From NY State Attorney General’s Office
The investigation into a contractor at a taxpayer-funded affordable housing project in Brooklyn has come to an end, and the contractor must pay back wages.
New York State Attorney General Eric T. Schneiderman announced the resolution of an investigation into Masonry Services, Inc. (“MSI”) and its owners, James S. Herrera and Jaime T. Herrera, for underpaying masonry workers on the St. Marks Project. Developed under the New York City Department of Housing Preservation and Development (HPD), the St. Marks Project is a publicly funded affordable housing facility for seniors in Brownsville.
The agreement with the Attorney General’s Office requires MSI to pay back wages totaling $575,000 as well as $25,000 in costs.
The St. Marks Project received public funding, triggering the requirement that workers must be paid the prevailing wage. Prevailing wage laws seek to ensure that government contractors pay wages that are comparable to the local norms for a given trade.
The law requires an hourly rate for construction work performed for public agencies that is well above the state and federal minimum wage of $7.25 per hour, along with certain additional benefits.
Between June 2009 and July 2010, the masonry workers on the St. Marks Project were paid between $8 and $23 an hour – well below the applicable prevailing wage rates – and were not paid overtime despite regularly working more than 40 hours a week.
New York City has recently been engaged in a legal battle surrounding a city-imposed prevailing wage legislation. In May 2012, the City Council approved a law thgat required that a prevailing wage, as opposed to only the state’s minimum wage, be paid to building service workers employed by companies that receive over a million dollars in economic development aid, employees of contractors who are awarded receive over a million dollars from the city in economic development aid, and the building service workers of companies that lease property to the city.
After the council overrode his veto, Mayor Michael Bloomberg sued over the validity of the law. Manhattan Supreme Court Justice Geoffrey Wright ruled that since New York City’s prevailing wage law “mandates that private employers [landlords and building owners] pay their private employees [building service workers] a wage higher than the state’s minimum wage,” this amounted to a “citywide minimum wage” and therefore invalid.
However, the state’s own prevailing wage laws, which take preference over city rules, are still valid and in effect.
In addition to securing restitution for underpaid workers, the St. Marks Project agreement also requires MSI, James S. Herrera and Jaime T. Herrera to pay for independent monitoring of MSI’s labor practices on private and public construction projects for three years, with unannounced on-site inspections.
In the event of any future public works violations, MSI and the Herreras would be placed on the New York State Debarment list, preventing them from working on New York state public works projects for five years.
“[This agreement] sends another clear signal to anyone wishing to work on publicly funded jobs in New York – using taxpayer money to exploit workers will not be tolerated,” said Robert Bonanza, business manager of the Mason Tenders District Council.
--With Charisma Miller contributing for the Brooklyn Daily Eagle