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Know Your Rights
Source: Crain's New York Business
Subject: Workplace Justice
Type: Media Coverage

Sandy contractor hit with $500K bill

A company hired to clean up three big, city-owned hospitals damaged by the superstorm is ordered by the state attorney general’s office to fill in the gap between the $17-an-hour prevailing wage and the $10- to $12-per-hour rate its subcontractors paid their workers.

A contractor who helped clean up three public hospitals damaged by Superstorm Sandy has been ordered to pay half a million dollars in back wages, according to the New York state attorney general’s office.

Hired to clean up Bellevue Hospital Center, Coney Island Hospital and Coler-Goldwater Hospital, contractor Signal Restoration Services brought in subcontractors to do the work. Because the hospitals are owned by the city Health and Hospitals Corp., a public entity, the workers should have been paid a prevailing wage of about $17 per hour. Instead, Signal’s subcontractors were found by the attorney general’s office to have paid $10 to $12 per hour.

As a result, Signal has been ordered to pay $512,026 in back wages. The company could not be reached for comment.

The move reflects a renewed emphasis, particularly from Comptroller John Liu, on enforcing wage violations, said Maria Doulis, director of city studies at the Citizens Budget Commission, an organization that tracks government finances.

“This comptroller in particular has made prevailing wage violations a big priority,” she said. “People should be following the law, but we need more transparency in how these wages are set, because they do tend to be pretty high.”

Labor advocates applauded the agreement.

“Exploiting workers is always wrong, but doing so during a natural disaster like Hurricane Sandy is especially offensive,” said Robert Bonanza, business manager of the Mason Tenders District Council of Greater New York, in a statement.

Deborah Axt, co-executive director of the advocacy group Make the Road New York, which along with the Council had flagged the suspected wage violations to the attorney general, was also pleased.

“The New York state Department of Labor has such a paralyzing backlog that they cannot even begin to adequately monitor Sandy work sites,” she said. The attorney general’s action here is a decisive and important step in the effort to reverse that trend.”

Since Sandy, more than $2.2 million has been recovered in back wages owed by contractors, according to the New York City comptroller’s office.

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