Painting Company Cited in Wage Theft Investigation
16 March, 2023
A painting contractor that does business in a four-state area has agreed to pay $3.68 million to workers that, a court ruled, it failed to compensate for overtime. According to an article in the Engineering News-Record (enr.com), the company owed back pay for overtime wages to 593 employees, as it paid straight time for overtime worked and then falsified payroll records to hide its activity. In order to avoid the overtime rates, the employer created pay stubs showing less than the actual hourly rate.
The action follows a five month investigation by the department’s Wage and Hour Division that found that along with the falsified pay records to avoid paying overtime, it then intimidated workers who questioned the company’s pay practices. These are all violations of the Fair Labor Standards Act.
The Labor Department investigators reported that the company threatened “immigration consequences” to workers who cooperated with investigators, cut hours for workers they believed were cooperating with the investigation, and implementing a 30% pay cut across the board.
The DOL comments
The company finally agreed to the payments when the court threatened to hold it in contempt for continuing its retaliation against employees when it was ordered to stop — yet the company fired an employee who questioned the payment practices.
“The employer denied nearly 600 workers in four states their hard-earned overtime pay, attempted to hide their greed and illegal actions, and retaliated against workers who asked why they were being cheated,” said Jessica Looman, DOL’s principal deputy wage and hour administrator in a statement. She further referred to this wage theft as “egregious and willful.”
“The Solicitor’s Office is committed to taking every legal step necessary to empower workers to come forward,” said Solicitor of Labor Seema Nanda. “We will swiftly obtain court orders against vindictive employers, oppose intimidating inquiries into workers’ irrelevant immigration status, and defend workers’ ability to speak directly to the department and through their trusted community partners.”
The impact on workers and families A Blog from the DOL points to the effect the wage withholding had on the families involved, many of whom were forced into public assistance due to not being paid what they were owed.
“[One] former Unforgettable Coatings foreman worked 50-60 hours per week without overtime pay. When his family received their back wages, he said, his wife was brought to tears,” the article stated. “‘I hope other construction workers will now feel comfortable coming forward and talking to the Wage and Hour Division about wage theft,’” said [the worker] after the investigation. “‘The money will help us pay bills and support our four children. This case restored my faith in the government and it helps workers like me feel respected and valued for our labor.’”
History of Wage Theft
The contractor has been involved in some high-profile jobs, for example painting part of Allegiant Stadium, and in fact was cited by the Department of Labor for similar payment evasions in 2013.
It’s been a long history of issues with this company according to the DOL, which even back in 2020, expressed its dismay with this company for several reasons: for example, the U.S. District Judge handling the case stated that the company, rather than coming into compliance when wage theft was reported, just devised new methods to try to hide their payment fraud. It then try to deter workers from reporting the underpayments and threatened retaliation if they cooperated with investigators.
In June 2020, said the DOL, Inc. Magazine included the company on its annual list of “Best Workplaces.”
Painters who feel they may be victim of wage theft can call the DOL at 1-866-487-9243
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