Renewing the Workforce

Construction is a large and complex worldwide industry constantly shaped by new information technologies, advanced materials, environmental policies, regulations and changing building methods. Most importantly, though, construction is shaped by people. Sustaining a strong industry requires attracting and valuing a skilled, career-driven, high quality workforce... who also like to build!

How is the construction industry attracting the skilled workforce for future growth market demands? Do prospective candidates see construction as a viable career choice?

While the Texas Legislature prepares to wade into the debate over the best way to deal with payroll fraud, some leaders at the local level say they're not waiting for Austin to take action.

Doug Miller, a city councilman in the Fort Worth suburb of Keller says he's going to be in Austin quite a lot during this legislative session a bit to ask that lawmakers “do the right thing.”

Miller, who is also a vice president of a construction company in Fort Worth, wrote on his blog “I have expressed my support for a bill that will deal with this situation with my state representatives.  I have also looked into having an ordinance in place in Keller that requires contractors that work for the city not have illegitimate contractors, and in the coming year, if this legislation doesn’t pass, I will push something through on the local level.”

Miller said his plaster, masonry, and stucco firm, Bobby Lee and Company, has been underbid by cheaters by as much as 35 percent.

In an interview with Construction Citizen, Miller said his main concern about the legislature is that “they won't do enough”.  He said the Texas Workforce Commission, which has endorsed legislation, needs to go back to the way it used to operate: audit companies for misclassification and penalize them by levying fines.  Twenty years ago, Miller's company was fined for misclassifcation.  “That stopped that for us.  We learned our lesson,” Miller said.  Read more » about Some Won't Wait for Texas to Take Action on Payroll Fraud

Construction industry leaders in North Texas have started the process of figuring out what kind of payroll fraud crackdown they could possibly support.

Members of the Government Affairs Committee of TEXO in Dallas/Fort Worth met to talk about their legislative priorities on Monday and by all accounts they had a lively discussion about the issue of worker misclassification.  Comprised of members from throughout North Texas, TEXO is one of the largest construction industry trade associations in the state.

Jack Baxley, TEXO Vice President of Government Affairs, told me members of the group are still mulling their options and they'll hopefully have recommendations ready by the end of the month.  “This isn't something that just popped up today,” he said while noting that TEXO wants to make sure that any legislation passed is good for the industry. Read more » about North Texas Industry Leaders Mull Over Options on Payroll Fraud

Key players in the construction industry in North Texas today are expected to decide whether they'll support efforts to crack down on the intentional misclassification of construction workers across the state.

Members of the Government Affairs Committee of TEXO, the large trade association for builders in the Dallas/Fort Worth region, are meeting Monday talk about whether they'll take a formal stand against misclassification, also known as payroll fraud, and support legislation to deal with it.  The Texas Workforce Commission has endorsed the idea of rooting out payroll fraud on government contracts.  Lawmakers could decide to do even more than that, depending on what happens during the Texas Legislature's regular session starting this month.  Senator John Carona, R-Dallas, has told his staff at the Business and Commerce Committee to start the process of drafting legislation.   Read more » about North Texas Industry Leaders To Weigh In on Payroll Fraud

The skills gap we’ve covered extensively on Construction Citizen isn’t just a phenomenon in the United States.  It’s also a problem in Europe and the Middle East, where The Economist reports that a quarter of 15- to 24-year-olds don’t have a job.

In a piece called The Great Mismatch”, The Economist Schumpeter Blog says:

“Altogether 75 million of the world’s young people are unemployed and twice that number are underemployed.  This not only represents a huge loss of productive capacity as people in the prime of life are turned into dependents.  It is also a potential source of social disruption and a daily source of individual angst.   Read more » about The Skills Gap Worldwide

OSHA’S Type and Capacity Requirement

This article originally appeared in Crane & Rigging Hot Line, and is reprinted here with permission by the author.

Lately there’s been a lot of chatter in the industry about OSHA requiring operators to be certified by type and capacity.  This particular requirement was included in the new Cranes and Derricks in Construction rule when it was issued in 2010.  It shouldn’t be a surprise to those in the industry, so why all the fuss?

In 2003, OSHA formed a committee to develop the new Cranes and Derricks standard which would replace CFR 1926.550.  This standard surely needed an update because other than the addition of language related to hoisting personnel, which was added in the late 1980s, there hadn’t been any changes to the rule since its inception.

OSHA 1926 Subpart CC, Final Rule was finally issued in August 2010, not only helping the industry to catch up to current industry standards, but going even further in some areas, such as its requirements for crane operator certification.  Operators must be certified by November 10, 2014 through an accredited program and by type and capacity.   Read more » about What's All The Fuss About?

Last week I visited the offices of Camarata Masonry Systems, Ltd to interview their president, Kevin Camarata, about what the craft of masonry is all about.  The following is a transcript from part of our conversation. -EM

EM: How did you get into the masonry business?

KC: It was by happenstance.  In college I worked during summers in construction as a laborer for a general contracting firm because I could make more money doing that than anything else, then basically I just grew to love it.  I was working for a general contractor after college when a friend of mine contacted me.  He ran an engineering personnel placement service, and he thought that I would be a good fit for a relatively young stone contractor out of New Orleans.  I interviewed and was hired.

So your experience before going to work for the contractor in New Orleans was in all different kinds of construction?

It was primarily general contracting and carpentry, specifically, for the general contractor.

Did you have any training outside of the job?  Read more » about Conversation with a Craftsman – Featured Craft: Masonry

In a move that a key lawmaker called “unprecedented” and “unmistakable,” The Texas Workforce Commission (TWC) has unanimously voted to press the legislature to crack down on employers who commit payroll fraud.

The commission is asking the legislature to impose penalties on companies that intentionally misclassify their employees when they get government contracts.

Misclassification of employees happens when a company pays a person as a contractor when that person actually, by law, should be paid as an hourly employee.  This is done to avoid payroll taxes and significantly cut their costs.  Federal law defines what kind of worker can be classified as an employee versus an independent contractor.  Dozens of other states, Oklahoma is a particularly strong example, have passed laws to deal with this.

For the past ten years, Workforce Commissioner Ronny Congleton has pushed for the commission to take a stance on misclassification, often called payroll fraud, but until now his proposals have never gotten any traction.  Read more » about Unprecedented: The Texas Workforce Commission Supports Cracking Down on Payroll Fraud

Crane Institute of America Certification (CIC) and MCM Events, a division of Maximum Capacity Media, have named Jesse Pettit the National Champion of the Crane Operator Rodeo competition held Oct. 27, 2013 in Davenport, Florida.  Pettit, an operator for Maxim Crane in Phoenix, Arizona, first got his experience as a crane operator in the U.S. Army and has been operating cranes commercially for about 10 years.  Pettit took home $1,000 cash and other prizes sponsored by Manitowoc Cranes.

CIC was the Event Partner for the Crane Operator Rodeo, which included five Regional Qualifiers that culminated in the National Championship in October, where 10 finalists competed using a 66-ton LTR 1060 telescopic crawler crane   Read more » about Crane Rodeo Update: National Champion Named

This article by Patricia Kilday Hart originally appeared in the Houston Chronicle on 11/30/2012.  Reprinted with permission.

“Independent contractor” has a nice ring to it.  The title itself carries a certain cachet, as if the person claiming it is self-sufficient enough to shun ordinary employment, brave enough to go it alone.  The self-employed, after all, have only one boss to please.

But in reality, especially in the construction industry, the “independent contractor” label is a dodge.  It’s how some employers get away with skirting laws requiring them to pay a minimum hourly wage, payroll taxes and provide workers’ compensation coverage.  It’s how some businesses game the system to defeat competitors – and hose their employees in the process.

Now, the practice has become so pervasive that some business leaders want the Legislature to ban the “misclassification” of employees in public contracts.  Businesses that aren’t following employment laws shouldn’t get those lucrative government jobs, they reason.

They want a level playing field.  But it’s more than that.  According to Stan Marek, CEO of Houston-based Marek Brothers Construction, the issue has long-term implications for the Texas economy.  Read more » about How To Beat Competitors and Cheat Your Employees

An owner of a New Jersey residential roofing and construction company pled guilty this week and may face serious prison time for stealing over $450,000 in unpaid workers’ compensation premiums and state income tax.  Herlindo Garcia-Merlos was president of Orients Construction Company, Inc in Trenton, New Jersey until March 2009, when he began doing business as Melrose Construction, Inc.  Yesterday, he pled guilty to two counts of second-degree theft by deception for reporting false information to his companies’ workers’ compensation insurance carrier and to the state of New Jersey tax office regarding the wages he himself earned.  He also failed to file corporate tax returns for his companies over the five years covered by the investigation which led to his arrest.

A press release from the office of New Jersey Attorney General Jeffrey S. Chiesa quoted Acting Insurance Fraud Prosecutor Ronald Chillemi who said:

“This defendant was responsible for making sure that he had adequate and lawful workers’ compensation coverage for his companies.  By providing misinformation to his workers’ compensation carrier, he not only failed in this responsibility but also defrauded an insurance company out of hundreds of thousands of dollars.  The cost of such fraud is passed on to consumers through increased premiums.”   Read more » about New Jersey Contractor Guilty of Stealing $450,000

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