legislation will empower the state Labor Department commissioner to enforce such liabilities.

The idea, Cuomo said, is to recover more money employees were cheated out of when businesses went bankrupt – and went on to create spinoff limited liability companies registered in other states or hid their assets in other ways.

“New York is committed to ensuring a fair day’s pay for a fair day’s work and has zero tolerance for those who seek to exploit their workers,” Cuomo said.
“With this proposal we will help ensure that no matter where bad actors try to hide, they will not be able to skirt their obligations to hard-working New Yorkers. ”

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Council member pushes prevailing wages bill as a construction safety issue (NY)

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Would apply to projects receiving city money and are 50K sf or hold more than 50 housing units

January 26, 2017 05:10PM
By Kathryn Brenzel

Alongside a package of controversial construction safety bills, a City Council committee is scheduled to consider a measure that seeks to require prevailing wages on certain construction projects in the city.

The bill, first introduced by Queens Council member Elizabeth Crowley in April 2015, has been re-referred to the Committee on Housing and Buildings, and is scheduled for a hearing on Tuesday that will largely focus on construction safety measures. The proposed bill would apply to projects that receive financial assistance from the city, are larger than 50,000 square feet or, if a residential project, more than 50 units, and that don’t have a project labor agreement.

While her revived bill – which has 20 listed sponsors – doesn’t explicitly involve construction safety, Crowley says the proposed legislation will at least indirectly encourage it.

“If you’re an employer, and you’re obliged to pay the prevailing wage, my guess is that you’d want to employ someone who is trained and qualified through a state program,” Crowley said. In New York City, that likely means hiring union labor. (Before joining the City Council, Crowley was a member of a painter’s union.)

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Comptroller Stringer Debars Contractor that Cheated Immigrant Workers out of $1.7 million in Prevailing Wages and Benefits

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K.S. Contracting Corporation employed a kickback scheme that preyed on at least 36 immigrant workers

 

Newsroom / Press Releases & Statements
FEBRUARY 13, 2017

(New York, NY) – New York City Comptroller Scott M. Stringer today assessed $3.2 million in fines against K.S. Contracting Corporation and its owner, Paresh Shah, for cheating dozens of workers out of the prevailing wages and benefits they were owed under the New York State Labor Law. In addition to being assessed $3.2 million in unpaid wages, interest, and civil penalties, K.S Contracting and Mr. Shah will be barred from working on New York City and State contracts for five years. K.S. Contracting was named as one of the worst wage theft violators in New York in a report by the Center for Popular Democracy in 2015.

“With President Trump taking clear aim at immigrants across the country, we need to stand up and protect the foreign-born New Yorkers who keep our City running. Every New Yorker has rights, and my office won’t back down in defending them,” New York City Comptroller Scott M. Stringer said. “Contractors might think they can take advantage of immigrants, but today we’re sending a strong message: my office will fight for every worker in New York City. This is about basic fairness and accountability.”

K.S. Contracting was awarded more than $21 million in contracts by the City Departments of Design and Construction, Parks and Recreation, and Sanitation between 2007 and 2010. Projects included the Morrisania Health Center in the Bronx, the 122 Community Center in Manhattan, the Barbara S. Kleinman Men’s Residence in Brooklyn, the North Infirmary Command Building on Rikers Island, Bronx River Park, the District 15 Sanitation Garage in Brooklyn, and various City sidewalks in Queens.

The Comptroller’s Office began investigating the company after an employee filed a complaint with the office in May 2010. The multi-year investigation used subpoenas, video evidence, union records, and City agency data to uncover a kickback scheme that preyed on immigrant workers.

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Laborers Make Recommendations for Reforming NYC Housing Preservation and Development

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Recommendations Include Reforming HPD’s Procurement and Reporting Requirements To Combat Wage Theft And Worker Exploitation
NEWS PROVIDED BY
Greater New York LECET
Oct 31, 2016, 10:35 ET

NEW YORK, Oct. 31, 2016 /PRNewswire-USNewswire/ — Before a New York City Council hearing today, the Mason Tenders District Council, Laborers International Union of North America (LIUNA), called for reforming the procurement and reporting requirements of the Department of Housing Preservation & Development. After years of mismanagement, flawed procurement processes and corruption, Greater New York Laborers-Employers’ Cooperation & Education Trust (GNYLECET), submitted a series of recommendations at today’s Committee on Housing and Buildings hearing on Intro 967, Speaker Melissa Mark-Viverito’s and Councilmember Helen Rosenthal’s legislation to reform HPD in relation to construction conditions in housing development projects.

“Intro 967 is a great first step towards reforming HPD and leveling the playing field in their procurement process,” said Pat Purcell, Executive Director of Greater New York Laborers-Employers Cooperation and Education Trust. “For too long the same unscrupulous contractors have been receiving a steady stream of work from HPD, while their indiscretions in regards to wage theft and safety violations have been largely overlooked. If amended to include recommendations like the ones we are advocating for at the Council today, Intro 967 has the potential to rectify a long-term problem at one of the City’s most critical agencies and ensure the gold-standard of construction is being upheld when HPD looks to award projects,” Purcell said.

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Hidden NY payroll card fees eliminated

Posted by National Alliance for Fair Contracting on

Lindsey Riback, The Journal News
WGRZ 9:01 AM. EST September 09, 2016

ALBANY — Protections are now in place preventing low-wage workers from losing out on their money.

New York is requiring payroll-card companies to provide employees with access to at least one local fee-less ATM near their home or work, Gov. Andrew Cuomo announced Thursday.

In addition, account maintenance, overdraft and inactivity fees will be removed and employers will no longer receive financial benefits for paying their workers via a payroll card, Cuomo said.

Roughly 200,000 low-wage workers in New York are paid through payroll cards, which had contained withdrawal fees or charges for viewing account balances.

In many cases, the employees do not have a bank account and are required to pay ATM fees in order to withdraw their money, in addition to the initial card fees, Cuomo said.

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