A Wisconsin construction company owner has been sentenced to two years’ probation for his scheme of paying his workers less than the prevailing wage for roofers working on a housing project in the local area. The man has also been ordered to pay over $659,000 in restitution in addition to the $1 million he has already been ordered to pay to settle a whistleblower lawsuit.
The New Berlin-based construction company was working on a roofing job awarded under a government contract at a Milwaukee housing project that was projected to be worth $4.7 million to the company, as well as projects in Waukesha and Beloit. The whistleblower in the case was a roofing supervisor who also performed administrative duties for the company. The company claims that she knew of the scheme, but she maintains that many whistleblowers are innocently involved on some level with the fraud before they realize that some sort of illegal scheme is happening. She has been awarded $180,000 for reporting the fraud, but is still awaiting some resolution of a wrongful termination claim against the company, as well as an award of attorney fees for pursuing her claim in the litigation.
According to records, the company was paying workers in some cases only about one-third of the prevailing wage, which the law defines as “the federally calculated amount paid to skilled tradesmen in the area”. Some workers were making as little as $14 an hour when the going rate was up to $45 for some of the workers. When the company was awarded the contract under the stimulus act, it agreed to pay the prevailing wage.
Some employees may be reluctant to contact authorities about alleged misconduct by their employer for fear of firing and other means of retaliation. But whistleblower suits are under seal, meaning that they are not available for public view, until the government decides whether to pursue the case. If wrongdoing is discovered, the whistleblower can receive up to 25% of the amount that the government recovers against the contractor.
If you suspect wrongdoing by your employer, consult an employment attorney who understands how to pursue a whistleblower claim. This can preserve your anonymity and your rights to collect a reward for your diligence, as well as prevent or punish any retaliation that your employer may pursue against you as the investigation unfolds.
Source: Milwaukee Journal-Sentinel, “Builder gets six months’ house arrest for wage fraud,” Cary Spivak, Oct. 1, 2015
Secondary Source: Milwaukee Journal-Sentinel, “Watry Homes owner to plead guilty to fraud, pay $1.6 million settlement,” Cary Spivak, June 15, 2015