When a contractor works on Federal and/or state funded construction projects and fails to pay the appropriate “prevailing wages” or overtime to their employees and/or fails to submit the required “certified payroll reports” to the appropriate agencies —- well it’s pretty serious business.
The following article from SouthCoastTODAY.com will give you a little insight into just how serious it can be.
New Bedford drywall firm settles wage problem
By Staff Report
June 17, 2009
BOSTON — Attorney General Martha Coakley’s Office has reached a settlement with a New Bedford drywall company resolving allegations that the company failed to pay employees the prevailing wage rate, the correct overtime rate and failed to keep proper payroll records for work performed at four Massachusetts public works job sites.
Garcia Drywall Inc. and its president, Emanuel Garcia, have agreed to pay more than $41,600 in restitution to the affected employees and more than $18,000 in fines for intentionally violating the Prevailing Wage, and Overtime and Record Keeping Laws, Coakley’s office said in a press release.
In addition, Garcia Drywall has agreed to a one-year debarment, which prevents them from bidding on any public construction projects, as well as from accepting any contracts for public work for a one-year period in the commonwealth, the Attorney General’s Office said.
In an e-mail to The Standard-Times, the owners of Garcia Drywall wrote that they “truly regret the past errors in interpretation applied in our prevailing wage and overtime payment practices. Upon notification of a complaint, Garcia voluntarily came forward to resolve the aforementioned errors and are in the process, with the Attorney General’s Office, of making restitution to the affected past and current employees.”
The company owners went on to say they “regret any hardship that this may have caused to those affected employees and (we) are committed to complying with the laws of the commonwealth now and in the future.”
In January, the Attorney General’s Office received a complaint alleging that Garcia and his company failed to pay the prevailing wage rate to employees at public construction projects. Investigators from the Attorney General’s Fair Labor Division reviewed a self-audit prepared by the company and discovered that the company had misclassified 26 employees at four public construction sites, including two separate projects at UMass Dartmouth; the Massport State Police Station at Logan Airport; and the Prattville Apartments in Chelsea.
Additionally, according to the press release, Garcia Drywall failed to submit certified payroll records to the awarding authorities at these job sites. Investigators also discovered that the company failed to pay time and a half to employees for working more than 40 hours in a work week.
From the May 2009 issue of the General Ledger.
Firms owned by parents that employ their children. Owners’ children can work for the firm, regardless of age, number of hours worked or time of day—if the parent(s) own 100% of the business. Children under 16 cannot do hazardous work such as use lawn mowers, sewing machines, etc., work where food is cooked, or work near flammable or hazardous material.
Minimum wage: 100% of owners hiring only immediate family members need not pay the minimum wage. But if owners regularly employ nonfamily members, they must pay even family members the minimum wage.
Owners’ children under 21: Wages are exempt from FUTA.
Owners’ children under 18: Wages are exempt from FICA—if the parents are sole owners or sole partners—but FIT must be withheld on W-2s filed for the children.
Other children under 18: Obtain an age certificate recognized by the U.S. Department of Labor (DOL) and your state Wage and Hour Division (WHD) and return it to the workers upon termination. DOL generally accepts a state age certificate, but ask your state WHD to be sure. These workers may not perform hazardous work.
Other children aged 14-15 can work 8 hrs/day, 40 hrs/wk, June 1-Labor Day, between 7 a.m. and 9 p.m. if school is not in session. Exceptions: These limits do not apply to news carriers or children who are employed exclusively by a parent/sole-proprietor. For agricultural jobs, contact the DOL.
Other children under 14 cannot be hired unless they work for a parent/sole owner.
Paid holidays. Under federal law, paying part-time and summer help for holidays is optional any time of year.
Paid vacation. No law requires paid vacation, but if you give paid vacation, some federal and state laws apply.
Benefits. Providing health insurance or other benefits to temporary and part-time employees is optional; if not available, it should be so stated in a written benefits plan.
Federal W-4. Obtain from all summer employees, even students working part-time and foreign students.
FITW. Withhold from all summer employees unless their W-4 results in no withholding.
FICA. Withhold from all workers, even those receiving Social Security benefits and high school students, unless under 18 working for sole-owner parents.
Overtime pay under federal law. Pay overtime for all hours physically worked over 40 hours in the workweek. When computing overtime, you need not include paid time-off (e.g., holidays or vacation days). Do not try to substitute paid nonwork hours for work hours to make all hours straight time, thus avoiding overtime pay.
