New Haven Register (New Haven, CT)
Union: Tax cheats raise costs for all
NEW HAVEN — The rat came back.
Local 326 of the Carpenter’s Union brought its 10foot inflatable rat to Wooster Square Park in a teeming rainstorm as it spoke of companies that allegedly fail to pay workers’ compensation insurance and incorrectly classify workers as independent contractors.
It was the local contribution to the National Day of Reckoning organized by the 500,000 carpenters in the United Brotherhood of Carpenters, which covers employees in the United States and Canada.
The rat often pops up at work sites targeted by the union when stop-work orders are issued over alleged wage issues.
Ernest Pagan, an organizer and business representative of Local 326, said such actions by companies amount to tax fraud when workers are not compensated correctly.
“When they don’t pay, we have to pay more,” Pagan said of taxpayers covering the cost of public services shortchanged by tax cheats.
More than 50 workers in rain gear listened to speakers, including state Attorney General William Tong, describe the issue.
Tong estimated they get complaints about wage issues on a daily basis.
“There are people out there who are committing tax fraud by paying people under the table, by paying people off the books,” he said.
Tong said companies that do this are “stealing” from their workers by not compensating them fairly, by not paying into worker’s compensation to cover any injuries or into Social Security.
“This is not about labor. It is not about unions. It is about families,” Tong said.
New Haven Mayor Justin Elicker said the city struggles when people cheat the tax system. “There are so many people out there that are not paying their fair share,” he said.
“We in New Haven stand for a government that provides people the opportunity to thrive and we need to work in so many different ways together to make sure that people have that opportunity,” Elicker said.
He said the city has started a construction training pipeline to get New Haven workers trained for the building trades.
The rally was held adjacent to Rosa’s Table, which was built in the park as a tribute to the family of U.S. Rep. Rosa L. DeLauro, D-3, who now is chairwoman of the Appropriations Committee in the House of Representatives.
Alder Ellen Cupo, D-8, made a pitch for New Haven residents to get the construction jobs that come to New Haven, given the large amount of building work under way.
The city has the most leverage when construction takes place on property it owns; less so on private property.
Lou Mangini, senior staff member in DeLauro’s local office, read remarks by the congresswoman.
DeLauro said that according to the Economic Policy Institute, wage theft is a $50 billion annual problem with only some $2 billion recovered in 2015 and 2016.
DeLauro said additional money has been approved for the Department of Labor’s Wage and Hour Division to hire more inspectors, while there are also more funds for the Occupational Safety and Health Administration.
She told the gathering that the Biden administration is committed to enforcing the Fair Labor Standards Act.
“In the face of stagnating wages, wage theft and misclassification, we need to rewrite the rules to level the playing field for working people and middle class families,” DeLauro wrote.
Guy Smith Jr., who runs Center Line Interiors of Milford, said he became a union company after 10 years because it was too difficult to compete against contractors who allegedly cheated by only paying workers’ compensation for a small portion of their workforce.
He said they also would demand 6-day workweeks with no overtime. Smith said his bids took these costs into account, pushing his realistic construction estimates out of the competition.
Smith said in the last year he has found much union work for his employees.