BOSTON – As a result of lengthy civil contempt litigation by the U.S. Department of Labor against two Massachusetts construction companies and their officers, the U.S. District Court for the District of Massachusetts has approved the distribution of $1.8 million from court-ordered real estate sales and additional funds to 478 workers who were employed by Force Corp., AB Construction Group Inc., Juliano Fernandes and Anderson dos Santos.
After an investigation by the department’s Wage and Hour Division found that the companies, Fernandes, and dos Santos had misclassified the affected employees as independent contractors, the department obtained a 2016 consent judgment and order, which restrained the defendants from withholding $1,179,842.55 in back wages and ordered them to pay an equal amount in liquidated damages, plus interest.
After the defendants failed to comply with certain terms of the consent judgment and order, the department secured a 2020 contempt order appointing a special master to examine the finances of all four defendants, Fernandes’s wife, and five related non-defendant entities, including Turn Key Lumber Inc. Subsequently, the court appointed the special master as receiver to take possession of and sell three real properties owned, controlled, or used by Fernandes, his wife, or Turn Key. Following the sales, the special master/receiver had over $1.7 million in real estate proceeds available for distribution.
Western Surety Co., a bond company with liens on the properties, contended it had priority over the real estate sale proceeds, as well as over additional funds from Fernandes. After extensive negotiations, the parties agreed to distribute a total of $1.8 million from the sale proceeds and additional funds to the department for the affected workers. The defendants previously remitted $547,900 to the department for the workers.
“This case shows that the U.S. Department of Labor will aggressively pursue wages and liquidated damages that are often owed to low-wage workers, including through judgment enforcement actions such as contempt proceedings,” said Solicitor of Labor Seema Nanda. “The employer community should be aware that we will not only actively pursue judgments against those who violate wage and hour laws, but we will also use the legal tools at our disposal to collect on judgments.”
“Misclassification of employees as independent contractors can rob workers of their full wages and critical benefits and lead to violations of the Fair Labor Standards Act,” said Jessica Looman, Principal Deputy Administrator of the Wage and Hour Division. “Combatting misclassification of employees is a priority for the Wage and Hour Division, and we will hold to account any employer who attempts to cut labor costs, transfer tax burdens, or undercut the competition by misclassifying workers and denying them the wages and protections they are due.”
“In the years since this case began, some workers have moved, are unaware of the back wages, or may otherwise be uncertain about claiming the monies due to them. Partnering with the Wage and Hour Division, Boston-area community and worker advocacy groups – including the Brazilian Women’s Group, Brazilian Worker Center, Brockton Workers Alliance, Centro Comunitario de los Trabajadores, La Colaborativa (formerly known as Chelsea Collaborative), Fuerza Laboral, Metrowest Worker Center-Casa and the Massachusetts Coalition for Occupational Safety and Health – have been instrumental in connecting unlocated workers to the Wage and Hour Division,” said Wage and Hour Division District Director Carlos Matos in Boston.
The organizations and their contact numbers are:
Brazilian Women’s Group/Grupo Mulher Brasileira (Allston): 617-202-5775
Brazilian Worker Center/ Centro Do Trabalhador Brasileiro (Allston) 617- 783-8001
Brockton Workers Alliance (Brockton) 508-484 – 8358
Centro Comunitario de los Trabajadores (New Bedford) 774-961-8283
La Colaborativa (Chelsea) 617-889-6080
Fuerza Laboral (Central Falls, RI) 401-725-2700
Metrowest Worker Center-Casa / Casa Do Trabalhador MWC (Framingham) 508-532-0575
Massachusetts Coalition for Occupational Safety and Health /MassCOSH – (East Boston) 617-505-8939
For more information about laws enforced by the Wage and Hour Division, contact the Boston District Office at 617-624-6700 or the toll-free helpline at 866-4US-WAGE (487-9243). Calls can be answered confidentially in over 200 languages regardless of immigration status. Or, visit the division online for more information, including a search tool to use if you think you may be owed back wages collected by the division and guidance about the difference between an employee and an independent contractor. Help ensure hours worked and pay are accurate by downloading the department’s Android Timesheet App for free.
Learn how to dispel some of the pervasive myths about misclassification.