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Defraud Taxpayers, You Lose Your Business

Thursday, June 14, 2012   (0 Comments)
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CALPASC Warns Contractors To Beware: Defraud Taxpayers, You Lose Your Business 

SACRAMENTO, Calif.June 14, 2012 /PRNewswire/ -- California's compliant contractors saw another victory in the recently released news by the California Department of Industrial Relations (DIR) on a settlement reached between the California Labor Commissioner and Tadros & Youssef Construction (T&YC) for unpaid wages. On a public works project in the Arcadia Unified School District, T&YC was investigated for not meeting the requirement to pay prevailing wages. According to the DIR release, a settlement in excess of$877,876 was reached, including "back wages and penalties for failure to pay prevailing wage, overtime wages and related labor violations." According to the DIR's Division of Labor Standards Enforcement (DLSE), more than 60 percent of the settlement was comprised of penalties in addition to the amount owed in back wages. T&YC is no longer in business.

Specifically, wages and the training fund were $343,446 and the penalties totaled an additional $534,430. Penalties included liquidated damages - $332,130.45; 1715 penalties (interest on unpaid tax) - $79,500; 1813  penalties (employees work more than eight hours in any one day or 40 hours in any one week)  - $37,050; and 1776 penalties (Certified Payroll Statement violations) through January 12, 2012 - $85,750.

In the DIR release, Labor Commissioner Julie A. Su commented, "We hope this settlement sends a strong message that (this) is an absolute priority of the Labor Commissioner's office."

The California Professional Association of Specialty Contractors (CALPASC) Executive Director Brad Diede stated:

"When you add up the costs incurred of unpaid wages owed, prevailing wage penalties and liquidated damages, the staggering sum of those costs appeared to put T&YC out of business.

"T&YC learned that contractors intentionally defrauding employees by not paying prevailing wages will incur penalties for wage violations and liquidated damages to employees, well beyond the amount of money underpaid in wages.

"CALPASC has repeatedly sent a clear message calling for a level playing field for legitimate contractors who abide by the law.

"Shameless violators who intentionally cheat the system will be caught and penalized well beyond the amount of their bid, therefore, putting their businesses at risk. They would be much better off complying with the law."


SOURCE California Professional Association of Specialty Contractors


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