Settlement in Prevailing Wage Case

In recent news, 103 California construction workers received $7,228 each after a Long Beach labor commissioner learned that San Diego subcontractor, Champion Construction was committing prevailing wage fraud. Their general contractor, TB Penick & Sons, were also held liable. The guilty parties settled 1.1 million.

According to California Department of Industrial Relations, employers must pay public works employees, such as the construction workers in this case, the prevailing wage, or hourly wage including overtime and benefits. Prevailing wage is important because it keeps everyone, workers as well as contractors on even ground. Prevailing wage laws keep contractors from cutting corners on labor costs. As a worker, you know that your employer will pay you the same wage as another worker doing the same job in the same area.

This wage differs depending on location and type of job that subcontractors hire employees to do. Over the course of six months, the subcontractor falsified hourly wage and benefits records of their employees.

“This case clearly demonstrates that general contractors who select contractors that don’t play by the rules will pay a heavy price,” said Julie A. Su, California’s labor commissioner on the case. “Under the law, they are responsible for the wage theft of their subcontractors.”

Cases such as these are difficult to prove, because there are strict rules on how you are allowed to report wage theft. These rules are there to protect employers from false accusations, but make it much harder for employees to make a case. There are a few ways to blow the whistle on a possible violation of the prevailing wage. In this case, the Labor Commissions Office learned of the act after:

• Initial report came from Carpenters Contractors Cooperation Committee
• Interviews with over 30 employees
• Site visit
• Audit of financial records

What is wage theft?

In its most basic sense, wage theft means that employers are not paying employees for the work they are doing. This could include regular pay, overtime, or benefits that you are supposed to receive.

Is your employer committing wage theft?

If you are unaware of the rights that you hold as an employee in the state of California, it may be easy for employers to get away with paying you less than you deserve. Some ways that you can recognize wage theft in your workplace include:

• Not receiving your rest and/or meal breaks. California law states that workers are entitled to paid 10-minute rest breaks every four hours, as well as a 30-minute meal break if you work for more than 5 hours. If you work a typical 8-hour day, it is against the law if you do not receive a lunch break and two rest breaks.
• Your employee tells you to clock out, but requests that you continue working. Under (Fair Labor Standards Act) FLSA law, your employer must pay you for all hours worked.
• The paychecks you are receiving bounce repeatedly. A company is liable to pay extra if they are not paying you on time. It may be wise to start a paper trail of your finances if your checks are never coming through.
• Your employer pays you minimum wage instead of prevailing wage. There is a difference between minimum and prevailing wages. The former typically refers to the lowest monetary value that an employer can pay an employee, which differs from state to state.
• You are not receiving your tips. Tips belong solely to the employee. It is against the law if your employer is withholding tips that you earned. However, it is legal for an employer to divide tips equally among all employees.

If you are concerned that your employer has been cheating on prevailing wage laws, overtime pay or other rights under the FLSA, talk to an attorney at our firm today.