- The U.S. District Court for the Middle District of Tennessee, as part of a settlement, has ordered contractor Reynolds Baldwin III — doing business as Copperhead Construction LLC and Sara-Tech LLC — to pay $531,000 of back wages, liquidated damages and civil penalties for violations involving 82 employees under the Fair Labor Standards Act (FLSA).
- The court’s action came after a U.S. Department of Labor Wage and Hour Division investigation of the Spring Hill, Tennessee, contractor. The division determined that Baldwin did not pay his employees overtime when they worked more than 40 hours, altered time cards to make it appear employees worked fewer hours than they did, failed to maintain the required work-hour records, and did not display the mandated FLSA posters in the workplace. In addition to the financial portion of the settlement, the court enjoined Baldwin and his companies from committing future FLSA violations.
- "The [division] will use all of the tools at its disposal to ensure workers receive the wages they have legally earned," Nettie Lewis, the Wage and Hour Division’s Nashville district director, said in a statement. "This case should remind all employers to ensure their pay practices follow the law."
The vast majority of construction firms pay their employees what they’re owed, but there doesn’t seem to be a shortage of contractors who cheat their workers, be it to "save" an over-budget job or just out of plain greed. In an environment where the labor pool is so tight, it’s all the more baffling that any construction company would treat its employees this way.
In an effort to lessen the problem of underpayment of wages, the Pittsburgh City Council at the end of 2018 established the Joint Task Force on Construction Industry Fraud, which will target contractors that pay their employees wages below mandated levels, and, as a result, underpay their taxes.
Other jurisdictions are pursuing wage violators as well. In October, Massachusetts Attorney General Maura Healey announced that her office fined Leominster, Massachusetts, contractor Force Corp. and its executives $837,341 for wage violations, including: taking illegal deductions from their paychecks for tools, safety equipment and disciplinary measures; not paying overtime; and failing to pay prevailing wages.
Meanwhile, Colorado Gov. John Hickenlooper last summer announced the creation of a state task force to make it more difficult for construction companies to misclassify construction-industry employees as independent contractors, which also leads to nonpayment of payroll taxes, unemployment tax and workers' compensation insurance premiums.