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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.

Low-wage workers, grassroots community organizations, and responsible businesses are together writing a historic chapter in the City of Houston’s development.  Beginning in late 2011, the Fe y Justicia Worker Center began building a coalition of organizations and responsible businesses – now 34 members strong – across the City of Houston to address the problem of wage theft and craft a sensible public policy solution.

On July 23rd, workers, grassroots organizations, people of faith, and community leaders joined forces at the City Council’s Public Safety Committee Hearing held in the Houston City Council Chambers to make the case that an anti-wage theft ordinance is sound public policy   Read more » about Precedent-Setting Anti-Wage Theft Ordinance Within Houston's Reach

A new law in Tennessee gives the state’s Department of Labor (DOL) sharper teeth with which to take a bigger bite out of workers’ compensation fraud in the construction industry.  As of July 1, 2013, the Tennessee DOL not only has the ability to fine a contractor for not having a workers’ compensation policy, but now can assess administrative penalties for the fraud as well as refer cases where the fraud is discovered to the Tennessee Bureau of Investigation or to the local district attorney for further prosecution.  The Society for Human Resource Management published an article written by Susan R. Heylman (subscription required) explaining the new authority this law gives the Tennessee DOL:

“If the department finds that a construction company improperly classified workers as independent contractors rather than as employees, it may impose on the company fines of up to $1,000 or 1.5 times the average yearly workers’ compensation premium that the company should have paid for the workers.”   Read more » about Tennessee Takes a Bite out of Worker Misclassification

Last week Houston City Council’s Public Safety Committee held a hearing to discuss a proposed city ordinance to eradicate wage theft in the Houston area.  The hearing included a presentation by Houston City Attorney David Feldman who explained the details of the proposal, and statements from members of the public who support it.  Following the hearing, Scott Braddock interviewed Ed Gonzalez, Mayor Pro Tem of Houston and chairman of the Public Safety Committee.  Read the following transcript of that interview, or watch the 4-minute video below.

Scott Braddock:  Talk a little about how this came about.  This has been something the people have been asking for – pleading for – for years.  Why now?

Ed Gonzalez:  We heard those concerns here at Council.  The mayor and myself had assured that we were listening.  We know the bureaucratic process can be slow at times, but we promise that we were listening and considering the feedback.   Read more » about Committee Chairman Discusses Proposed Wage Theft Ordinance [VIDEO]

Laws Fight Questionable Practices that Misclassify Workers or Seek to Avoid Paying State Employment Taxes or Premiums

The Illinois Governor’s Office reported on Tuesday that Governor Pat Quinn signed new laws that day that will help protect Illinois workers’ pay by fighting questionable business practices, particularly in the construction industry. The laws deal with the misclassification of workers and the attempts of employers to avoid paying state employment taxes and premiums. This week’s action is part of Governor Quinn’s commitment to ensuring that all Illinois workers are treated fairly and receive the compensation they deserve.

“Workers shouldn’t have to worry about whether their employers are following the rules and paying everything they owe,” Governor Quinn said. “These new laws will also help the state collect the money it’s owed and help those out of work find employment.”

House Bill 2649, sponsored by State Representative Luis Arroyo (D-Chicago) and State Senator Bill Cunningham (D-Chicago), addresses a common construction industry practice of misclassifying workers as independent contractors.   Read more » about Illinois Governor Quinn Signs Laws to Protect Workers’ Paychecks

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Despite concerns from some council members about a “cleaner process” for going after employers who cheat workers out of their pay, the chairman of the Houston City Council’s Public Safety Committee on Tuesday pledged an “aggressive” timetable to enacting a tough wage theft ordinance.

Committee Chairman Ed Gonzalez held a public hearing on the proposal that included testimony from workers who have been cheated and a construction executive who says he’s “ashamed” that the practice of stealing wages often happens in his industry.  Gonzalez said the concerns “are not falling on deaf ears”.  He said his office has worked with the city attorney to craft something that is workable and will make headway, even if the proposal might need some changes before it can be adopted.  “It’s not good enough to say you can’t stop everyone so you should do nothing,” Gonzalez said.  “We have to address this.”   Read more » about Houston Moves Forward With Wage Theft Crackdown While Private Sector Solution Emerges [VIDEO]

We've been telling you about the problem of wage theft for years and it sounds now like the Houston City Council is getting serious about it. Tomorrow, the council's public safety committee will take testimony on the proposal to go after those unscrupulous employers who steal the labor of their workers.

Laura Perez-Boston, Director of the Fe y Justicia Worker Center in Houston, is trying to rally support for the city cracking down on this problem. “We have a very narrow window of time to get this ordinance passed and your voice is crucial,” she said in a note to supporters.   Read more » about Houston Considers Wage Theft Ordinance

CongressThe Construction industry, like much of the rest of the country, now turns its attention to the House of Representatives as sweeping immigration reform moves to the lower chamber where Republicans control the agenda. As we've reported, the industry was working hard to persuade senators to lift the arbitrarily low cap on construction workers. The Washington Post now reports that they've lost the battle:

"While industry advocates say the companies will need to hire more than 200,000 new workers per year, under the Senate bill the number of foreign-worker construction visas can never exceed 15,000 per year.

The setback, unusual for an otherwise powerful special-interest lobby, reflects the political tightrope being walked by each party as leaders try to pass an immigration overhaul while balancing concerns from influential skeptics. Read more » about Construction Still Fighting For More Workers in Immigration Bill