Wage Theft at Potter County Courthouse

Click HERE to see the full story from Amarillo's news source KAMR-MyHighPlains.com.

KAMR July 20th update on the Potter County Courthouse wage theft case can be seen HERE.

July 12, 2022 - ACTIVISM

Wage Theft & Tax Fraud discovered on Potter County Courthouse Project. 

Central South Carpenters has evidence of workers on the Potter County Courthouse project being paid far less than the contracted & legal wage.

Carpenters Protest outside Potter County Courthouse jobsite.

Central South Carpenters has evidence that workers on the Potter County Courthouse project in Amarillo, Texas, are being paid far less than the legal and contracted wage. Taxpayers and local institutions are suffering as taxes are not being paid on their labor. The County Judge and Commissioners have been notified of these abuses yet continue to allow them.

Council Representative, John Roberts, discovered wage theft and tax fraud happening through a labor broker hired to provide interior systems workers on the Potter County Courthouse project in Amarillo, TX. The construction of the

Potter County District Courts Building is a “public work” covered by the Prevailing Wage rates set forth in Texas Government Code Chapter 2258.

The Central South Carpenters advocate for the development of state and city laws that protect workers throughout Texas. Currently there is little to protect them, and many contractors are taking advantage of that as well as present industrial and economic conditions to beat down wages to a level far below that required to maintain a living wage. It is creating a social problem demanding immediate attention and creating an emergency.

County Commissioners were notified and are continuing to allow it to happen.

Labor unions fight for workers and the carpenters union is no different. This video highlights the statistics on changes the working class has experienced in recent years and what you can do about it. To learn more visit centralsouthcarpenters.org/Activism

Potter County Courthouse Project Overview

The Potter County District Courts Building project bidding process ended on August 3, 2020. The Prevailing Wage Rates and their requirements were stated within the Project Manual at a minimum required wage rate for carpenters of $29.56 per hour ($22.25 in wages and $7.31 in fringe benefits).

The General Contractor on the project, Adolfson & Peterson Construction, a Minnesota company (“A&P”) won the bid at $51.2M. A&P is using several subcontractors and sub-subcontractors for the project. Denman Building Products, Ltd., a local company, is the subcontractor for the drywall work. Denman has eight of its own employees working on the project, plus twenty additional workers provided by a subcontractor, Saavedra’s Construction, LLC.

The Dirty Details

In March, John Roberts, the business representative for Carpenters Local Union 665, was notified that the legally-required wage rates were not being paid for work on the Courthouse. John then went to the jobsite and spoke with the carpenters on-site about the work they were doing and the wages they are being paid.

Mr. Roberts notified County Commissioner John Coffee and County Judge Nancy Tanner about carpenters being underpaid on the courthouse project.

On April 8^th, the County Attorney notified A&P of the wage complaint, and on May 4, 2022, Tim Roth, the Project Manager for A&P, responded to the County attorney, stating that A&P discussed the complaint with its subcontractor, Denman, and that A&P is justified in relying on the certificate provided by its subcontractor regarding payment of all sums due the workers. Mr. Roberts attended the April 25, 2022, Commissioners’ Court, and after the meeting he asked about the status of the prevailing wage issue. Mr. Roberts was asked to attend the May 9, 2022, Commissioners’ Court, and to bring proof such as a worker’s check stub. At the May 9^th meeting, Mr. Roberts provided the Commissioners with additional facts, including proof that a carpenter employed by Denman was not being paid the legal rate, consisting of a pay stub for a Denman carpenter which showed that his wage rate was just $18.50 per hour. This was the highest wage rate reported to John Roberts in his discussions with approximately 20 carpenters at the jobsite. This carpenter had been paid $16.50 per hour for his first sixteen weeks of work. A&P did not appear at the meeting.

The Agenda for the May 23, 2022, Commissioners’ Court included the following: “WAGE COMPLAINT: To discuss and receive comment from Adolfson & Peterson Construction regarding complaint of wage disparity made by John Roberts at the 5-9-2022 meeting.” However, A&P did not attend.

A hearing on this matter was set before the Commissioners’ Court for June 6^th, but was postponed by agreement among the parties until Monday, June 27^th at 1:30 p.m. That hearing was also postponed by agreement, in order for the parties to try to reach a settlement through mediation.

Prior to reaching the agreement to postpone the June 27^th hearing, counsel for CSCRC was told by both the attorney for Potter County and the attorney for Denman that an agreement had been reached during the preparation of bids which allowed Denman to calculate its bid based on wage rates that weren’t included in the Minimum Wage Rates schedule prepared by the Department of Labor and attached to the Project Manual. We do not believe that any other contractors were notified. Chapter 2258 of the Texas Government Code does not have any provision for adding new rates to a DOL minimum wage schedule because of alleged “missing classifications.”

The workers are still not being paid the legally-required wages. We have spoken with a carpenter who was hired in June by the sub-subcontractor, Saavedra’s Construction, LLC, after texting Miguel Saavedra and speaking with him over the phone. The carpenter performed carpentry work at the Courthouse for 38 hours over four days at $21.00 per hour, and received a check in the amount of $798.00, with no tax withholding. The carpenter was told to cash his check at the Happy Burrito restaurant, where they would not ask for any identification. In addition to the wage theft he experienced, the carpenter also reported that “everybody was breaking safety protocol” at the jobsite.

The Council is continuing its fight for justice with a public awareness campaign. Mediation is scheduled for July 18, on the legal claim of violation of Texas law.

To learn more about the wide spread of tax fraud in the construction industry, visit the UBC website stoptaxfraud.net/standup.