Thu, 11/19/2020
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According to D.C.’s Office of the Attorney General, wage theft is “rampant” in DC’s construction industry, as contractors gain “undue advantage” in contract bidding on the backs of workers.
By one recent estimate by the Economic Policy Institute, workers lose over $50 billion per year to wage theft nationwide. “Wage theft” by unscrupulous employers can take many forms—employee/contractor misclassification, minimum wage violations, overtime violations, or even just failing to cut a check on payday.
The construction industry is a notoriously bad offender. The problem of wage theft has become “rampant in the District’s construction industry,” according to D.C. Office of the Attorney General. DC OAG Report: Illegal Worker Misclassification: Payroll Fraud in the District’s Construction Industry. As described in the report, employers in the construction industry, where work is awarded by bid, keep their contract bids competitive by reducing labor costs, often through unlawful wage theft, including:
- Misclassification as a “contractor” rather than an “employee.” Employers often misclassify employees because minimum wage and overtime laws do not apply to contractors. Additionally, contractors do not earn sick leave and other benefits, and may have to pay additional Social Security and Medicare taxes. Whether a worker is an “employee” or a “contractor” depends on whether the employer sets their hours; controls what the employee does at work and when, how, and where the employee does it; provides tools and equipment necessary to do the employee’s work; and other related factors.
- Failure to pay overtime at one and one-half times the regular rate of pay for work performed over 40 hours in a workweek. Employees must be paid for all work that they perform even if it is outside of their scheduled shift. For example, a construction company that requires its employees to spend an extra 15-30 unpaid minutes per day cleaning up the work site after their shifts is liable for overtime if those employees work over 40 hours in a workweek.
- Failure to pay the federal or state minimum wage. Federal minimum wage is $7.25 per hour, although D.C. ($15/hour) and Maryland ($11/hour) have set higher minimum wages. Additionally, many local governments, including D.C., have set higher minimum wages, called “living wages,” for employees of government contractors.
- Late or withheld paychecks.
For more information on workers’ rights and other common wage theft issues, please visit MSE’s Information page at: https://www.mselaborlaw.com/practice-areas/unpaid-regular-pay-overtime. If you think your employer has violated your rights, contact MSE at info@mselaborlaw.com.
