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Protest Highlights Classification Issue

25 October, 2022

The ongoing dispute over classifying workers as employees or subcontractors continues. Recently a protest in Baton Rouge, Louisiana, accused a commercial paint contractor of paying painters and other workers below what is required by law. This was after the Department of Labor found the company in violation on a previous project and slapped it, along with another construction company, with more than a $246,000 fine to cover back wages.

In late September, according to an article by Anthony McAuley published on www.nola.com, representatives of several trades — painters, electricians, and other construction workers, along with a community organization called Unión Migrante, gathered at a local college prep school — the site of one of the company’s current renovation projects — to call attention to these conditions and claiming that the painting contractor is continuing the same pay practices that the DOL previously found in violation.

The president of the painting company denied the allegations, stating that the workers on the current site were not employed or contracted by them, but by another firm altogether. The contractor stated that their contract is with the other firm, and they expect that firm is paying the workers according to legal requirements.

The DOL stated that it has no open case against the contractor, which, in their view, paid the back wages owed on the previous projects and is in the clear.


Background
The U.S. Department of Labor found that the wages of hundreds of painters and drywall workers employed by the contractor on construction projects, including work at New Orleans’ Superdome, were in violation of the law when their employer misclassified the workers as independent contractors. According to the DOL, the workers were denied overtime pay, and the employers failed to keep accurate records of hours worked.
 Of the $246,570 in overtime back wages owed to 306 employees on the Superdome project, the painting contractor paid $199,342 to 243 employees for which the division found it jointly liable along with the construction firm.

“Too often we find workers denied wage protections such as the right to overtime pay and other benefits – including unemployment insurance, workers’ compensation and health insurance – by employers who misclassify them as independent contractors,” said Wage and Hour District Director Troy Mouton in New Orleans. “Our investigation shows the costly consequences employers face when they or their subcontractors fail to comply with the law. When we determine a joint employment relationship exists, the Wage and Hour Division will hold all responsible employers accountable for the violations.”

Increased federal scrutiny on wage theft
An article on SkillSmart reported that wage theft is particularly prevalent in the construction industry, and that the federal government is paying more attention to the issue than in years past. New laws, the article states, have changed the game regarding who is responsible for making sure employees are paid correctly, so it’s important for any contractor to know their legal responsibilities and obligations before partnering on a project with other contractors. “All contractors [in some states] are now responsible for making sure that every worker, for each of their subcontractors, is paid the correct, timely wage,” the article reported.

Highlighting a widespread issue
According to McAuley’s article, a member of the local painters’ union said the protest of this particular contractor was also meant to highlight what he called a “widespread ploy” of misclassifying workers in order to underpay laborers and avoid paying taxes. He wanted to make sure that workers knew their rights under the laws, so that employers wouldn’t cheat them out of wages and benefits in order to pocket more money themselves. McAuley adds that there have been other instances of this happening in Louisiana and that the DOL has stated about 13,000 workers are currently underpaid and deprived of benefits.

An organizer at Unión Migrante, the article continued, said that due to their status, immigrant workers are often intimidated into staying silent, continuing that she believed immigrations status and fair pay should be treated separately, and that employers should follow the labor laws without worker organizations having to leverage the continuing threat of federal investigation.

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