Wage and Hour Division (WHD)
Archived News Release — Caution: Information may be out of date.
Date: April 9, 2013
Contact: Scott Allen or Rhonda Burke
Phone: (312) 353-6976
U.S. Department of Labor
Wage and Hour Division
Release Number: 13-385-CHI
US Labor Department investigates BBC Foundations & Flatwork, finds more than $137,000 in back wages due to 31 employees
Contractor denies employees prevailing wages, fringe benefits on federal transit project
CARLETON, Mich. -- BBC Foundation & Flatwork LLC has paid $137,705 in back wages to 31 employees of the Carleton concrete company for performing work on a federal transit project in Toledo, Ohio. An investigation by the U.S. Department of Labor’s Wage and Hour Division found that the contractor violated the Fair Labor Standards Act, Davis-Bacon and Related Acts and the Contract Work Hours and Safety Standards Act.
“In this competitive contracting environment, no contractor should gain an economic advantage by paying workers below the wages and fringe benefits required on a federally funded construction project. Not only does this practice undercut what is legally owed to the workers involved, it results in unfair competition,” said Timolin Mitchell, director of the Wage and Hour Division’s Detroit District Office. “Enforcement of the prevailing wage laws levels the playing field for all contractors and ensures that workers bring home the wages they have rightfully earned.”
Investigators found BBC Foundation & Flatwork paid employees less than the required prevailing wages and fringe benefits for work on a Federal Transit Administration project to build a new Toledo Area Regional Transit Authority facility, violating the DBRA and CWHSSA. BBC, performing work on this project as a subcontractor to The Garrison Co., of Farmington Hills, falsified certified payroll documents it submitted to the contracting agency in an attempt to show payment at the required rates by recording fewer hours than were actually worked. This practice also resulted in a failure to pay employees overtime, since the falsified payroll forms indicated employees worked less hours than they actually did. As a result of these violations of the CWHSSA, liquidated damages were computed and notification was forwarded to the Federal Transit Administration.
Investigators also found violations of the FLSA including a failure to pay employees overtime compensation at time and one-half their regular rates of pay for hours worked beyond 40 in a week. The employer operated under two different business names and failed to combine hours worked when employees performed work under both companies during the same workweek. Additionally, BBC did not maintain time records documenting daily and weekly numbers of hours worked, as required.
The company has paid the back wages found due in full. BBC further agreed to comply with the FLSA, the DBRA and the CWHSSA in the future, and to implement a system to monitor payroll for overtime hours.
The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates of pay for hours worked beyond 40 per week.
The Davis-Bacon Act requires 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. On a Davis-Bacon Act covered project, the prime contractor is responsible for the compliance of all subcontractors.
The CWHSSA applies to federal service contracts and federal and federally assisted construction contracts over $100,000. These require contractors and subcontractors on covered contracts 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.
For more information about the FLSA, Davis-Bacon Act, the CWHSSA and other federal laws, contact the Wage and Hour Division’s Detroit District Office at 313-226-7447 or call the division’s toll-free helpline at 866-4US-WAGE (487-9243). Information is also available at http://www.dol.gov/whd.
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