Feds say contractors failed to pay workers $255,474

Victoria Baily, of Gary, holds her 1-year-old daughter, Savanah Mask, as they gather along with others to watch the Sojourner Truth House break ground Monday morning for the Village of Hope, a 40-unit permanent supportive housing development that will provide housing for some of the homeless men, women and children the Sojourner Truth House serves and for other homeless from the community. The U.S. Department of Labor found contractors failed to pay workers $255,474 on the project.

The U.S. Department of Labor found four contractors failed to pay $255,474 in wages owed to workers who built the Village of Hope housing project in Gary.

The federal agency ordered the contractors to pay 53 workers after an investigation found the contractors violated labor laws when constructing the Housing and Urban Development's 40-unit housing development for the homeless at 400 W. 12th Ave. in Gary. Investigators concluded the contractors did not comply with the Davis-Bacon and Related Acts by not paying prevailing wages and fringe benefits. The department banned one of the contractors from bidding on federal projects for three years.

“Government contractors receive detailed agreements that include prevailing wage and fringe benefits rates, required to be paid by all contractors working on a federally funded project. Prime contractors must assure that their subcontractors adhere to these rules as well,” said Wage and Hour Division District Director Patricia Lewis, in Indianapolis. “Violations can easily be avoided, and we encourage all employers to come to us for confidential assistance to understand their responsibilities under the law.”

The Village of Hope's prime contractor, Indianapolis-based TWG Construction, has paid $82,477 owed to 20 employees after a temporary staffing company it subcontracted with misclassified temp workers on cleaning service crews and failed to pay them the required prevailing wages, according to the Department of Labor.

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Alsa, Indianapolis-based DLW, which operates as Drexel Interiors, has paid $5,608 to six flooring installers who were misclassified and underpaid for their work, and Indianapolis-based KJB Drywall LLC must pay $98,367 to eight employees after a subcontractor did not pay them prevailing wage rates and fringe benefits.

Lansing-based 8 Aces Construction paid back $69,022 owed to 19 finishers, painters and carpenters who were not paid prevailing wage rates on the project.

"Due to the repeat and willful nature of these violations, 8 Aces Construction Inc. and owner Jose 'Tony' Ochoa have been declared ineligible to bid on federal DBRA contracts for a period of three years," the Department of Labor said in a press release. "A 2017 investigation found 8 Aces owed back wages totaling $99,313 to 95 employees."


Business Reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.