When the private sector does not address a major issue, the public sector will often step into the vacuum and do it. The construction industry has been slow to embrace the principles of social responsibility and sustainable value, focusing instead on whatever it takes to be lowest bidder. As a consequence of this, government is adopting policies that reshape the rules for the industry.

When you think of OSHA (Occupational Safety and Health Administration), you probably think of technical workplace safety regulations.  However, don’t forget that OSHA is also responsible for enforcing the whistleblower provisions of twenty-two federal laws with anti-retaliation provisions.

OSHA maintains a separate website section for whistleblower issues at www.whistleblowers.gov.

OSHA received 2,787 whistleblower complaints during the last fiscal year.  More than half were complaints of retaliation for reporting workplace safety issues.  Complaints are expected to increase this year, because as of December 5, 2013, individuals may file a whistleblower complaint with OSHA using a simple online form.   Read more » about Beware of Whistleblower and Retaliation Claims

Now that the state is moving forward with a targeted crackdown on the practice of worker misclassification, which some in the construction industry have called “a cancer,” lawmakers are going to work through the summer to figure out what more they can do when they reconvene in a regular session in 2015.

As you may recall, the Texas Legislature in 2013 passed a bill to root out misclassification on public works projects.  While many see that as a step in the right direction, it doesn't go nearly far enough to address the problem.  As our readers well know, worker misclassification happens when a company pretends its employees are independent subcontractors when by law the workers qualify as employees and therefore should receive benefits and have their taxes deducted and matched.  While there are many legitimate uses for subcontractors, the abuse happens when a company does this with the intent of skirting the law and avoiding payroll taxes.

Texas House Speaker Joe Straus, R-San Antonio, has now instructed House members to “examine the issue of misclassifying employees as independent contractors [and the effect this practice has] on workers, employers, income tax withholding, and the unemployment insurance system.  Review current statutory deterrents, including those required by HB 2015 (83R), and make recommendations for changes if necessary.”   Read more » about Texas House to Study What More Should be Done on Worker Misclassification

In Texas political races all over the state, candidates are being grilled about what they think of sweeping education reforms passed by the legislature last year.  While there is pretty much universal agreement that the big reductions in standardized testing were a positive step, there is controversy about changes to graduation requirements that create multiple paths to a high school diploma.  The idea, essentially, is that not all kids will go to college so the state will now promote both college readiness as well as career readiness.

The business community is not monolithic, so there are some such as the Greater Austin Chamber of Commerce and the Texas Association of Business as well as some minority rights groups which want to roll back those reforms.   Read more » about Education Reforms Emerge As a Point of Contention in Texas Political Contests

This article by Professor Leonard T. Jernigan Jr. originally appeared in the North Carolina Workers’ Compensation Journal on January 9, 2014.  Reprinted with permission.

Employer Fraud Cases (9):$44,962,492.00 + Employee Fraud Cases (1): $1,500,000.00 = Total: $46,462,492.00

Every year we hear about fraud in Workers’ Compensation cases, and the public believes the fraud is employee driven.  However, in 2009 I began tracking the Top Ten Fraud Cases, and 100% of the Top Ten between 2009-2012 involved employers or shady characters posing as legitimate businesses.  The amount of employer fraud is staggering.  In 2013 one employee fraud case did crack the Top Ten, so the record is now 49-1 (employer fraud v. employee fraud) over the past five years.

  1. Florida: Owners of Diaz Supermarkets in Miami-Dade are Accused of $35 Million Fraud (4/16/13) - John Diaz and his wife Mercedes Avila-Diaz owned and operated four supermarkets in the Miami-Dade area.  They have been arrested and accused of workers’ compensation fraud and other fraudulent transactions totaling $35 million.  One business they operated had no coverage for employees for ten years.

  Read more » about $46 Million Stolen: 2013′s Top Ten Workers’ Compensation Fraud Cases

New regulations affecting federal contractors are scheduled to go into effect on March 24, 2014.  The regulations involve federal contractors’ affirmative action and recordkeeping obligations for veterans and disabled workers.

The agency issuing the regulations is the U.S. Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP).  OFCCP regulates federal contractors.

Application to Construction Contractors

In general, contractors and subcontractors who hold a Federal or federally-assisted construction contract in excess of $10,000 are subject to regulatory requirements under one or more of the laws enforced by OFCCP.   Read more » about Federal Contractors Take Notice – New OFCCP Regulations

The Florida Department of Financial Services Divisions of Workers’ Compensation and Insurance Fraud have released a joint report summarizing their efforts and activities in combating workers’ compensation fraud for the period of July 1, 2012 through June 30, 2013.

Highlights of the report include:

  • Workers’ compensation premium fraud continues to be a high priority.  Cases involve construction industry contractors using shell companies and check cashing stores to launder money for cash pay to workers in order to avoid paying proper premiums.
     
  • The report’s authors write: “This scheme allows these uninsured contractors an unfair advantage when competing with legitimate companies who abide by state statute and obtain and maintain workers’ compensation coverage on all their employees.”

  Read more » about Florida Report on Workers' Compensation Enforcement

Construction companies across Texas that work on public projects are on notice now that the targeted worker misclassification crackdown passed by the legislature in 2013 has taken effect.

HB 2015 “Worker Classification” was signed into law on June 14, 2013, and became effective on January 1, 2014.  This law is considered by many to be a good first step in the fight against the problem that is especially rampant in residential and commercial construction.  But, advocates for workers and for a fair marketplace understand that much more needs to be done in the years to come if the playing field is going to be leveled so that ethical companies will be able to compete.  While putting these penalties in place on public projects will help in the commercial sector, nothing at all will change in residential construction.   Read more » about Targeted Worker Misclassification Law Takes Effect in Texas

Now that the City of Houston is moving forward with a policy to crack down on employers that steal the wages of workers, the pressure will be on to make it work.  It'll be no small task because, as you well know, those that engage in these crimes against hard-working Texans are pretty slippery characters.  And that's probably being kind about it.  Laura Perez-Boston at the Fe y Justicia Worker Center tells us exactly what the law is designed to do:

“The ordinance establishes a process housed in the Office of the Inspector General through which employees can bring wage claims forward.  Companies with a documented record of wage theft – either final adjudication from a court of competent jurisdiction or a criminal conviction – will be included in a publicly listed database on the City’s website and will be ineligible for city contracts or sub-contracts.  Additionally, any company with a criminal conviction of wage theft will be ineligible to receive occupational permits and licenses.”   Read more » about Houston Must Aggressively Enforce Its Wage Theft Ordinance

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