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

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)

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)

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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Massachusetts construction company $160,000 for wage violations on nine public projects in state (MA)

by Mark Iandolo |
Jul. 19, 2017, 9:40am

BOSTON (Legal Newsline) – Massachusetts Attorney General Maura Healey announced on July 12 that a New Hampshire-based construction company will pay roughly $160,000 for allegations of failing to pay employees the proper prevailing wage and overtime for nine public works projects completed between 2014 and 2015.

Healey’s office specifically filed three citations against Northeast Partition Specialties Inc. and owner Fredrick Breth. The defendants purportedly failed to pay prevailing wage,overtime or submit true and accurate certified payroll records.
“Companies that do business in Massachusetts must play by the rules,” Healey said. “Prevailing wage laws are intended to ensure a level playing field for companies and provide a real, living wage to workers.”

The defendants allegedly committed the violations while working on public projects that included SSGT James J. Hill School in Revere, Bresnahan Elementary School in Newburyport, Acushnet Police Facility, Chelmsford Fire Department, Dracut Town Hall, Sudbury Police Department, Park Avenue Elementary in Webster, West Bridgewater Middle-Senior High School, Westborough Fire Department.

Handling the case for Massachusetts are Erik Bennett, assistant attorney general, and investigator Tom Lam.

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Wage theft demands legislative response, advocates say

June 21, 2017
By Katie Lannan and Colin A. Young
STATE HOUSE NEWS SERVICE

Supporters of legislation aimed at preventing wage theft painted a picture of an urgent need for action on Tuesday, telling lawmakers that Massachusetts workers across all industries are denied hundreds of millions of dollars annually.

A bill (S 999/H 1033) filed by Sen. Sal DiDomenico and Rep. Aaron Michlewitz seeks to prevent wage law violations by allowing the issuance of stop-work orders until violations are corrected and giving Attorney General Maura Healey’s office the power to bring wage theft cases to court for civil damages.

“We’ve seen people not get paid for months on end,” Steve Joyce of the New England Regional Council of Carpenters told the Labor and Workforce Development Committee. “They’re selling what they have in order to live. That’s just wrong, and you have the opportunity to change this by passing this bill.”

Eleven months into the 2017 fiscal year, Healey’s office has received 16,000 calls to its wage theft hotline, or about 70 per day, said Cynthia Mark, the chief of Healey’s Fair Labor Division. More than 5,000 complaints have been made to the office, and the division is on track to resolve nearly 600 cases through citation or settlement. It has ordered employers to pay almost $5 million in restitution in and more than $2 million in penalties to the state’s general fund.

The bill is opposed by business groups, 16 of which signed on to a letter to the committee arguing that the solution to wage theft is not in a new law “but rather in enhanced enforcement efforts and additional funding for the Attorney General’s office to enable her staff to use the tools currently in place.”

“This bill, in its current form, will unfairly punish legitimate and law-abiding companies in all industries across Massachusetts who contract with other businesses for services, but have no control over the operations of those independent businesses,” said the letter, signed by the Associated Industries of Massachusetts, Greater Boston Chamber of Commerce, NAIOP Massachusetts, the Retailers Association of Massachusetts and other groups. “If a company violates the current laws, the company in violation should be penalized through existing statutes and regulations, which ensure fair and timely payment of wages.”

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Columnist Dennis Bidwell: Addressing downtown Northampton’s challenges (MA)

By DENNIS BIDWELL

Monday, June 05, 2017
The Northampton City Council Committee on Community Resources, through public forums and a variety of presentations and submitted reports, has learned a great deal about both the strengths of the local economy, particularly as it affects downtown Northampton and the center of Florence, and about a variety of local challenges.
The efforts of the Pioneer Valley Workers Center and several labor unions produced considerable testimony, particularly from restaurant and construction workers, about their experiences with some local employers failing to comply with wage and labor laws. We also heard from restaurant owners describing their compliance with these laws, as well as their concern that the media’s attention on just one perspective about the issue left many restaurant owners feeling they were maligned as a group.

This attention to wage-theft issues yielded three actions taken by the city. First, issuance by the mayor of an executive order requiring that all contractors seeking procurement contracts with the city, or seeking tax increment financing agreements, certify their compliance with wage and hour laws. Second, passage by the City Council of a resolution declaring Northampton a fair employment city, and calling on the city’s License Commission and Community Preservation Committee to adopt similar requirements regarding contractor certifications. And third, urging additional wage-theft enforcement powers and resources for the state attorney general’s office, and approval of a council order requiring all applicants coming before the council for licenses to affirm their compliance with wage and labor laws.

Workers building high-end apartments in Worcester claim wage theft and payroll fraud

By Melissa Hanson
on April 25, 2017

 

Five local carpenters who were working on a mixed-use building that includes high-end apartments in downtown Worcester are claiming that they were victims of wage theft and payroll fraud.

The carpenters, who were employed by P&B Partitions, a contractor based in West Berlin, New Jersey, say they were victims of wage and hour violations. Three of the carpenters have filed wage complaints with the Massachusetts Attorney General’s office, according to a statement from the New England Regional Council of Carpenters.

According to the wage complaints, P&B did not pay the carpenters for all hours worked and frequently paid the workers for overtime hours in cash and at less than the rate required by state law.

Dave Minasian, a spokesman for the New England Regional Council of Carpenters, said the amount of money the workers claim they were bilked of is not being released at this time.

P&B said they did not have anyone immediately available to comment on the complaint. Minasian said P&B has not responded to his organization.

The Worcester Carpenters Union is assisting the workers in recovering the allegedly lost wages.

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Massachusetts settles with three construction companies that allegedly violated wage laws

by Mark Iandolo |
May 23, 2017, 8:52am

BOSTON (Legal Newsline) – Massachusetts Attorney General Maura Healey announced May 15 that three construction companies in the state will pay more than $600,000 for allegations of failing to pay the proper prevailing wage rate to employees for work performed on public projects.

“Our prevailing wage laws ensure a level playing field for contractors who perform work for public entities, including municipalities, schools, libraries and housing authorities,” Healey said. “When contractors skirt these laws, they not only cheat employees out of their wages, they undermine the competitive business environment of Massachusetts.”

The citations came against Ronan Jarvis, former owner of MC Starr Companies Inc., DANCO Management Inc. and its owner Daniel Tremblay, and R&A Drywall LLC and owner Allan S. Vitale.

Massachusetts state law mandates that contractors and subcontractors pay employees a special minimum wage determined by the state for any work done on public construction projects.

The Jarvis and R&A Drywall cases are being handled by assistant attorney general Erik Bennett and investigator Tom Lam, both of the department’s Fair Labor Division. Assistant attorney general Barbara Dillon DeSouza and inspector Brian Davies, both of the Fair Labor Division, are handling the DANCO case.

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Pols working on wage-theft bill (MA)

By Katie Lannan, State House News Service
UPDATED: 04/26/2017 09:25:02 AM EDT

BOSTON — Workers’ rights advocates and labor leaders pledged Monday to pass into law this session a bill aimed at preventing wage theft by employers.

During a press conference in support of the bill, its backers said wage theft — a business’s underpayment, non-payment or denial of benefits to a worker — particularly hurts immigrants and can pose a barrier to families trying to move up into the middle class.

“I’m not labeling the entire employer community criminals, because the large majority of them are law-abiding and play by the rules and they deserve protection, but those employers that steal the wages from their workers are criminals,” Massachusetts Building Trades Council President Frank Callahan said. “It’s theft and stealing. They don’t carry guns, they don’t wear masks. They wear suits like this and they steal money from people who wear workboots and go to work every single day.”

The bill (S 999/H 1033) seeks to prevent wage law violations by allowing the issuance of stop-work orders until wage violations are corrected and giving the attorney general’s office the power to bring wage theft cases to court for civil damages.

Attorney General Maura Healey described a growing problem in Massachusetts, saying she has hired new investigators and expanded multilingual outreach efforts to combat wage theft. She said her office last year fielded over 20,000 calls from people reporting stolen wages and received 6,000 complaints.

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OSHA fines MA contractor $1.5M for 18 violations in fatal trench collapse

April 17, 2017
Dive Brief:
  • The Occupational Safety and Health Administration has cited a Massachusetts contractor with 18 safety violations and fined the company $1,475,813 in relation to a Boston trench accident that killed two workers in October 2016, according to an agency press release.
  • Employees of Atlantic Drain Service Co., Robert Higgins and Kelvin Mattocks, were killed while working in a 12-foot-deep trench that collapsed and broke a fire hydrant supply line. According to OSHA investigators, the trench filled with water within seconds.
  • OSHA said Atlantic did not provide basic trench safeguards and did not train employees to recognize hazardous conditions. The company and its owner, Kevin Otto, were charged earlier this year in a Suffolk County court with two counts of manslaughter and other charges related to the worker deaths.Dive Insight:

    OSHA has reported that two workers are killed every month in trench collapses, and last November, the agency found that 2016 trench fatalities had doubled since 2015.

    Aside from Atlantic’s almost $1.5 million fine, another notable element of this case is the fact that there is a press release at all. This marks the first public “shaming” citation and penalty announcement that OSHA has posted to its news releases page since President Donald Trump took office in January. While it once actively posted releases about enforcement action to that page, it now is largely reserved for announcements of safety initiatives and partnerships. However, the agency has included certain news of enforcement actions in its QuickTakes newsletters.

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