unnamed

Public works contractor arrested, accused of wage theft (NY)

Posted by National Alliance for Fair Contracting on

Stephon Johnson | 8/23/2018

Authorities arrested a public contractor for allegedly skimming from his employees’ paychecks.

This week, New York State Attorney General Barbara Underwood and Port Authority Inspector General Michael Nestor announced the arrest of Marjan Kasapinov, 63, for allegedly taking more than $40,000 in wages and benefits from 28 workers employed to work on a publicly funded construction project at LaGuardia Airport. Kasapinov faces between one and four years in prison, a five-year ban from public work and payment of back wages to his employees.

Kasapinov, doing business as Paterson, N.J.-based EMLO Corp., was contracted to perform asbestos removal work on several buildings at LaGuardia Airport between March 2014 and March 2015. Kasapinov and EMLO Corp are charged with failure to pay the prevailing rate of wage or supplements, offering a false instrument for filing in the first degree and failure to secure workers’ compensation insurance-all felonies.

“Contractors that corrupt public projects and fail to pay their workers will be held accountable,” stated Underwood. “Workers deserve fair pay of the wages and benefits they’ve earned-not to be exploited by their employer. Our office will continue to work relentlessly to combat wage theft and the abuse of public dollars.”

“Companies doing business with municipalities, state agencies and authorities are legally bound to pay their employees the fair and prevailing wage,” added Michael Nestor, inspector general for the Port Authority of NY & NJ, in statement. “In this case, the defendant chose to enrich himself at the expense of his own workers. Today’s arrest will serve notice to all contractors that the Port Authority of NY & NJ will not tolerate wage fraud or any other criminal misconduct on public projects.”

(Read More)

unnamed

Manhattan Construction Company Misclassified and Underpaid Workers, Including Site Fatality Victim (NY)

Posted by National Alliance for Fair Contracting on

By WorkersCompensation.com on July 27, 2018

New York, NY (WorkersCompensation.com) – Manhattan District Attorney Cyrus R. Vance, Jr., and New York City Department of Investigation (“DOI”) Commissioner Mark G. Peters announced the indictment of CRV PRECAST CONSTRUCTION, LLC (“CRV”) and six of its employees for misclassifying workers as lesser-skilled, underpaying them, and falsifying information about payroll and employees, including a worker who was killed at a company job site. The defendants are charged in a New York State Supreme Court indictment with Insurance Fraud in the Second and Third Degrees, Grand Larceny in the Third Degree, and Scheme to Defraud in the First Degree, among other charges.[1]

“Time and again, we’ve seen how wage theft is symptomatic of an overall disregard for workers’ wellbeing: On worksites where companies regularly defraud their employees, we have also seen them playing fast and loose with their workers’ lives and safety,” said District Attorney Vance. “As alleged in this case, the defendants devalued their workers’ livelihoods, underpaying them and insuring them for lower-risk work while simultaneously sending them to carry out complicated construction projects. Misclassifying workers as lesser-skilled is a common way that employers steal from their employees, and I thank our Construction Fraud Task Force partners for their continued commitment to protecting the workers who put their lives on the line every day.”

DOI Commissioner Mark G. Peters said: “These defendants stole from their workers on City construction projects, failing to pay the legally required prevailing wage and underpaying more than $400,000 in insurance premiums, according to the charges. In trying to skirt these laws for their own benefit, the defendants’ alleged conduct has instead landed them in handcuffs and facing prosecution. DOI thanks the Manhattan District Attorney’s Office for its partnership in this case and our many joint Construction Fraud Task Force investigations.”

The indictment follows a joint investigation led by the Manhattan District Attorney’s Office’s Construction Fraud Task Force and DOI, with additional assistance by the New York State Insurance Fund (“NYSIF”).

(Read More)

bill-would-allow-cities-counties-to-opt-out-of-prevailing-wage

Letter to the editor: Prevailing wage benefits economy (PA)

Posted by National Alliance for Fair Contracting on

LETTER TO THE EDITOR
Sunday, Aug. 26, 2018, 9:04 p.m.

Regarding Ray Borkoski’s letter ( “End prevailing wage in Pa.,” July 25, TribLIVE): The benefit prevailing wage provides to the local economy is immeasurable. Prevailing wage ensures tax money is used solely to benefit the public and the taxpayer by requiring the hiring of local, skilled workers, which stimulates all aspects of the local economy. When local people are working they spend money on homes, cars, food, clothes, etc.

Without prevailing wage, we would see an increase in contractors misclassifying workers, paying cash and avoiding paying payroll taxes. This leads to a loss in state revenue in the hundreds of millions.

States with weak or no prevailing wage laws spend $367 million more a year on food stamps and earned income tax credits for blue-collar construction workers than states with prevailing wage laws.

Without prevailing wage, you also lose safety standards and responsible contractors. What is the advantage of building a bridge “cheaper”?

Prevailing wage is not a union or nonunion issue; without prevailing wage, all wages fall. The standard of prevailing wage is set by a survey of the entire construction market in a local area.

The Midwest Economic Policy Institute found that after the repeal of prevailing wage in Indiana, the lowest paid construction workers’ wages fell 15.1 percent.

Mike Bobnar
Hempfield

(See Op-Ed)

Executive order: Minimum wage for workers in gov’t-contracted construction is now $15 (Puerto Rico)

Posted by National Alliance for Fair Contracting on

By Eva Lloréns Vélez on July 30, 2018

SAN JUAN – Puerto Rico Gov. Ricardo Rosselló signed an executive order to increase the minimum wage for Puerto Rico construction industry employees to $15 an hour for government contracting. The order also requires locally produced cement for government construction projects.

In addition, the decree requires labor agreements for projects financed by the government to establish security conditions and professional training “for the protection of workers,” according to a release issued by the governor’s office, La Fortaleza, following his press conference there on the matter.

Local contractors complain that they are being discriminated against by the government in its project procurements in favor of stateside companies, which Rosselló acknowledged has happened historically, but noted differences when comparing local and mainland resource after a disaster.

“Sometimes there is not enough labor; sometimes they are huge projects that some of the local contractors do not qualify for and sometimes it’s remuneration. So what have we decided to do? We have decided to start looking for solutions,” he said at a press conference Monday.

The measure could apply to 36,000 to 44,000 construction workers, of which 21,000 are salaried employees who work for construction companies. “That is the potential universe of people that can be impacted as long as that construction company is bidding for construction work with the government,” Labor Secretary Carlos Saavedra said.

“One of the fundamental elements in the recovery of Puerto Rico is the construction industry, which is vital to be prepared for weather events and other emergencies that may affect us in the future,” the governor is quoted as saying in the release, adding that “now that Puerto Rico begins the road to reconstruction, it is indispensable that the local construction workforce be stronger than ever. We need more Puerto Rican construction workers, better trained, and better paid.”

(Read More)

U.S. Department of Labor Recovers $14.3 Million for Hurricane Recovery Workers (Puerto Rico)

Posted by National Alliance for Fair Contracting on

By Source Staff – September 25, 2018

In the year since hurricanes Irma and Maria struck Puerto Rico and the U.S. Virgin Islands, the U.S. Department of Labor’s Wage and Hour Division (WHD) has recovered $14,337,657 in unpaid wages for 7,761 employees engaged in recovery work in these territories. WHD has also undertaken significant outreach activities to educate employers and employees about compliance with federal wage laws as part of its ongoing hurricane response efforts.

Following the hurricanes, WHD began a broad-based education and enforcement initiative providing information to employers and workers via social media, and by conducting outreach. Investigations focused on compliance during short-term emergency response operations funded through the Federal Emergency Management Agency (FEMA) to ensure employers were aware of their responsibilities and employees were paid.

The investigations examined coverage under an employer’s compliance with the Service Contract Act (SCA), Contract Work Hours and Safety Standards Act (CWHSSA), Davis Bacon and Related Acts (DBRA), and the Fair Labor Standards Act (FLSA).

WHD investigators found violations that included non-payment of wages, minimum wage and overtime violations resulting from employees being misclassified as independent contractors, and failure to pay required health and welfare benefits under the SCA.

WHD has conducted more than 60 outreach events; signed memorandums of understanding (MOUs) with Puerto Rico’s Department of Labor and its Office of the Comptroller to better coordinate enforcement and outreach efforts; and hosted a prevailing wage seminar to educate contractors, government agencies, and other stakeholders about compliance with applicable laws.

(Read More)

Northam signs executive order establishing task force on worker misclassification, payroll fraud (VA)

Posted by National Alliance for Fair Contracting on

AUTHOR – Augusta Free Press
PUBLISHED – Aug 11, 2018

Governor Ralph Northam signed an Executive Order establishing an interagency task force on worker misclassification and payroll fraud. The misclassification of employees as “independent contractors” undermines businesses that follow the law, deprives the Commonwealth of millions of dollars in tax revenues, and prevents workers from receiving legal protections and benefits.

“Treating Virginia workers fairly is central to building an economy that works for everyone, no matter who you are or where you live,” said Governor Northam. “Every employer in the Commonwealth should be playing by the same rules and this task force will come up with a comprehensive plan to make sure workers aren’t missing out on the protections and benefits they would receive if properly classified.”

A 2012 report of the Joint Legislative Audit and Review Commission (JLARC) found that one-third of audited employers in certain industries misclassify their employees. By failing to purchase workers’ compensation insurance, pay unemployment insurance and payroll taxes, or comply with minimum wage and overtime laws, employers lower their costs as much as 40%, placing other employers at a competitive disadvantage.

The task force will develop and implement a comprehensive plan with measurable goals, including identifying ways to hold companies working on state contracts who commit payroll fraud through misclassification of workers accountable, and identifying ways to deter future inappropriate conduct by recommending enforcement mechanisms.

Secretary of Commerce and Trade Brian Ball will chair the task force. It will include representatives from the Virginia Employment Commission, the Department of General Services, the Department of Labor and Industry, the Department of Professional and Occupational Regulation, the State Corporation Commission’s Bureau of Insurance, the Department of Taxation, the Workers’ Compensation Commission, and the Office of the Attorney General.

The group will develop a work plan by November 1, 2018 and report to the Governor on its progress by August 1, 2019.

The full text of Executive Order Sixteen can be found here.

(See Article)

Seattle worker-rights groups uniting to create ‘one-stop shop’ for workplace wrongs (WA)

Posted by National Alliance for Fair Contracting on

By: Benjamin Romano
August 3, 2018

Working Washington and the Fair Work Center, two organizations that have been as effective as any in recent years at expanding and defending the rights of workers in Seattle and beyond, are joining forces under a new executive director.

Rachel Lauter, most recently the deputy chief of staff to New York Mayor Bill de Blasio, assumed the role of leading both organizations in late May, a first step in a merger designed to create what she describes as “a one-stop shop for worker organizing, advocacy, outreach and education and legal services.”

That’s necessary, she said, because aggrieved workers or those looking to improve working conditions may not always know what kind of help they need or where to begin.

Working Washington got its start in 2011 organizing low-wage workers to push for the nation’s first $15-an-hour minimum wage, passed by SeaTac voters in 2013, and then by the Seattle City Council in 2014. The labor-backed group has run successful campaigns – often marked by attention-grabbing stunts and protests, online and off – for predictable shift scheduling, expanded sick leave, equal treatment and, most recently, expanded protections for domestic workers.

The Fair Work Center (FWC), meanwhile, formed in 2016 with a mission of educating workers about their rights in Seattle and beyond, offering legal aid and connections to groups advocating for specific communities such as immigrants and youth. It has been awarded more than $2.5 million from the city of Seattle’s Office of Labor Standards under a grant program designed to “develop awareness and understanding of worker rights, and facilitate resolution of labor standards violations.” According to its 2017 annual report, the legal clinic helped low-wage workers recover more than $350,000 resulting from wage theft, discrimination and harassment, retaliation and other violations.

(Read More)

unnamed

CONTRACTOR SENTENCED FOR CRIMINAL WAGE THEFT, FALSE REPORTING OF WORKERS’ COMP PAYMENTS (WA)

Posted by National Alliance for Fair Contracting on

By Office of the Attorney General (Washington State)
July 27th, 2018

Alejandro Sandoval and his company must pay back $25,000 in workers’ wages

SEATTLE – A Maple Valley contractor and his company must pay back more than $25,000 in unpaid wages in addition to unreported workers’ compensation insurance after a joint investigation by the Attorney General’s Office and the Washington State Department of Labor & Industries (L&I).

Alejandro Sandoval and his company, Sandoval Construction, were sentenced today in King County Superior Court after pleading guilty to false reporting and first-degree theft. As part of the plea deal, Sandoval Construction is ordered to reimburse the workers for their unpaid wages and Sandoval will be responsible for unpaid workers’ compensation insurance payments to the state.

Under separate civil proceedings, he owes L&I at least $197,000 in unpaid premiums, interest and penalties.

“Wage theft is a crime, and as long as I’m Attorney General, those that steal from their workers will be prosecuted,” Attorney General Bob Ferguson said. “Thanks to the coordinated efforts of my office and L&I, these workers will be paid for their work.”

“People work hard and deserve to be paid fully and on time,” said L&I Director Joel Sacks. “Teaming up with the Attorney General gives us the extra hammer of criminal prosecution to collect wages for workers and reduce workers’ comp costs for employers.”

L&I enforces workplace rights and administers the state workers’ compensation insurance system that helps injured workers heal and return to work. When employers cheat and fail to pay their fair share, those who follow the rules pay higher premiums.

The Attorney General’s Office began its criminal investigation in 2016 after L&I received complaints from a dozen workers for Sandoval and his company, alleging Sandoval Construction had not paid them $25,620 in wages that they were owed.

In addition, an L&I audit revealed that Sandoval had underreported his workers’ compensation payments to the state agency, despite deducting them from employee paychecks. The audit, which covered a sampling of four different quarters, found he owed more than twice what he reported to L&I in that timeframe.

(Read More)

OSHA increases excavation and trenching enforcement after wave of fatalities

Posted by National Alliance for Fair Contracting on

Kim Slowey
October 4, 2018

Dive Brief:

  • Effective Oct. 1, the Occupational Safety and Health Administration moved forward with an updated excavation and trenching National Emphasis Program. The safety enhancements represent a renewed effort on the part of the agency to prevent excavation and trenching collapses in the wake of an uptick in trenching fatalities.
  • The program’s goal has always been to make sure onsite trenching and excavation conditions are as safe as possible for workers, but the agency will now increase its education efforts and step up enforcement. In addition, OSHA inspectors will enter records of their trenching and excavation inspections into a national reporting system. Local OSHA offices will develop outreach programs as well.
  • OSHA will wait to increase its enforcement activity until after the first three months of the initiative, during which time the agency will engage in education and prevention outreach. Inspectors will still respond to accidents, complaints, injuries and referrals during the outreach period. The updated program will remain in effect indefinitely. “OSHA will concentrate the full force of enforcement and compliance assistance resources to help ensure that employers are addressing these serious hazards,” said Loren Sweatt, deputy assistant secretary of labor for occupational safety and health.

Dive Insight:

OSHA rolls out National Emphasis Programs on a temporary basis, although some, like the ones relative to construction cranes and lead, have been active for several years. The agency’s goal is to concentrate its resources on particularly high-hazard safety issues for as long as necessary. The decision as to which areas need the most attention is made after considering inspection, injury and illness data and other relevant information.

In the case of this latest emphasis program, the agency is likely responding to U.S. Bureau of Labor Statistics data that showed a steep rise in trenching fatalities in 2016. In March, the bureau reported that that the number of excavation and trenching fatalities in 2016 was almost twice the average of the previous five years combined. At the time, the Department of Labor committed to reducing excavation and trenching hazards by 10% by Sept. 30, 2018, using 2017 data as a benchmark.

(Read More)

Measure Twice, Cut Once: Understanding the Construction Workplace Misclassification Act

Posted by National Alliance for Fair Contracting on

By: Susan Nanes
August 2, 2018

Measure twice, cut once. It’s a carpenter’s motto reminding us that it is better to spend a little more effort up front to be certain about what we’re doing than to have to spend time, money, and energy trying to fix a mistake after the fact. This article provides some background and basics of the Construction Workplace Misclassification Act (CWMA) so that attorneys practicing in the construction field will be aware of the pitfalls: should a construction employer seek to cut corners and avoid paying workers’ compensation premiums (and other required taxes), or even just err by calling its workers independent contractors, they may be subject to civil and even criminal penalties. It is better to take the time, do the due diligence and measure twice. This article will briefly explain the rationale for the CWMA’s enactment, address the previous legal approach, present the contours of the CWMA, and finally touch on Pennsylvania cases evaluating and applying the CWMA.

(Read More)