"Anybody driving along Route 1 in Portsmouth NH this morning couldn't help notice a large banner being held in front of the new fire station that is under construction. The message on the banner pointed readers to website called anyonebutkalvin so that local tax payers could find out how their taxes are feeding the underground economy. Can this be true? A publicly funded project that the local taxpayers fund, associated with the ?? Underground Economy??? How can this be possible and what exactly does this mean?"
Kal-Vin Construction Management has run into more bad publicity, this time in Vermont, where they have been hired to perform work at Stowe Mountain Resort??s Spruce Peak project. The Stowe Reporter ran a story on Thursday after NERCC organizers and members were handing out leaflets questioning the use of Kal-Vin at the resort by the general contractor, Pizzigalli Construction. (Stowe Reporter requires free registration)
The leaflet brought to light the fact that Stowe Mountain Resort is owned by AIG, the now-infamous financial services company which was given direct payments or credit lines of more than $150 billion. Interesting that AIG continued to pay out a similar amount in retention payments and bonuses to employees and then a company notorious for cutting corners on carpenters by skirting tax and insurance laws does work for them.
The company, which operates under the names Kal-Vin, GNPB and Northrock, has apparently changed strategies and is now using more of a ??no comment?? strategy when dealing with unpleasant media inquiries. They refused to comment for the Stow Reporter story.
Also last month, one of their subcontractors working on a Hyatt Place in Montville, Connecticut??Matrix Interior Construction??was issued a Stop Work order for violations of workers compensation and independent contractor laws. An owner of that company has also been involved in a major drug case, after he sold oxycontin to undercover law enforcement agents.
Bannering activity in Hanover, New Hampshire has caused quite a stir, with threats of a slander lawsuit against the union and forceful denials of wrongdoing. But in the last line of a news article on the activity--triggered by the use of Engleberth Construction hiring Kal-Vin to do drywall--a Kal-Vin spokeswoman is asked directly about the companies use of intermediaries who hire "independent contractors" to do work. Her response? "I can't speak on that." Maybe they'll reconsider the lawsuits?
The project in question is Kendal at Hanover's renovation of a health center. Last week union organizers showed off a banner near Dartmouth College Green featuring Rebecca Smith, Kendal's Executive Director and saying she was "Wanted for Supporting Tax Fraud."
NERCC Organizer Marty Coyle told the Valley News "She need to accept some of the responsibility for what's happening under her care. It's very significant, and it's a huge problem, and we wish she would take it seriously."
Numerous times union organizers attempted to meet with Smith or her staff to alert them to the problems previously encountered on Kal-Vin jobs. Kal-Vin- and its sister companies GNPB Construction and Northrock Construction- have become infamous in the industry for problems on their jobs, ranging from misclassifying their own carpenters as "independent contractors," exploitation of immigrant workers and denying employee status and workers comp coverage to an employee who was seriously injured after he fell from scaffolding. The injured worker, Celso Mena, was later ruled to be an employee and awarded comp coverage and lost wages.
Northrock Construction--sister company to GNPB and Kal-Vin--is mired in controversy once again. A stop work order was issued on a Montville, Connecticut project where they were hired to do drywall. A "Stop Work" order was issued by the Connecticut Department of Labor at the Hyatt Place Hotel site against Matrix Interior Construction, a subcontractor hired by Northrock. The counts include: --Failure to secure payment of workers compensation --Misrepresenting employees as independent contractors --Understating or concealing payroll records
In addition to their on-site problems, an owner of Matrix has run into significant other trouble with law enforcement recently. Earlier this year, Scott LeDoux was arrested in New Hampshire for selling more than 400 oxycontin pills worth an estimated $18,000. The federal government is currently suing to take possession of property owned by Ledoux including equipment and furnishing from an mixed marshal arts gym in which it is alleged LeDoux made drug sales.
How and why did an accused drug dealer get to the point where their job was shut down by the state government without Northrock taking action of its own? The Hyatt Place Hotel might be asking the same question.
They're aware of the misclassification problem within state government, but they seem resigned to being able to do little about it. Vermont News Guy writes a considered piece on his blog about the issue.
The practice - scorned as "1099ing," by construction union officials (for the Internal Revenue Service form that freelance workers fill out) -short-changes Worker Compensation, Unemployment Insurance and Social Security funds. It also "creates an unlevel playing field," in the words of Vermont Labor Commissioner Patricia Moulton Powden. Businesses that play by the rules can be underbid by their competitors who do not.
Powden said that before adding more enforcement officers, the state should streamline its laws, which now include "no fewer than three definitions" of how to distinguish between employees and independent contractors, so that "it can be very confusing for small business to know which way (it is) supposed to go."
With her boss, Gov. Jim Douglas, intent on cutting the state work-force, Powden could hardly support adding more workers to her own department. Bouchard of the Carpenters Union said Powden was too concerned with being considered "anti-business" if her department cracked down on labor law violators. But Powden said one step she favored was increasing the fines that companies in violation now pay.
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