Investigations Reveal Long Island Contractors Shortchanged Employees on Federal Projects

NEW YORK, Nov. 4, 2024 – The U.S. Department of Labor has recovered $877,834 in back wages and fringe benefits for 36 employees who were underpaid by three Long Island contractors working on federally funded housing projects in New York City. These violations stem from the contractors' failure to pay workers at prevailing wage rates as mandated under the Davis-Bacon and Related Acts (DBRA).

The New York City Department of Housing Preservation and Development (HPD) initially uncovered the violations involving Discover Electric Inc., EMG Industrial Chimney Inc., and QNCC Electrical Contracting Corp. Following the city’s investigation, the contractors contested the findings, prompting the U.S. Department of Housing and Urban Development (HUD) to refer the matter to the Department of Labor’s Wage and Hour Division for further investigation.

After independent investigations confirmed the violations, the department secured the following reimbursements:

Discover Electric Inc.,

Based in Rockville Centre, improperly classified 11 workers as "jobbers" or "maintenance and repair workers" rather than electricians, leading to wage and benefit shortfalls. The department recovered $43,984 in back wages and $550,321 in fringe benefits.

EMG Industrial Chimney Inc.,

Located in West Babylon, misclassified 21 workers as "service fitters" instead of "insulators" and "sheet metal workers." This resulted in underpayment of $69,252 in wages and benefits.

QNCC Electrical Contracting Corp.,

From Port Washington, failed to pay required fringe benefits to four apprentices, totaling $214,277.

Jorge Alvarez, District Director of the Wage and Hour Division in New York, emphasized that “These cases demonstrate that employers cannot circumvent their legal obligations or avoid paying the wages and benefits rightfully due to their employees on federally funded construction projects.”

In response to the investigations, all three contractors have agreed to comply with the Davis-Bacon Act and related requirements on future federally funded contracts.

“Workers deserve fair compensation for their labor,” said Alicka Ampry-Samuel, HUD’s Regional Administrator in New York. “At a time when we face a housing shortage, it’s crucial to support workers who are helping to expand the supply of affordable housing.”

The investigations covered worksites located at 463 West St. and 10 Monroe St. in New York City. The Wage and Hour Division’s New York City District Office conducted the investigations, and the findings highlight the importance of ensuring compliance with federal wage laws.

To assist with future compliance, the Wage and Hour Division will host a series of online seminars in 2024 and 2025, offering free registration. The seminars will cover prevailing wage compliance under the Davis-Bacon Act and provide helpful resources for employees and contractors alike.

From Constructionowners.com's perspective, this investigation highlights the critical importance of compliance with federal wage regulations, especially in the construction industry. The findings emphasize that misclassification of workers and the failure to pay prevailing wages not only shortchange employees but also undermine the integrity of federally funded projects. For construction business owners, these cases serve as a stark reminder of the necessity to thoroughly understand and implement the Davis-Bacon and Related Acts (DBRA) requirements. Ensuring proper classification and fair compensation is not just a legal obligation but a vital part of maintaining trust and accountability in public construction contracts.

For more information on how to check if you are owed back wages or how to file a complaint, visit the Wage and Hour Division’s website or call the agency’s toll-free helpline at 866-4US-WAGE (487-9243).

For more information on Davis Bacon Act click here to read this blog or you can listen in to this podcast.