PAGE 4 | April 19, 2019 | NORTHWEST LABOR PRESS
Wage theft is tax fraud too
Painters organizer Roman Ramos (right) told commissioners how workers were cheated on a prevailing wage project.
IBEW Local 48 apprentice Jemima Menkhus and Blue Green Alliance director Ranfis Villatoro also testified.
Multnomah County takes on wage theft
The county could soon draft union
reps to help with enforcement.
A proposed pilot program could
make Multnomah County a
trailblazer in fighting wage theft
in construction. To make the
case for it, a panel of union
members and advocates ad-
dressed the County Commission
April 9 about the many ways
unscrupulous contractors cheat
workers out of wages — and
why the complaint-driven
process at Oregon’s under-
staffed Bureau of Labor and In-
dustries isn’t enough to stop it.
Wage theft is the underpay-
ment or nonpayment of wages
or benefits that workers are
legally entitled to receive. It’s
not uncommon in construction
— even on taxpayer-funded
public construction projects that
employ compliance staff to
guard against it. Those staff
need help, several union repre-
sentatives told commissioners.
And they’d get that help un-
der the proposal put forward by
Multnomah County Chair Deb-
orah Kafoury’s office. As de-
tailed in a budget memo, the pro-
posed Labor Compliance Pilot
Program would allow knowl-
edgeable members of the public,
such as union representatives, to
volunteer to help enforce pre-
vailing wage and wage and hour
laws on County construction
projects. The volunteers would
have access to the certified pay-
roll records that contractors sub-
mit to the County — and be al-
lowed to visit worksites to
interview workers.
Modeled on a program at Los
Angeles Unified School Dis-
trict, the pilot project would as-
sign a half-time-equivalent staff
person to train and support 10
volunteers who would visit the
County’s construction projects.
Often, workers don’t know
their rights, or they fear losing
their job if they complain.
“Wage theft is out of control
around the city,” said tile setter
Matteo Russo of Bricklayers
Local 1.
Carpenters union organizer
Marcus Rodriguez told commis-
sioners within his union, wage
theft is most prevalent among
drywall hangers and wood
framers. Just last month, Wood-
burn-based LG Contractors paid
$99,258 to 34 workers to settle
charges that they were paid as
laborers for carpenter work they
did on a 2017 building project at
Clackamas Community Col-
lege.
“It’s tough to win bids against
competition that has no inten-
tion of playing by the rules, no
intention of paying their em-
ployees,” said Jerry Henderson,
executive director of the Oregon
chapter of SMACNA (Sheet
Metal and Air Conditioning
Contractors National Associa-
tion.)
After the presentation, com-
missioners spoke roundly in fa-
vor of the program.
The project is slated to be in-
troduced April 25 as part of the
County chair’s budget proposal,
which the board is expected to
vote on May 30.
—Don McIntosh
Thirteen ways to cheat your employees out of wages
Wage theft is far too common in construction.
Here are some ways crooked contractors do it.
Don’t pay them. Hire a day laborer for a day’s work, then stiff
them when the work is done.
Don’t pay for breaks. Tell them the company’s in too big a hurry
for them to take meal and rest breaks.
Don’t pay them overtime. You can’t afford time-and-a-half.
Tell them they’re independent contractors.That gets you
out of paying employer Social Security tax, unemployment
insurance, workers’ comp, and maybe even minimum wage.
Don’t pay them for time in transit. Tell them to pick up the
company truck and equipment and drive 50 miles to the work
site, but pay them only for the hours they work on site.
Call them apprentices. Pay your journeymen the apprentice wage.
Work them off-the-clock. Ask them to do a little prep work
before they clock in, or a little cleanup after they clock out.
Ask for kickbacks.You gave them the prevailing wage job, didn’t
you? Have them pay some of those higher wages back to you,
or to the foreman, or labor broker.
Pay piece rate. So what if it ends up less than minimum wage?
Deduct things from their wages. Why should you pay for the
tools or supplies they need to do the job?
Misclassify them. On a prevailing wage job, pay them at the
laborer rate while they do carpenter or painter work.
Leave off benefits. Prevailing wage includes money for benefits,
but who can afford to offer them?
Lie about the number of hours they work. Pay the prevailing
wage. Just tell the project superintendent that your employees
worked half as many hours as they really did.
Pacific Northwest
Regional Council of
Carpenters held
demonstrations in
Portland (left) and
four other Pacific
Northwest cities
April 15. The mes-
sage: When corrupt
construction con-
tractors cheat work-
ers of wages,
they’re also dodg-
ing state and fed-
eral income taxes.
Nationally, it’s esti-
mated that as many
as 1.2 million con-
struction workers
are being paid off
the books, while an-
other 300,000 are
being misclassified
as independent
contractors.