The owner of a Mequon-based landscaping company was sentenced to six months in prison recently for not paying employees prevailing wages on public projects.
Last week Scott Devereux, owner of Cedarburg Landscaping Co., was sentenced by a judge in the U.S. District Court for Eastern Wisconsin to six months in prison, followed by three years of supervision upon his release. He was also ordered to pay $242,394.58 in restitution, $200,000 of which has already been paid.
Devereux was charged in January with falsifying payroll documents in order to pay his employees less than prevailing wages.
The charges came for a period between 2014 and 2015, during which time Cedarburg Landscaping saw a sharp increase in its work as a subcontractor on a number of projects commissioned by either the Wisconsin Department of Transportation or local governments, according to court documents.
Most of these jobs were paid for at least in part using money from the federal government, meaning they were subject to federal prevailing-wage requirements as established by the Davis-Bacon Act.
Devereux was found to be submitting weekly payroll reports to state agencies that understated the number of hours his employees worked on those projects, while overstating the hourly wage they had received. Investigators alleged his goal was to mask the hourly wage the employees were actually receiving.
Investigators interviewed ten employees, who said they spent as much as 80 percent of their time on public projects during this period. Although prevailing-wage requirements would have had them earning more than $40 per hour, the employees told investigators they were paid between $12 and $30 an hour, usually less than $20 an hour.
Devereux pleaded guilty to one count of mail fraud and one count of using false documents. A plea agreement states Devereux said he had to sometimes guessed at the number of hours his employees had worked and that he sometimes did not understand what hours were reportable.
Although mistakes are likely to occur in reporting on occasion, investigators found Devereux’s “underreporting of hours on prevailing wage jobs happened consistently, month after month in 2014 and 2015,” all of which directly benefited him financially.
In his sentencing memo, Devereux’s lawyer, Michael Fitzgerald, asked that his client be given only probation. In asking for the lighter sentence, Fitzgerald pointed out Devereux’s 30 years’ of experience in the landscaping business and said Devereux was a hard-working and productive member of society.
“Although it is fair to say that the prevailing wage law has been subject to criticism, in that it requires small business owners like Mr. Devereux to pay over $40/hour for landscape work that would otherwise
pay $15/hour, the fact remains that this is a federal law and Mr. Devereux violated it,” Fitzgerald wrote. “If a contractor does not want to pay the prevailing wage rate … then the contractor simply should not accept prevailing wage work.”