A New York City contractor recently agreed to pay nearly $1 million dollars to settle a prevailing wage investigation into complaints that one of its subcontractors on a public housing project underpaid 31 masonry workers and bricklayers. The contractor also agreed to pay $100,000 in back wages to four of its laborers, plus $50,000 in costs and fees to the state.
The New York Attorney General’s prevailing wage investigation revealed that for over a year, the contractor’s subcontractor paid masonry workers and bricklayers between $16 to $22 dollars per hour, with no overtime premium, for work that should have been paid at a prevailing wage rate of between $53.55 to $72.44, plus supplemental benefits. The investigation further revealed two instances where the contractor failed to classify or list employees in its certified wage payroll reports and two other instances where employees were misclassified at pay rates below what they should have been paid.
The New York Attorney General’s office said that in addition to requiring government contractors to pay wages and benefits comparable to local norms for a given trade, federal and state prevailing wage laws also hold general contractors responsible for underpayments by their subcontractors.
The settlement mandated that the contractor’s contracts with any subcontractor on public or private construction projects state that compliance with labor laws is a material term of the contract and that the subcontractor may be terminated if it does not fix labor law violations brought to its attention.
According to New York’s Attorney General, his office will hold contractors accountable for their prevailing wage violations and for their lax oversight of subcontractor’s practices.
Lesson: Contractors need to pay attention to their subcontractor’s payment practices.
This article is authored by attorney Shannon O. Young and is intended for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice. Any particular questions should be directed to your legal counsel or, if you do not have one, please feel free to contact us.
