More than 100 construction workers who helped build Browning High School in Long Beach will be paid back wages out of a $1.1 million settlement labor officials recently secured against a contractor accused of cheating workers out of their fair pay, authorities announced Monday.
Labor officials alleged that Newport Beach-based Champion Construction Inc., a drywall and framing contractor hired by San Diego general contractor TB Penick for the Browning project, maintained false payroll records over a six-month period to cover up theft affecting 103 workers who were not paid the required wages and fringe benefits.
California’s wage laws hold general contractor TB Penick jointly liable for the violations of its subcontractor Champion, state Labor Commissioner Julie Su said.
“Prevailing wages create a level playing field for all contractors bidding on public construction projects,” Su said. “This case clearly demonstrates that general contractors who select contractors that don’t play by the rules will pay a heavy price. Under the law, they are responsible for the wage theft of their subcontractors.”
The Labor Commissioner’s Office opened its investigation after receiving a report from the Carpenters/Contractors Cooperation Committee in March 2016 alleging public works violations.
The investigation included interviews with more than 30 workers, site visits and an audit of pay records for the dozens of workers involved in the project, Su said.
“I couldn’t pay my bills and I had to move in with my brother,” Jose Lopez, one of the worker who received a restitution check, said, according to a statement from the Carpenters/Contractors Cooperation Committee.
Lopez said the settlement shows, “The people that abuse workers should be alert that it’s not going to be so easy now to exploit workers.”
The investigation led to civil wage and penalty assessments of $1,735,784. Penick entered into a settlement agreement to pay $1,187,078 of the penalties and wages owed.
The group of 103 workers received $744,533, or an average of $7,228 each last week when the employer delivered its final payment, according to Su. The settlement also included $8,080 for required apprenticeship training funds and $434,465 in civil penalties.
Subcontractor Champion was also found at fault for wage theft violations affecting 47 workers on a project in El Segundo last year. Champion’s state contractor license expired in July 2016 and public works contractor registration expired last year, the labor commissioner said.
Jeremiah Dobruck contributed to this report
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