Some contractors avoid workers’ comp to win low construction bids

Reported by Demetria Kalodimos
Posted: Feb 17, 2016 7:18 PM EST Updated: Feb 17, 2016 10:31 PM EST

NASHVILLE, TN (WSMV) –
The amount of growth in downtown Nashville requires a lot of labor, but not every worker is equally protected in case of injury.

The practice of winning low bids by avoiding workers’ compensation payments is called worker misclassification.

The Channel 4 I-Team has found the same thing uncovered nearly five years ago at the Music City Center is now happening right across the street.

In 2011, a drywall subcontractor with a large workforce was failing to deduct taxes of any kind or pay workers’ compensation or overtime.

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A Step Closer to Paid Sick Leave

By Secretary Tom Perez
on February 24, 2016

Too many workers this morning had to choose between their health and their paycheck. They had to weigh the benefits of treating their cough or fever with the costs of losing a day’s pay or putting their jobs on the line. Without access to paid sick leave, they bundled up, went to work and hoped for the best.

Nearly 44 million workers in the U.S. don’t get any paid sick leave from their employers. That means when illness strikes, nearly 40 percent of private sector workers face a difficult choice: go to work to earn the full paycheck they so desperately need, or make a financial sacrifice – and risk losing their job – to stay home to care for themselves or a family member.

But a lack of paid sick leave doesn’t just jeopardize a family’s well-being and security – it is a threat to public health and just plain bad for our economy. When parents can’t stay home and are forced to put a sick child on a school bus, they endanger the health of their child and other children. When people go into work sick, they risk infecting their coworkers and customers. The lost wages from staying home sick means less money in workers’ pockets to spend on basic necessities, hurting local businesses that depend on their spending.

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No, raising the local minimum wage doesn’t hurt local businesses

By Jared Bernstein and Ben Spielberg
February 26

In 1938, President Franklin D. Roosevelt signed the nation’s first minimum-wage law. It set the wage at $0.25 an hour and covered only a fifth of the workforce. Speaking to the country the night before he signed the bill, Roosevelt told listeners to “not let any calamity-howling executive with an income of $1,000 a day” tell them “that a wage of $11 a week is going to have a disastrous effect on all American industry.”

Last August, almost 80 years later, the city council of Birmingham, Ala., voted 7 to 0 (with one abstention) to become the first city in the Deep South to enact a minimum wage above today’s federal level of $7.25. The ordinance planned an increase to $8.50 per hour by July 2016, with a second increase to $10.10 set for July 2017.

In response, state lawmakers leapt from “calamity-howling” to obstructionism. The Alabama legislature this past week passed a bill designed to block Birmingham and other cities not just from raising the local wage floor but also from mandating benefits such as paid sick leave. Alabama House Speaker Mike Hubbard (R) insists that the bill isn’t about the policies themselves but about preventing “all sorts of problems” that arise when cities are allowed to set their own minimum wages, presumably because there’s nothing preventing local businesses from relocating to avoid the higher labor costs engendered by an increase.

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Prevailing Wage States Have Fewer Job Separations in Construction

Feb 29
Posted by Frank Manzo IV

Labor economists have explained that lower job turnover is one of the reasons why raising the minimum wage has very little impact on employment, contrary to classical economic theory. … They found that separations, new hires, and turnover rates declined significantly after a minimum wage hike.

Prevailing wage is essentially a minimum wage for public construction. Prevailing wages reflect local labor standards and require that contractors pay workers at least the rate established in the private marketplace through competitive practices. …

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New Weapon in Day Laborers’ Fight Against Wage Theft: A Smartphone App

By LIZ ROBBINS
MARCH 1, 2016

Just past sunrise on 69th Street, near a No. 7 subway stop in Queens, men in backpacks and work boots gather in groups, many on their cellphones.

They are workers at one of the largest day laborer stops in New York City, hoping to be hired. Most are undocumented immigrants who have reported being cheated by employers. In the fight against wage theft, their phones could soon become their biggest allies.

After three years of planning, an immigrant rights group in Jackson Heights is set to start a smartphone app for day laborers, a new digital tool with many uses: Workers will be able to rate employers (think Yelp or Uber), log their hours and wages, take pictures of job sites and help identify, down to the color and make of a car, employers with a history of withholding wages. They will also be able to send instant alerts to other workers. The advocacy group will safeguard the information and work with lawyers to negotiate payment.

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SAVE THE DATE – 18th Annual NAFC Conference – San Diego, CA – Oct. 16-19, 2016

March 3, 2016

NAFC will be holding their next Annual Conference in sunny San Diego, CA. The Conference will be held at the Hilton San Diego Resort and Spa on Mission Bay, just outside downtown San Diego. This year’s Conference will be jointly sponsored by the Center for Contract Compliance and will have a national and California state specific focus. The NAFC National Conference is attended by several hundred participants from across the nation, including representatives from labor organizations, fair contractors, fair contracting compliance organizations as well as researchers, academics, attorneys and officials from federal, state and local governments.

Stay tuned for further information.

Business-labor partnership tackles wage theft on public projects

By Barb Kucera, Workday Minnesota
February 22, 2016

ST. PAUL – A joint effort between contractors and building trades unions has led to stronger enforcement of state laws on public construction – making a big dent in cheating and recovering nearly $1 million in stolen wages and benefits.

The partnership could be a model for addressing wage theft in other industries.

The federal government adopted wage standards for taxpayer-funded construction projects in 1931, when President Herbert Hoover signed the Republican-authored Davis-Bacon Act. In the decades since, many states, including Minnesota, and many local communities have followed suit.

Known as “prevailing wage” laws, these regulations require contractors bidding on publicly funded projects to pay wages and benefits in line with those of a particular location. In Minnesota, the state conducts surveys to determine the prevailing wages for different communities.

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New Study: Prevailing Wage Law Would Boost New Hampshire Jobs, the State Economy, and In-State Contractors

January 14, 2016
A new study released today by leading national researchers on the construction industry finds that a proposed New Hampshire prevailing wage law would boost the state economy by at least $300 million, create several thousand jobs, and increase state and local tax revenue by up to $17 million.

The report, published by the Keystone Research Center (KRC), an independent non-partisan economic policy group, was released in advance of hearings in Concord next week on the proposed prevailing wage law. New Hampshire is the only state in New England and the Northeast that does not have such a law.

The study uses a growing body of peer reviewed research, data from the Economic Census of Construction, and industry-standard IMPLAN software to analyze the impact of prevailing wage standards for skilled construction industry trades on the New Hampshire economy as a whole and on construction workers’ wages, benefits and reliance on taxpayer-funded public benefit programs.

(PDF of Press Release)

(PDF Copy of Full Study)

UPDATE: West Virginia House votes to repeal prevailing wage

By WV MetroNews
Posted: Wed 3:17 PM, Jan 27, 2016

CHARELSTON, W.Va. (WV MetroNews) The House of Delegates Wednesday passed legislation repealing the state’s prevailing wage law that sets hourly pay rates for workers on state-funded projects. The bill (HB 4005) now goes to the Senate.

The 55-44 vote followed an emotional debate on the House floor between supporters and opponents of the legislation as labor union members and business backers looked on from the gallery.

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Kentucky House panel defeats prevailing wage exemption bill

By Bruce Schreiner | Updated Feb 4, 2014

FRANKFORT, Ky. (AP) – Cheered on by a roomful of union construction workers, a Kentucky House committee on Thursday defeated a Republican-backed bill to exempt public school projects from the state’s prevailing wage.

The arguments and outcome echoed past years when Senate Republicans made the prevailing-wage exemption a top priority, only to watch it stall in the Democratic-led House.

Republican Sen. Wil Schroder, the bill’s lead sponsor this year, said the issue will certainly resurface next year when the General Assembly’s political dynamics could be changed

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