Posts Tagged ‘Public Works Contractors’

Referring to the failure to comply with prevailing wage requirements as “wage theft,” the California Labor Commissioner recently cracked down on two public works construction contractors for their alleged failure to comply with California’s prevailing wage laws by  assessing wage and penalty assessments in excess of $1 million dollars.

The employers were cited for some of the following violations: (1) unlawfully charging fees for fringe benefits; (2) intentionally paying workers less than the prevailing wage for work performed on the project; (3) failing to pay daily overtime; (4) failing to make employer payments to a benefit program; (5) failing to pay Saturday and Sunday premium rates; and (6) failing to pay into a state-approved training program for the California Apprenticeship Counsel.

One of the construction contractors cited for violations claims that it hired a prevailing wage consulting company to ensure that it met all regulations and properly trained its staff to comply with prevailing wage rates and fringe benefits.  This company believes that it has the back-up to prove that the fine is inaccurate and that it can demonstrate why its payroll records are correct.

Lesson for Contractors:  Employers should strive to ensure that they are fully complying with their state’s prevailing wage laws.  The attorneys at Harmon & Davies are here to assist Pennsylvania employers with prevailing wage compliance issues.


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.

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Under the Pennsylvania Public Works Employment Verification Act (“the Act”), a new law that takes effect on January 1, 2013, public works contractors and subcontractors working on projects (funded at least in part by a public body) with an estimated value of $25,000 or more, will be required to enroll and participate in the federal E-Verify electronic employment eligibility verification system (“E-Verify”).  E-Verify is an internet based system that confirms the legal work authorization status of newly hired employees by comparing information on the employee’s Form I-9 with records on file with the U.S. Department of Homeland Security and Social Security Administration.  Specifically, as a precondition to being awarded a public works contract, the Act mandates that before the execution of the contract, the contractor and its subcontractors provide the contracting agency with a Verification Form, certifying the contractor’s and subcontractor’s compliance with the E-Verify requirement.    

Contractual Language.   The Act also requires that contracts between a public works contractor and its subcontractors contain information regarding the requirements of the Act.  Thus, it is highly recommended that Public Works contractors revise theirs subcontracts before January 1, 2013 to comply with the Act.    

Enforcement of the Act.  To ensure compliance with the Act, the Department of General Services has been granted the authority to conduct random and complaint-based project audits.  The penalties for failing to comply with the Act include monetary fines and debarment from public work. 

Good Faith Defense.  Notably, the Act contains a “Good Faith” defense clause that shields employers from liability if the employer takes adverse action against a newly hired employee in reliance on an E-Verify determination that the individual is not authorized for employment. 

The attorneys at Harmon & Davies are available to assist public contractors with revising their subcontractors to comply with the Act. 

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