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Contractor Barred for Wage Fraud

Wednesday, June 4, 2014

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An Arizona subcontractor is banned from federal projects for three years and is repaying nearly $200,000 in back wages after federal prosecutors found falsified payroll records on a highway project.

The U.S. Department of Labor recovered $198,085 in back wages for 23 workers from Tierra Contracting Inc., based in Glendale, AZ, for willful violations of the Davis-Bacon and Related Acts and the Contract Work Hours and Safety Standards Act.

The company and owner Richard Juarez Sr. have also been debarred from seeking federally funded contracts for three years because of the "egregious nature" of the violations.

mcdot.maricopa.gov

"This employer intentionally omitted from payroll records hours employees worked beyond 40 in a workweek to skirt payment of overtime rates," said Eric Murray, district director for the Wage and Hour Division in Phoenix.

Calls to the company Monday (June 2) were repeatedly met with a busy signal.

Failing to Pay

According to investigators, Tierra Contracting failed to pay the required prevailing wage rates and fringe benefits to power equipment operators, water truck drivers, pipe layers, grade setters and laborers working on the federally funded Northern Parkway highway project in Maricopa County.

Tierra Contracting was hired by Lawrence Construction Co. as a subcontractor to perform excavation and installation of water and sewer lines for the project.

Lawrence Construction was awarded the prime contract for the project by the Maricopa County Department of Transportation.

Construction of the Northern Parkway will result in a 12.5-mile corridor with six lanes of traffic. The total projected cost of the project is $612.6 million and construction on planned improvements will last through 2026.

The Northern Parkway is partially funded by the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU). The act incorporates the provisions of the Davis-Bacon and Related Acts, which requires prevailing wages and fringe benefits be paid to laborers and mechanics working on federally funded projects.

glendaleaz.com

Construction of the Northern Parkway will result in a 12.5-mile corridor with six lanes of traffic. The total projected cost of the project is $612.6 million and construction on planned improvements will last through 2026.

The Contract Work Hours and Safety Standards Act also applied to this project and requires contractors and subcontractors to pay laborers and mechanics for federally funded projects one and one-half times their basic pay rate for all hours worked beyond 40 hours per work week.

Skirting Overtime

The company routinely submitted certified payroll records that did not accurately reflect the hours employees had worked, according to the DOL.

Employees were paid for overtime hours with separate checks, off-the-record and at straight-time rates, without the additional time-and-a-half, investigators said.

"This employer intentionally omitted from payroll records hours employees worked beyond 40 in a workweek to skirt payment of overtime rates," said Eric Murray, district director for the Wage and Hour Division in Phoenix.

"As a result of the willful violations found, Tierra Contracting has been determined ineligible to apply for federally funded projects," Murray said.

   

Tagged categories: Contractors; Ethics; Funding; Government contracts; Roads/Highways; Subcontractors

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