Message from the President CEO ABC Keystone March 2021

By: G. David Sload, President-CEO, ABC Keystone

WARNING! Failure to Follow Directions, Knowingly or Unknowingly, Could Lead to Criminal Charges Being Filed!

The PA Prevailing Wage Act has been in existence for over sixty years. Since the law’s inception, an employee who believes they are being paid incorrectly on their work task classifications or on the fringe benefits is able to file a complaint with the Department of Labor & Industry.

With one decision, the above-described process has been totally upended. For the first time ever, an employee complaint on a Pennsylvania prevailing wage job has led to the filing of criminal charges and an employer being found guilty and sentenced to jail time. Put very simply, a couple of employees decided to go to the local District Attorney and claim wages were being stolen from them due to erroneous job classifications. The case was then taken on by the State Attorney General’s office. For the last four plus years, ABC Keystone has been supporting Scott Good in the case of Commonwealth of Pennsylvania vs. Goodco Mechanical.

My purpose here is not to dissect the case, but to warn members about the ramifications of the Superior Court’s ruling. Those of you who perform prevailing wage work have become accustomed to prevailing wage audits. If everything is in order, no harm no foul. If the Department of Labor & Industry finds any issues, you are required to make any aggrieved party whole and if the error was unintentional, you mainly receive a warning to not let it happen again. If the violations appear to be intentional, you will be disbarred from bidding on prevailing wage work for a number of years. Until now, these matters have been civil and not criminal.

With the Superior Court Ruling, essentially any disgruntled worker who believes you misclassified them on a project can file a claim with their County District Attorney for theft by deception, receipt of stolen property, or failure to make required disposition of funds received. Please understand these are criminal charges and can include restitution, fines and jail time. Avoid these claims by properly classifying employees and properly handling overtime pay and fringe benefits.

Prevailing wage work can be complex and full of scenarios. If you have a carpenter and he jumps on a backhoe to dig a trench, he now becomes a heavy equipment operator – two distinct and different pay classifications. If an employee works part of the week on prevailing wage work and the balance on private work and ends up with more than 40 hours, how is overtime computed? How do you carve out the fringe benefits you provide the employee and how do you have to distribute the balance of the fringe wage?

Make sure you can answer these and many other questions surrounding the Prevailing Wage Act. If you don’t know or need a refresher, talk to your attorney. If your attorney is not familiar with the Prevailing Wage Act, reach out to us at ABC. As a result of this ruling please stay tuned for upcoming seminars on this subject.

Don’t guess. Get the answers. Don’t get charged. Stay out of jail!

G. David Sload
G. David Sload
ABC Keystone President-CEO

Posted April 3, 2023