Construction firms that regularly skirt labor law to gain unfair competitive advantages by misclassifying workers and hiring people who aren’t legally allowed to work in the U.S., are going to face closer scrutiny this year, according to a report published in the National Law Review.
Southwest Under Labor Law Scrutiny
The NLR reported “that some of the nation’s biggest industries will be subjected to additional labor law oversight in 2015, including the oil and gas services industry, the construction industry and the hospitality sector.” Besides focusing on investigations of payroll and time records, I-9s, and affirmative action plan reports, the Department of Labor will pay special attention to Texas and the southwest region where there was a 571% increase in retaliation investigations between 2012 and 2013.
The Exempt Employee Dodge
Retaliation happens when an employer takes adverse actions against an employee who exercises their rights under the Fair Labor Standards Act. Wage and hour complaints skyrocketed in the Southwest along with retaliation incidences. The most common complaints arise when workers aren’t paid the overtime owing to them, or they aren’t paid the minimum wage. Employers sometimes get out of paying overtime by classifying workers as exempt.
Employers get into trouble when they classify people according to their job titles rather than according to their duties. Surprisingly, withholding wages is another area that generates many complaints under the FLSA. This whole area of labor law gets more complex because many states have their own of labor laws that are more stringent than federal regulations.
Construction has a checkered past when it comes to misclassifying workers. One very common tactic is to classify workers as independent contractors to avoid withholding and payroll expenses like workman compensation and unemployment.