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News Release

US Labor Department recovers $431K for workers on Manhattan’s federally funded Peck Slip Project

Litigation alleged prevailing wage, overtime violations

NEW YORK – Thirty-one workers employed on the federally funded cobblestone reconstruction project on Manhattan’s Peck Slip will receive $431,715 in back wages and interest following an investigation and litigation by the U.S. Department of Labor.

The department’s Wage and Hour Division found that the workers did not receive the proper prevailing wages and fringe benefits required under the Davis-Bacon and Related Acts and the Contract Work Hours and Safety Standards Act.

Sam Schwartz Engineering, a first-tier subcontractor under prime contractor MFM Contracting Corp. employed the workers. Investigators found that the employees who worked as flaggers on the project were incorrectly classified. The division alleged that – between August 2011 and January 2014 – they were paid $15 to $25 per hour instead of the prevailing wage rate of $44.49 per hour. The investigation also found workers did not receive all the overtime they were due under CWHSSA when they worked more than 40 hours in a week, did not receive holiday pay and that they were not paid on a weekly basis, as required.

The department’s Office of the Solicitor filed an administrative proceeding in 2015 against MFM Contracting and Sam Schwartz Engineering. The case is now being resolved with a consent findings and order approved by the department’s Office of Administrative Law Judges. Under the order, workers from the Peck Slip project will receive $431,715 in unpaid wages.

“Prevailing wage standards provide a safety net of fair wages to workers, their families and communities and level the playing field for local contractors and subcontractors to compete,” said Wage and Hour Division Regional Administrator Mark Watson.

“Federally funded construction projects are ultimately funded by the taxpayers. It’s imperative that employees working on these projects be properly compensated. When that doesn’t happen, the Labor Department will pursue appropriate legal remedies on the workers’ behalf,” said Regional Solicitor of Labor Jeffrey Rogoff. “Our investigation and actions show the department’s commitment to enforcing these laws to protect both employers and employees. We will continue to use all of the enforcement tools at our disposal to ensure that taxpayer dollars used to fund such contracts are properly spent.”

Read the Consent Findings and Order and the Final Order.

The Davis-Bacon and Related Acts require all contractors and subcontractors performing work on federal and certain federally funded projects to pay their laborers and mechanics the proper prevailing wage rates and fringe benefits, as determined by the secretary of labor. The Contract Work Hours and Safety Standards Act requires contractors and subcontractors on federal and federally assisted construction contracts over $100,000 to pay laborers and mechanics employed in the performance of the contracts one and one-half times their basic rate of pay for all hours worked over 40 in a workweek.

The investigation was conducted by the Wage and Hour’s Division’s New York City District Office. Attorneys from the department’s Office of the Regional Solicitor in New York litigated the case for the division.

For additional information about these and other laws enforced by the Wage and Hour Division, call its toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd/.

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In the Matter of:

MFM Contracting Corp., Prime Contractor
Sam Schwartz Engineering D.P.C., First-Tier Subcontractor
Sam Schwartz Engineering PLLC, First-Tier Subcontractor
Case Number: 2015-DBA-00029

Agency
Wage and Hour Division
Date
July 14, 2016
Release Number
16-1203-NEW
Contact: Ted Fitzgerald
Phone Number
Contact: James C. Lally
Phone Number