After an investigation by the U.S. Department of Labor's Wage and Hour Division (WHD), Gorman General Contractors LLC – based in Oregon, Wisconsin – has paid $34,330 in back wages and fringe benefits to 20 employees for violating labor provisions of the Davis Bacon and Related Acts (DBRA).
Gorman General Contractors LLC subcontracted Miami-based Vitri Corp. to install windows and paint as part of the Modello Homes Project in Miami, Florida. WHD investigators found that subcontractor Vitri Corp. incorrectly classified employees as laborers when they actually performed work as painters. In doing so, the employer paid incorrect prevailing wage rates applicable to the less-skilled job categories and failed to pay the correct fringe benefit rates to the affected employees as required under the DBRA. Gorman General Contractors LLC paid the back wages owed after Vitri Corp. failed to pay and no longer worked at the site. Under DBRA, the prime contractor is responsible for the compliance and any wages owed by a subcontractor or lower-tier subcontractor.
"Contractors and subcontractors awarded federal contracts must understand that incorrectly classifying employees can lead to numerous violations," said Wage and Hour Division District Director Tony Pham, in Miami, Florida. "Owed back wages and fringe benefits associated with these errors can add up quickly. The U.S. Department of Labor offers employers a wide variety of tools and free prevailing wage seminars to help them understand their responsibilities."
The DBRA requires contractors and subcontractors performing work on federal and certain federally funded projects to pay workers prevailing wage rates and fringe benefits as determined by the U.S. Secretary of Labor and as included in their contracts.