Labor Unions Protest Coating Contractor
Despite recently reaching a settlement with the U.S. Department of Labor for misclassifying skilled laborers and denying overtime wages, several unions and community organizations are continuing to protest a coatings contractor in Louisiana.
According to reports, Lanehart Commercial Painting (Baton Rouge, Louisiana) is again being alleged of wage theft at a school renovation project in New Orleans.
Previous Lanehart Investigation, Settlement
Back in August, the DOL shared that PL Construction Services LLC (St. Rose, Louisiana) had misclassified 306 painters and drywall workers as independent contractors, resulting in denied overtime wages. The skilled laborers had been hired for several construction projects, including work at New Orleans’ multi-purpose stadium The Caesars Superdome.
According to the news release, an investigation by the Department's Wage and Hour Division found that many of the employees worked on projects involving Lanehart Commercial Painting—operating as Lanehart. Upon further investigation, the division determined that a joint employment relationship existed between PL Construction Services and Lanehart for workers employed on Lanehart projects.
Among other factors, the division reported the following conditions:
Despite the joint employment relationship, PL Construction Service paid the misclassified workers straight-time rates for all hours, including those over 40 in a workweek. In addition, PL Construction Service had also failed to maintain complete and accurate records of hours their employees worked.
Both practices were in violation of the Fair Labor Standards Act.
In total, the DOL recovered $246,570 in overtime back wages for 306 painters and drywall workers. Of that, Lanehart was reported to pay $199,342 to 243 employees, after being found as jointly liable. PL Construction Services paid the remaining balance of $47,228 to 76 employees.
Late last month, the International Union of Painters and Allied Trades, the International Brotherhood of Electrical Workers and community organizer Unión Migrante, among others, claimed that Lanehart was continuing to pay painters and other workers below what is required by law for the renovation project at Cohen College Prep High.
“What we're concerned about is to make sure that the construction industry contractors are paying proper overtime and then the workers can pay their taxes and get benefits,” said Jorge Salazar of the painters union. “But one way for (the contractors) to make more money is to cheat, and so that's why we’re here, is to let workers know their rights.”
According to reports, the collective of unions is hoping to use Lanehart’s practices to highlight misclassification as a widespread ploy to avoid taxes and underpay laborers.
In an email, Lanehart President Scott Lanehart denied the recent allegations, writing, “It is critical to note that the workers at the site where union members gathered are not Lanehart employees and are not paid by Lanehart.
“Lanehart does contract with B&Z, among other labor providers, for the Cohen High School project. As with all contractors who work for us, they are required by contract to follow all local, state and federal laws,” he continued.
When reporters reached out to B&Z Owner Francisco Zambrano, he declined to comment.
As of last week, the DOL reported that it did not have an open case on Lanehart.
“We had two files involving Lanehart as a joint employer. One file involved PL Construction, and the other involves Ferra Construction. Lanehart paid its back wage portion on both files,” said DOL spokesperson Chauntra Rideaux.
Government Wage Efforts
In March, the DOL proposed a rulemaking for the Davis-Bacon and Related Acts to better reflect the needs of today’s construction industry and planned federal construction investments—a first in 40 years.
According to the DOL, the proposed changes would speed up prevailing wage updates, create several efficiencies in the current system and ensure that prevailing wage rates keep up with actual wages. The department adds that over time, the changes would generate higher wages for workers.
Under the current process, at least 51% of surveyed wages need to be within a “same or similar” margin. If the surveyed wages don’t meet the margin, a weighted average—opposed to a simple average—of all wages is used to determine a rate. The issue with this, according to officials, is that if occurrences of low wages become more frequent, the overall rate would also suffer.
To avoid this issue, the DOL proposed returning to how the DBRA was used from 1935-1983 to ensure prevailing wages reflect actual wages paid to workers in the local community.
During that time, a prevailing wage was determined by the 51% threshold. If the threshold wasn’t met, however, the new rule would allow just 30% of same or similar wages to be used. And, if that bar couldn’t be achieved, a weighted average would then be used.
Other proposed changes include:
Although worker groups and unions are reportedly in favor of the proposed changes, construction employer groups are in disagreement.