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RI DLT announces further enforcement Posted by on

The Rhode Island Department of Labor and Training (DLT) has come down hard on a cheating contractor for the second time this month, ordering Mancieri Flooring Company to pay more than $330,000 in back wages, interest and civil penalties for payroll and miscassification violations. The company has also been debarred from public work in the state for three years.

Attording to a DLT press release, Mancieri was found to have failed to pay prevailing wages for work it performed at the University of Rhode Island from 2012-2014; failed to pay overtime rates; falsely reported payments to workers on cerrified payroll records; misclassified 17 workers as independent contractors and giving workers false 1099 forms to the state to hide its behavior. Mancieri's had previously been discovered filing false payroll records on a federal prevailing wage project and continued their practices.

The company will pay $70,000 to workers, a $210,000 civil penalty and $51,000 for misclassification. The civil penalty is three time the owed wages and the misclassification penalty is $3,000 for each employee misclassified.

Just weeks ago, the DLT ordered Cardoso Construction to pay more than $700,000 for similar violations affecting 27 workers employed for work at the University of Rhode Island.





RI fraud unit makes first big splash Posted by on

The state of Rhode Island has sent its first significant message to the construction industry that Governor Raimondo's administration is serious about cracking down on payroll fraud and wage theft. Yesterday, it announced it had finalized a settlement agreement with Cardoso Construction that will have the company pay a total of $730,000 for a list of violations related to misclassification of workers.

Twenty-seven carpenters who were victimized by the scheme will each be paid about $13,000 in owed wages, totaling more than $351,000. An additional $351,000 in penalties will be paid to the state as well as a $27,000 fine; $1,000 for each employee.

The state's investigation was the result of outreach work done by Local 94 Representative Tom Savoie to carpenters working for Cardoso on a project at the University of Rhode Island. Savoie passed away earlier this year.

The state of Rhode Island formed a Joint Task Force on the Underground Economy and Employee Misclassification last year. It brings together the Attorney General's office, the Division of Taxation, Department of Business Regulation, Department of Public Safety and Workers' Compensation Court, all of which hold a piece of enforcement jurisdiction regarding misclassification. Such task forces have been effective investigative bodies in other states because they allow agencies to share information they otherwise would not, leading to faster, more effective prosecutions.





New study examines wage theft in Mass construction Posted by on

New research published by the University of Massachusetts Amherst Labor Center asserts how the illegal theft of workers’ wages, especially those of undocumented immigrant laborers, has reached epidemic levels in the residential construction industry in Massachusetts. In the working paper “The Epidemic of Wage Theft in Residential Construction in Massachusetts,” Tom Juravich, professor of sociology, with research assistants and co-authors Essie Ablavsky and Jake Williams, present three case studies examining the subcontractors for one of the nation’s largest homebuilding companies, regional drywall-hanging companies and affordable housing construction by a community development corporation.

Based on legal records, news reports and 27 in-depth interviews with construction workers, contractors, homeowners, union staff and community-based organizers, Juravich and his co-authors present evidence that contractors in residential construction responded to their financial losses from the Great Recession by the wholesale and illegal misclassification of their workers as independent contractors.

“By not paying taxes on workers’ wages and by not contributing to worker compensation funds, contractors reduced their building costs by 30 percent,” the paper states. “These contingent workers—the majority of who are undocumented immigrants—are routinely cheated out of their wages by contractors who pay late, do not compensate for overtime, and sometimes do not pay for work at all. Firms generate profits by victimizing some of the most vulnerable workers in Massachusetts, delivering poor quality homes to consumers, and leaving citizens of the commonwealth on the hook to make up for hundreds of millions in lost tax revenue.”

Juravich and his co-authors focused on residential construction in and around Worcester and Framingham, two modest-sized cities with populations of 182,000 and 68,100, respectively. “We chose this location, in part, because of the belief that innovation (and the violations that prompted them) often begin in smaller markets like this one before entering larger urban markets such as nearby Boston,” Juravich says. “In the case of construction, practices such as these emerge in these regional markets in residential construction, far away from the watchful eye of labor organizations and other regulatory bodies that tend to focus on larger cities and commercial construction projects.”

Juravich and his co-authors illustrate the tactics allegedly used by a major national homebuilder and its subcontractors, five of which were ordered to pay more than $400,000 in unpaid wages and penalties by the Commonwealth of Massachusetts’ Attorney General’s office for wage theft violations in the state. The researchers say documentation shows that while the homebuilder financially benefited from this wage theft, the company was legally insulated from being charged with any wrongdoing and few of these wages and fines were ever collected, as many of its subcontractors simply closed their doors or reopened under new names.

They also highlight regional drywall firms that they say have a long history of illegal misclassification and wage theft in New England, demonstrating how easy it is to reorganize and resume operations under new names in order to avoid prosecution and to continue these practices.

“Because no existing mechanism prevents such firms from avoiding prosecution, we have seen an explosion of firms that employ illegal misclassification and wage theft in the drywall industry,” Juravich says. “This phenomenon deeply threatens the economic viability of legitimate contractors who play by the rules. Perhaps more troubling is that the growth of these companies who make their profits from illegal employment practices has begun to move beyond residential construction into more commercial and public types of construction.”

The paper suggests a number of policy recommendations for Massachusetts to combat illegal misclassification and wage theft, including strict enforcement of penalties and fines, public identification of violators, better permanent inter-agency coordination and a dramatic increase in workplace raids.

“We have seen how woefully inadequate the regulatory structure has been and watched the emergence of a whole new production regime in residential construction built upon a foundation wage theft,” Juravich says. “Without concerted change, these new methods of production will both intensify and spread to other forms of construction victimizing largely immigrant workers in the industry. The quality of construction will continue to decline delivering a poor value to homeowners while leaving the taxpayer on the hook to cover lost revenue and the medical cost of those not covered by workers’ compensation.”

Ultimately, however, the authors state that the real solution to the crisis lies with immigration reform.

“The single, most important policy action to combat wage theft and misclassification is genuine immigration reform,” they conclude in the paper. “Without real immigration reform that will provide a path to citizenship for the more than 10 million undocumented workers in the United States, it will be difficult to control forced misclassification of work and the theft of workers’ wages. As long as immigrants remain hidden in the shadows and largely excluded from regularized employment, unscrupulous employers will continue to exploit their vulnerability to increase their own profit.”





Union proves worth to nonunion carpenters again Posted by on

Union representatives recently go together with more than 15 carpenters who were employed by J&V Construction to collect checks for back wages. Each of the men was issued a check for between $20,000-24,000.

The union had spoken to the men when they were working at UConn, building the new basketball training center earlier this year. After learning they were owed significant money from their employer, they encouraged and helped them file wage claims with the state.

For the individual carpenters, the checks represent a big win; significant money they had earned, but thought they'd never get. For the union and the rest of the industry, the checks are another reminder that knowing your rights and standing together to protect them is a worthwhile venture. Congratulations to these carpenters and the union representatives who helped them get justice.





More cheaters caught in CT Posted by on

The Connecticut Department of Labor has issued six "Stop Work" orders so far this week, two on a Stamford project and three more at an Apple store in West Hartford. All six were the result of subcontractors not having legally required workers' compensation insurance coverage in place.

Shane Gordon Drywall, of Stamford, Marcelo Drywall of Bridgeport and Arco Steel Company, of West Caldwell, New Jersey were each hit with the orders yesterday at 66 Summer Street in Stamford. The companies were working for Trinity Financial on Phase 2 of the Park Square West project, which includes 194 residential units.

Some workers on the project recently reported to union representatives that they were employed by Intext, a company that was already caught for misclassifying workers as independent contractors in April at UConn.

In West Hartford, three subcontractors identified in press reports only as being from out of state were issued stop work orders while working for California-based general contractor Dickinson Cameron. Gary Pechie, head of the Wage and Workplace Standards Division of the Department of Labor reported that contractors had ignored the orders and continued work. He has issued $1,000-a-day fines and scheduled a meeting with Apple officials.
 





Carpenters support event for low wage workers Posted by on

In the last year, fast food workers across the country have been building a campaign to raise wages in their industry. The campaign has given energy to efforts to raise the minimum wage nationally and in states and communities across America. But the fast food industry isn't the only one where massive profits are generated and an unreasonable gulf exists between the compensation given to employees in corporate offices and those on the front lines.

From health care to hospitality and construction to customer service, too many workers are being paid too little for working so hard. In Massachusetts, an upcoming event aims to elevate their cause.

The New England Regional Council of Carpenters is joining individuals in Boston and Springfield on June 12 to support low wage workers. Hosted by Massachusetts Jobs with Justice, the Low Wage Worker Day of Action will bring information and focus attention on people who work hard and still struggle to support themselves and their families. More than that, it will encourage workers to begin standing together and acting together in a way that will make a difference.

The event matches the efforts of the Carpenters union who monitor nonunion construction sites and build relationships with nonunion carpenters. All too often, nonunion carpenters are not provided the wages and benefits they deserve, given the level of skill required and risk present on today's construction sites.

In Boston, the event will be held at Copley Square, in Springfield it will be at the Mount Calvary Church at John Street and Plainfield Street (Rt 20A). Both events will take place from 4-6 pm. Union carpenters, friends and families are invited and encouraged to participate.





CT DOL issues 3 "Stop Work" orders Posted by on

The Connecticut Labor Department has issued “Stop Work” orders against three construction companies at a shopping center construction site at 230 Industrial Park in Old Saybrook, for failing to provide the required state workers’ compensation coverage or unemployment coverage for their employees.

Two contractors, Alvin Quality Masonry LLC and Industrial Technical Services Inc. were issued “Stop Work” orders after inspectors from the Wage and Workplace Standards Division determined that the contractors, working on the Big Y supermarket project, did not have workers’ compensation or unemployment insurance coverage for employees. G&F Group LLC was issued a stop work order on the Kohl’s building project for failure to have workers’ compensation or unemployment insurance coverage and for misclassifying its employees as independent contractors.

“Stop Work” orders result in the halting of all activity at a cited company’s worksite, as well as a $300 civil penalty for each day the company does not carry workers’ compensation coverage as required by law.

The New Haven Register, The Day, The Bristol Press,  Insurance News Net and Shoreline Times reported on the story.

To view a PDF of these articles, click here.





Multi-million dollar tax giveaway in Fitchburg under scrutiny Posted by on

The Carpenters union is calling on local and state officials to rescind tax breaks given to a company for a project on which they and seven others had already been ordered by state investigators to stop work for legal violations. The violations were found less than three months before the tax package was announced. Further evidence gathered by investigators, which should have triggered an investigation for tax fraud, was apparently ignored.

In December, Great Wolf Lodge and others were ordered to stop work on their Fitchburg project by the Department of Industrial Accidents after a site visit revealed they did not have workers' compensation policies in place for construction workers. One of the employers told investigators at the time that “he had four employees on site who are being paid in cash, they receive their direction and control from Mr. Viveiros, all tools and equipment belong to him.” Two weeks later, an Organizer for the New England Regional Council of Carpenters visited the site and found the same employment conditions for other contractors on site.

In March, the state announced approval of a group of tax break packages, including $17.2 million for the Great Wolf Lodge. Mark Erlich, Executive Secretary-Treasurer of the New England Regional Council of Carpenters sent a letter of concern to Greg Bialecki, Secretary of the Executive Office of Housing and Development, which approved the tax breaks.

"The lack of oversight on a project involving $17 million in tax relief should be a matter of grave concern to the Patrick administration. The violations were committed before the tax relief was awarded. That relief should be rescinded," said Erlich in the letter. "Without any further action on Great Wolf, the Commonwealth is sending an unfortunate message to its taxpayers and legitimate contractors that recipients of tax relief are rewarded regardless of illegal business practices."

"Great Wolf promised in its application that it would not knowingly hire subcontractors or other third parties that did not have Massachusetts workers' compensation insurance. Great Wolf's Senior Director of Design and Construction acknowledged the "Stop Work" order to a newspaper."

Misclassification of workers as “independent contractors” is an illegal, but unfortunately common model used in the construction industry to provide unscrupulous contractors with a significant advantage in a highly competitive industry. Misclassification costs the state and federal government hundreds of millions of dollars in lost revenue and strips workers of important workplace protection, as well as the right to unemployment and retirement benefits.

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Summary List of Stop Work Orders
1. Great Lake Services dba Great Wolf Lodge of New England (WI)
2. Colonial Tile and Flooring (Clinton, MA)
3. Timothy Michael Locklear (NC)
4. Villnave Construction Services (VCS) (NY)
5. Wisconsin Exteriors & Drywall (WI)
6. Butters Fetting Co. (WI)
7. States Drywall (WI)
8. Weber Group (IN)





Everett mayor finds out for himself Posted by on

An unhappy Everett Mayor Carlo DeMaria has a few questions for Fairfield Residential after an in-person visit to a project in the city. Fairfield is converting the old Charleston Chew factory into luxury apartments. The project has been touted as a producer of quality housing stock, but also good employment for Everett-area workers.

 When DeMaria spoke with a couple of carpenters on the project, they told the mayor they were being paid in cash on a piece-work basis and weren't getting any benefits. They were working for Wendy's Drywall, a subcontractor to VPS Drywall, a subcontractor to Metric Construction, the general contractor for one of the buildings on the project. Metric has had issues in the past with hiring subcontractors who don't meet area standards.

VPS continues a bad history. The company was ordered by the Massachusetts Attorney General to pay workers more than $4,000 in wages due to prevailing wage violations on the controversial Hannover High School project. They were also hit with more than $3,700 in fines by OSHA for safety violations, including one the agency deemed a "serious" violation. Finally, they were investigated by the United States Department of Labor for failing to pay workers more than $40,000 in overtime wages. They agreed to pay $17,500.

Carpenter Ramon Ochoa with Mayor DeMaria, NERCC Organizer Mario Mejia, Local 218 Business Agent Richard Pedi and Carpenter Moises Urias.

 Fairfield Residential is national builder and manager of multi-family housing that claims to be a leader in their industry. They claim they often work as their own general contractor and can effectively manage designs, budgets and time-lines.

 DeMaria was not happy to hear workers talk about being treated this way in his hometown and committed to following up to see that things were changed and didn't happen again.

An adjacent building, being built by union wood framers is progressing without incident.

 





At a Senate subcommittee hearing yesterday... Posted by on

“The damage was so bad they had to take bones from my wrist and hip,” Anderson testified Tuesday before a Senate labor subcommittee. “And the doctors also needed to take bones from a cadaver to do the reconstruction.”

Because he was an independent contractor, Anderson was unable to collect workers compensation. He had become an independent contractor, he said, because his employer, Dave & Marty Inc. of Michigan, had said it was the only way he’d be able to continue working with the company."

Read more here

Click here to watch a carpenter and a contractor testify at the hearing. 





Enforcement against cheating businesses jumps in Mass Posted by on

More than $21 million has been collected from employers in Massachusetts who violated labor laws in the last 18 months, according to the annual report of the Joint Enforcement Task Force on the Underground Economy and Employee Misclassification. The amount represents more than the total that was recovered in all previous years.

The joint task force was created in 2008 and was a welcome development to union carpenters and others who had been working to bring attention to the issue of misclassification. Tens of millions of dollars in state and federal revenue are lost each year due to employee misclassification while employers who play by the rules are put at a competitive disadvantage and workers are stripped of essential protections such as workers' compensation coverage and eligibility for unemployment insurance, Social Security and Medicare.

The issue is especially acute in the construction industry, where the fairness of direct competitive bidding can easily be undermined by a bidder misclassifying employees as independent contractors to save 20-30% on labor cost. Perhaps the largest recent case involved more than $1.1 million in unreported wages found at the renovation of the Boston Marriott Copley Place, where one contractor was paying $4 an hour to employees who were recruited from a substance abuse program in Connecticut. Contractors were issued more than $100,000 in fines on the project.

"The work of the Task Force is invaluable in reducing the growth of the underground economy in the state's construction industry," said Mark Erlich, Executive Secretary-Treasurer of the New England Regional Council of Carpenters. "Taking on the illegal practices of wage theft, misclassification and tax and insurance fraud creates a more level playing field, which ultimately benefits legitimate employers, tradesmen and women and taxpayers."

The joint task force brings together various state agencies, including the Executive Office of Labor and Workforce Development, the Attorney General's Fair Labor Division, the Insurance Fraud Bureau and others.

Both the Boston Globe and the Boston Herald covered the issue.
 





Enforcement against cheating businesses jumps in Mass Posted by on

More than $21 million has been collected from employers in Massachusetts who violated labor laws in the last 18 months, according to the annual report of the Joint Enforcement Task Force on the Underground Economy and Employee Misclassification. The amount represents more than the total that was recovered in all previous years.

The joint task force was created in 2008 as a result efforts by the Carpenters union and others to educate Governor Deval Patrick, state legislators and leaders of several executive branch agencies who enforce laws and policies related to employee misclassification. Tens of millions of dollars in state and federal revenue are lost each year due to employee misclassification while employers who play by the rules are put at a competitive disadvantage and workers are stripped of essential protections such as workers' compensation coverage and eligibility for unemployment insurance, Social Security and Medicare.

The issue is especially acute in the construction industry, where the fairness of direct competitive bidding can easily be undermined by a bidder misclassifying employees as independent contractors to save 20-30% on labor cost. Perhaps the largest recent case involved more than $1.1 million in unreported wages found at the renovation of the Boston Marriot Copley Place, where one contractor was paying $4 an hour to employees who were recruited from a substance abuse program in Connecticut. Contractors were issued more than $100,000 in fines on the project.

"The work of the Task Force is invaluable in reducing the growth of the underground economy in the state's construction industry,” said Mark Erlich, Executive Secretary-Treasurer of the New England Regional Council of Carpenters. “Taking on the illegal practices of wage theft, misclassification and tax and insurance fraud creates a more level playing field, which ultimately benefits legitimate employers, tradesmen and women and taxpayers."

The joint task force brings together various state agencies, including the Executive Office of Labor and Workforce Development, the Attorney General’s Fair Labor Division, the Insurance Fraud Bureau and others.

Both the Boston Globe and the Boston Herald covered the issue.





Raids flush out more crooked contractors in Connecticut Posted by on

A series of sweeps of construction sites in Connecticut this year has resulted in 27 "Stop Work" orders against contractors for misclassification of workers as "independent contractors." The results continue a disturbing trend in the state's construction industry. In the past year, the Connecticut Department of Labor reports that inspection and review of 108 construction projects and 299 contractors has resulted in 199 "Stop Work" work orders, an alarming rate of cheating.

"Some employers will misclassify workers as independent contractors with the intent of avoiding their obligations under federal and state employment law covering such matters as workers' compensation, unemployment taxes and payroll reporting," said state Labor Commissioner Sharon Palmer. "Unfortunately, when an employer fails to pay for the proper coverage for injuries suffered on the job, and a worker gets hurt, the state's taxpayers ultimately foot the bill."

Avoiding tax obligations gives cheating employers a significant advantage in competitive bidding and negotiated pricing within the construction industry and creates a funding gap for state and federal governments, among other problems.

Media coverage here.





State, Feds raid Stamford mega-sites Posted by on

The Connecticut Department of Labor was joined by the US Department of Labor, OSHA and local and state police in raids of at least four construction sites in Stamford last week in an unprecedented effort to crack down on payroll fraud. The Stamford Advocate covered the raids and published a column by Angela Carella calling for developers to clean up their businesses.

The raids targeted three sites being built by Building and Land Technology and another by Greenfield Partners. The sites have all previously been the target of numerous public complaints as well as demonstrations by union carpenters and other trades workers. The Harbor Point project being built by BL&T has also been the site of numerious enforcement actions. More than 34 "Stop Work" orders had been issued at the project prior to last week's raids.

Investigators talked to more than 200 workers, according to media reports, and will sort out possible violations in the coming weeks after reviewing those interviews.
 





Contractor: Being union is beneficial to all Posted by on

David Rampone, President of Hart Engineering, a signatory contractor based in Cumberland, Rhode Island isn't shy about being a union contractor. Last year he volunteered to be one of the latest union contractors to do a radio ad on behalf of the New England Regional Council of Carpenters. Now, he's published an opinion piece in the Providence Journal explaining why his business is better with a union partnership. Click through to read it.

The following opinion piece appeared in the January 10 print edition of the Providence Journal-Bulletin.

The benefits of employing unionists

DAVID RAMPONE

Regarding Charles Chieppo’s Dec. 20 column, “Unions are 1 percenters in Mass.,” in which he portrayed the construction industry inaccurately:

As the chief executive of a major Rhode lsland construction firm that does work all over New England, I’ll set the record straight. I am the president of Hart Engineering Corp., a general and process mechanical contractor founded over 70 years ago and based in Cumberland.

While I have read several opinion pieces by “public-relations experts” articulating the “evils” of the unionized construction industry, it needs to be pointed out that these experts have no actual experience in the construction industry and draw their conclusions based purely on anecdotal information provided by those who wish to see the unionized construction industry fail.

For the record, the National Labor Relations Act lets construction companies decide for themselves whether to be affiliated with the industry’s trade unions. It is the only industry that has such a provision. Since its inception, our firm has made the business-driven decision to be affiliated with several trade unions — a decision that has been beneficial to both our company and employees.

Currently we employ more than100 union tradesmen and women on dozens of jobs, large and small, throughout New England. These employees receive a fair wage, full health-care benefits and pension contributions — a package that lets them provide their families with a respectable standard of living. And in light of the negative attention cast on public-sector unions in these times, note that unionized construction workers are not guaranteed employment. In fact, Rhode Island unionized construction workers average about 1,500 hours worked a year. They do not receive vacation time, sick days or holiday pay, nor do they receive any benefits if they do not work the required number of hours a year — usually between 1,200 and 1,400, depending on the trade union involved.

Beyond my own company, the performance of Rhode Island’s trade unions and union contractors speaks for itself. There are more than 200 local contractors with union agreements in the Rhode Island area, and there have been more than 50 all-union project labor agreements (PLAs) worth billions of dollars completed in this area, including most of the state’s highest-profile projects. Most of these PLAs have been in the private sector.

These agreements symbolize the marketplace at work. Owners, construction managers and contractors enter into these agreements for one reason only: It is in their best interest to do so. And why? The trade unions in partnership with their contractors invest millions of dollars annually recruiting, training and retraining their workers to provide the safest, most skilled workforce in our industry. In today’s world, owners want their projects completed safely, on time, under budget and to the highest level of quality possible. That is why owners from small firms to Fortune 500 companies enter into project labor agreements.

While there are far fewer PLAs in the public sector than in the private sector, they are becoming more prevalent. However, before any public entity in Rhode Island can implement a PLA, it must complete an independent “objective and reasoned” study that recommends their use.

The trade unions’ record of providing contractors and owners with a safe and productive workforce is unmatched in our industry. Those who oppose them assert that using nonunionized workers would provide the owner with great savings. Unfortunately, those savings are usually the result of substandard wages, failure to provide health-care benefits to employees, or misclassifying employees to pay them a lower wage.

For 70 years we have provided our clients with the safest, most capable and productive work force in the industry, and our employees with a fair wage and benefits for them and their families. We are proud of what we have been able to achieve with our union partners.

David Rampone is president of Hart Engineering Corp., in Cumberland.  





Misclassification crackdown, publicity Posted by on

Misclassification has been a serious problem in the construction industry for years, and something against which the Carpenters union has led the fight locally, regionally and nationally. Union efforts resulted first in greater understanding and awareness among elected officials and now regularly lead to enforcement and publicity on the issue that is either directly a result of union action or an indirect result of efforts initiated by the union.

Two items broke this week that reinforce that point. In Worcester, Telegram and Gazette columnist Clive McFarlane wrote about efforts by NERCC Organizer Manny Gines to chase down employers who cheat by misclassifying workers as independent contractors or cheat them out of their wages.

McFarlane's column ties into an announcement earlier in the week by the Executive Office of Labor in Massachusetts that more they had found more than 2,300 workers misclassified by just three employers. Though the three companies were not involved in the construction industry, the eye-popping $11 million in unreported wages and millions of dollars the state should have received for unemployment insurance payments generated new stories that put the issue in front of the general public.





Rego uncovers potential mess at FRHA Posted by on

Local 1305 member Dan Rego, who is a NERCC Organizer and Fall River City Councilor, is shaking things up in the Southeastern Massachusetts city. A few weeks ago, he raised concerns over issues with work being done by the Fall River Housing Authority. Since then, the sparks have started flying.

Rego spoke at a Housing Authority meeting and reported on conversations he had with workers on several FRHA projects in the city, some of which were receiving federal funding. Several workers had reported being misclassified as independent contractors, not being paid the legally mandated prevailing wage or not being paid at all. Rego told the Board that he had referred all of the allegations and evidence to proper state authorities.

 The Housing Authority went into immediate executive session, during which they appointed their own independent investigator. The story quickly hit the Fall River Herald News. The paper then followed up with a vicious attack on Rego, questioning not only his motives, but actions by Rego and the union in the past to protect industry standards. This in a city where legal violations on public construction projects are not unheard of.

This week, Rego spoke out in his own defense in the paper, reminding readers that his knowledge of and experience in the construction industry are a benefit to the city and its residents.

Please take a moment to read Rego's "Letter to the Editor" and consider weighing in with a respectful comment on the Herald News site.

 





CT DOL issues 13 "Stop Work" orders Posted by on

The Connecticut Department of Labor issued “Stop Work” orders against 13 construction companies in recent weeks for misclassifying workers as “independent contractors.” The orders were issued in multiple communities where contractors were found to have misclassified workers for the purpose of avoiding their obligations to carry workers’ compensation and paying federal and state unemployment taxes, including unemployment.

One of the "Stop Work" orders was issued against NLP Contractors at the New London Plaza. Union carpenters have been protesting at the site, where renovations are being done and where North Carolina-based SandovalConstruction has already been issued a "Stop Work " order. (earlier post)

The Hartford Courant, New London Day, Republican AmericanDanbury Patch and Greenwich Patch reported on the story. Sites where contractors issued "Stop Work" orders were issued were located in Danbury, Greenwich, New London, Preston, Naugatuck and Simsbury.

“Stop Work” orders result in the halting of all activity at a cited company’s worksite, as well as a $300 civil penalty for each day the company does not carry workers’ compensation coverage as required by law.

According to a release on the "Stop Work" orders by the Department of Labor: “in the past 12 months the agency has inspected 167 construction projects and reviewed the records of 688 contractors. A total of 281 “Stop Work” orders have been issued during this time, with 116 identified as being issued to out?\of?\state contractors. Since October 2007, a total of 735 “Stop Work” orders have been issued with $285,000 collected in civil penalties for the misclassification of workers. Additionally, referrals have been made to the Department of Revenue Services and the Labor Department’s Tax Division audit unit for further investigation.”
 

This blog post was updated form a previous post on 5/16 to include links to additional media coverage and information about the New London Plaza site.





NERCC calls for harsher penalties for those not buying workers' comp Posted by on

The New England Regional Council of Carpenters and other industry groups are calling on the Massachusetts legislature to make it a felony for employers to fail to purchase workers compensation insurance for their employees. Senate Bill 915, sponsored by Senator Katherine Clark (D-Melrose) and Majority Whip Ronald Mariano (D-Quincy) also has the backing of Attorney General Martha Coakley.

Operating without workers' compesnation insurance is currently a misdemeanor, punishable by upt oa year in prison or a find of up to $1,500. The new law would make the felongy punishapble by up to five years in state prison, two-and-a-half years in jail or a fine of up to $10,000.

NERCC Political Director Steve Joyce said that although union carpenters are always covered by workers' compensation insurance, they are still hurt by those who cheat.

"In an industry where work most often goes to whoever submits the lowest price, any contractor who does not purchase workers' compensation coverage has a competitive advantage right from the start over contractors who follow the law and have coverage," he said. "That negatively impacts any carpenter that works for a legitmate contractor. We're not looking to hurt all employers, we value the role they play in creating jobs. We just want everyone to comply with the law when they do it."

Even the Associated Industries of Massachusetts (AIM), a group that lobbies for businesses, support the bill. In a story by the State House News Service, John Regan, AIM's Executive Vice President described the current situation as unfair to too many.

"Their faliure to have that insurance in place means that if workers working for them get injured, the rest of the employer commnity pays the bill" and that making failure to have coverage a felony "reflects the seriousness of the issue, and conveys how important it is that coverage be in place."

According to the SHNS story, the Massachusetts Department of Industrial Accidents has reported more than 1,000 cses costing the worekrs compensation fund $26 million in the last five years becuase their employer didn't have worers' compensation coverage. In recent years the department has routinely issued Stop Work Orders against more than 3,000 employer found to be operating without workers' compensation coverage.





Stop work orders issued at Harbor Point, media depicts industry mess Posted by on

The Connecticut Department of Labor's Wages & Workplace Standards Division, has issued "Stop Work Orders" against eight contractors working on the Harbor Point project in Stamford, continuing a string of bad practices and bad press for the city and the project's developer, Carl Kuehner's Building and Land Technology (BLT).

The Stamford Advocate has run a significant story on the orders, as well as an excellent piece detailing the Department of Labor's efforts to confront extensive problems in the construction industry. Both are well worth reading and sharing.

Avilik Inc., Flagg World, M&M Construction, Pillar Construction, T.F. Andrews, Brothers Contracting, Continental Tile and Kitchen Classics were the companies cited for various violations of wage, hour, insurance or tax laws by the Department of Labor's Stop Fraud Unit. None of the companies are based in Connecticut. Some are only as close as New York, some have come from as far away as Maryland, according to the Advocate.

Three of those companies--Brothers Contracting, Continental Tile and Kitchen Classics--are being charged with violating a previous stop work order by going back to work without clearence by the DOL.

The project has come under intense criticism in Stamford, where citizens feel the developer and oher companies based in Harbor Point has been given too much control with little or no oversight. Union carpenters have started an online petition calling for Stamford Mayor Michael Pavia to step in and give residents more of a voice. Please read and consider signing the petition here.





Pulte subs ordered to pay more than $500k Posted by on

Multiple enforcement agencies in Massachusetts today announced that five subcontractors employed by Pulte on sites in Eastern Massachusetts have been ordered to pay workers more than $400,000 in owed wages and make payments totaling $141,000 to cover unpaid taxes.

The order is the result of investigations that began after workers complained to Representatives of the New England Regional Council of Carpenters that they had been unpaid for extended periods of time. Workers went on strike at several Pulte locations and filed complaints with the state.

"The investigation fined five separate subcontractors, but the real culprit is Pulte Homes, a multi-billion dollar national homebuilder," said Mark Erlich, Executive Secretary-Treasurer of the New England Regional Council of Carpenters. "Those subs are interchangeable and were just doing Pulte's bidding. Cheating is Pulte's business model and, unfortunately, that approach is far too common in the residential construction industry."

Subcontractors that were part of the order include:
--AM Construction Services and its President, Adimar Demoura, age 32 of Framingham, allegedly failed to pay four workers a total of $15,331.50 for framing work done on private residential projects in Braintree and Plymouth. They were also fined $22,500 in penalties.
--Five Stars Construction and its President, Alexandre Miranda, age 40 of Trumbull, Connecticut, allegedly failed to pay two workers a total of $30,700 for framing work done on a private condominium project in Natick. They were also fined $30,000 in penalties.
--Nunes Brothers Construction and its President, Tiago Aguiar M. Nunes, age 28 of Brooklyn, New York, allegedly failed to pay 23 workers a total of $99,086.75 for framing work done on private condominium and single-family homes projects in Braintree, Plymouth, Natick, and Northbridge. They were also fined $112,500 in penalties.
--Seven Seas Group and its President, Jackson Croscup, age 55 of Fall River, allegedly failed to pay five workers a total of $10,333 for framing work done on a private condominium project in Natick. They were also fined $20,075 in penalties.
--Two Brothers Construction and its President, Wellington DeLima Borges, age 41 of East Natick, allegedly failed to pay six workers a total of $34,751.50 for framing work done on a private home development project in Plymouth. They were also fined $34,500 in penalties.

Investigating the complaints were Attorney General Martha Coakley’s Office (AGO), the Executive Office of Labor and Workforce Development (EOLWD), and the Joint Enforcement Task Force on the Underground Economy and Employee Misclassification (JTF). The JTF was established by Governor Deval Patrick through Executive Order #499 in March 2008 to coordinate multiple state agencies’ efforts to stamp out fraudulent employment activities by enforcing the state’s labor, licensing, and tax laws.

“All workers in the Commonwealth deserve to be paid for the wages they have earned, including their overtime,” said Attorney General Coakley. “We will continue to work together and take appropriate action to stop these unlawful business practices, level the playing field for companies and protect workers.”

“The Commonwealth is committed to insuring that all businesses carry both workers’ compensation and unemployment insurance coverage,” said Secretary of Labor and Workforce Development Joanne F. Goldstein. “We will not tolerate employers or developers who proceed without this coverage, which puts employees at risk and employers who play by the rules at a competitive disadvantage. The Joint Task Force will continue to take all necessary action to protect legitimate employers, employees and the taxpayers of the Commonwealth.”





California to attack underground economy Posted by on

Fed up with billions of dollars in lost tax revenue and a business community that is increasingly upset by being put at a competitive disadvantage, California is vowing to make a major push to crackdown on businesses that misclassify workers as independent contractors to avoid paying unemployment insurance, workers compensation coverage and other required feeds. The Los Angeles Times reports.





Troubling state of affairs in Stamford Posted by on

John Cunningham, Business Manager for Carpenters Local 210, has written an opinion piece, published in the Stamford Advocate today highlighting some very dangerous trends in the area's construction industry. A young trades worker was killed when he was blown off a roof in a very preventable accident. He and his brothers were owed more than $6,000 in wages, according to reports. Stop Work Orders issued against contractors who don't carry workers' compensation insurance for their crews or who misclassify workers to avoid payroll taxes and their share of other "safety net" programs are becoming more and more common. Major projects being done by major developers are involved.


The last few months should serve as something of a wake-up call for everyone from workers to elected officials and everyone in between. It is especially necessary that general contractors, construction managers and developers begin to pay more attention to what is actually happening on their sites.


Union carpenters have also begun to make more noise in the streets, demonstrating and asking people to pay a more attention to these very serious issues. The industry needs basic standards for how work is done and how workers are treated. Contractors who only focus on getting jobs, investors interested in only profits and elected officials interested in only ribbon cuttings and job creation statistics can not be relied on to follow through. Union carpenters intend to lead the fight.





CBS covers misclassification Posted by on

Misclassification of workers is rampant in the construction industry. If you are a union carpenter, you and your fellow Brothers and Sisters are being denied work opportunities because of this issue. It is used as a tactic by nonunion subcontractors who do it to artificially lower their bids. Union contractors--and nonunion ones that play by the rules--are put at at significant competitive disadvantage.

Click below to see a story done by CBS News about how misclassification is being used in the trucking industry. Though it is a different industry, the story gives a very clear idea of how and why employers use this kind of scheme in the construction industry.

 

 





Carpenters protest at Chelsea Piers Posted by on

Union Carpenters in the Stamford, Connecticut area turned out in force yesterday to call public attention to problems at Chelsea Piers, where a worker was blown off a 50-foot unfinished roof in October. The worker, Javier Salinas, was not wearing a harness or other safety equipment when a strong wind blew him off, causing multiple blunt force trauma, causing his death. The accident was completely and easily preventable and Salinas' death was tragic and needless.

AP Construction hired American Building Group, for whom Salinas and two of his brothers were working. Following the accident, American Building Group and two other subcontractors on the site were issued "Stop Work Orders" for misclassifying workers as independent contractors or nonpayment of wages. American Buidling Group promised to make a donation for Salinas' funeral, but reneged.Sadly, two of the workers owed money were Javier Salinas' brothers, who were owed more than $6,000.They wre going to use that money to provide a decent burial for Javier.

The Stamford Advocate covered the protest, quoting union members.

Chris Bachant, a union carpenter from Waterford, stood near the McDonald's parking lot and held a large sign addressed to AP Construction that questioned whether the company "manages" profits or safety.

"It doesn't matter to me whether someone is non-union or union," he said. "I don't want to see someone get hurt."

Ted Duarte, a union organizer at the New England Regional Council of Carpenters, said the unethical and illegal methods used by some contractors to shave operating costs end up hurting licensed, unionized construction workers, who must undergo safety training and keep up their certifications. The practices undercut local contractors, he said.

"If you play by the rules, you're not playing on a level playing field," Duarte said.





Court: Universal Drywall misclassified, owes $300k to insurance company Posted by on

A Massachusetts Superior Court judge has found that Universal Drywall routinely misclassified carpenters as so-called independent contractors and failed to properly purchase workers compensation coverage. The practice meant that its insurance carrier, Travelers Property Casualty Company of America was defrauded out of more than $327,000 in premiums.

The decision brings to an end a case involving work that Universal Drywall performed on some Massachusetts sites, including Brooksby Village in Peabody, Linden Ponds in Hingham, Sherburne Commons in Nantucket and Arbor Point in Burlington. It did not cover work that Universal--an Auburn, New Hampshire-based company--performed in other New England states or at other times in Massachusetts.

Universal Drywall, which is owned and run by Richard Pelletier and Real Tanguay, is well known to the New England Regional Council of Carpenters. The union has spoken to carpenters on many sites in the region who have told they were classified as "1099s." The company attempted to protect itself from misclassification enforcement by having carpenters sign "contracts," but the court found that the company's extensive control and direction of the workers and their work meant they were employees and premiums for workers compensation were owed to Travelers.