News

April 17, 2023

There’s a crime wave affecting hard-working New Yorkers that you won’t hear about on cable news. Construction contractors are using underhanded schemes, shell companies, shady bank accounts, and check-cashing stores to avoid paying employees the full pay they have earned. In New York, that adds up to $1 billion in wages lost every year, impacting tens of thousands of workers. 

As Americans finish filing their income taxes this week, consider that tax fraud in the construction industry adds up to more than $8.4 billion every year in lost federal and state tax revenue. Funds that should be going to fund police and emergency services, build schools, or help veterans are instead lining the pockets of wealthy developers who refuse to play by the rules.  

Getting cheated out of wages is an all-too-common experience for construction workers, and with 528,000 New Yorkers employed by the construction industry – about 1 in 18 workers statewide –  this is an issue that hits close to home for thousands of families in the Empire State. 

Law enforcement officials across New York are stepping up to fight this crime wave, but more needs to be done in Albany to strengthen existing laws. 

At the state level, the Construction Wage Theft Task Force is a coordinated effort among the NYS Department of Labor (NYSDOL), the New York State Attorney General, and local District Attorneys to combat corruption and crime within the construction industry. Due in part to the efforts of this task force, the NYSDOL has recovered more than $360 million in stolen wages over the past decade. 

At the county level, aggressive district attorneys are also cracking down on wage theft. During his tenure as president of the District Attorneys Association of New York, Orange County District Attorney David Hoovler made fighting tax fraud a top priority. Just a few weeks ago, Manhattan District Attorney Alvin Bragg announced his office’s first-ever Worker Protection Unit to investigate and prosecute wage theft. That new unit builds on the success of his predecessor’s Construction Fraud Task Force.

In Albany, there is a renewed push to toughen penalties for stolen wages. A bill introduced by Senator Neil Breslin and Assemblymember Catalina Cruz would amend the penal law in relation to wage theft. This legislation would enable prosecutors to charge larceny for stolen wages, which is a much more serious felony charge than a typical “scheme to defraud” that might be charged today. 

It makes sense – why should a rich contractor get off easier than a petty thief if they both end up stealing a day’s wages from a construction worker?

We hear a lot lately about rising crime, but wage theft is one that stays under the radar. The offenders rely on their victims to stay silent, threatening future employment opportunities and using their power and influence to evade accountability. That’s coming to end, because more and more people understand that workers aren’t the only ones being cheated. Stopping wage theft is good for business, it’s good for blue collar workers, and it’s good for New York’s economy.

Via Gotham Gazette Op-Ed by Bill Banfield, Assistant to the Executive Secretary-Treasurer of the North Atlantic States Regional Council of Carpenters (NASRCC), the union representing more than 30,000 men and women employed by the leading residential and commercial general contractors and carpentry subcontractors in the region.