Labor Department probing big US homebuilders

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By MARCY GORDON
Associated Press

WASHINGTON (AP) – The Labor Department is investigating large U.S. homebuilders to see if they failed to pay workers the minimum wage or overtime.

A spokesman says the agency is investigating compliance with wage-and-hour laws in the homebuilding industry as part of a crackdown targeting several industries.

Labor Secretary Hilda Solis has made aggressive enforcement of wage-and-hour laws a cornerstone of her tenure since she took over the agency in 2009. The department has hired about 300 additional investigators to probe complaints of unpaid work, lack of overtime pay and minimum-wage violations.

Labor officials say so-called wage theft is especially prevalent among immigrant workers who speak little English or who fear challenging their bosses will jeopardize their immigration status.

One of the big homebuilders asked to provide documents in the probe is PulteGroup Inc. A company spokesman said Thursday that Pulte has received “a general inquiry.”

The Wall Street Journal reported that Lennar Corp., D.R. Horton Inc. and KB Home also received letters from the Labor Department asking for employee pay records. Those companies didn’t immediately return calls from The Associated Press.

In a copy of one such letter sent last month and obtained by The AP, the department’s Wage and Hour Division says the purpose of its investigation is to ensure that employees who work at builders’ home construction sites are being paid according to federal labor laws.

Specifically, the department wants to find out whether homebuilders are complying with the Fair Labor Standards Act, which spells out the requirements for pay and other work rules most employers must follow. To learn this, Labor investigators are seeking a trove of records, including employee time sheets and payroll and Social Security records, according to the letter.

The trade group Leading Builders of America said several of its members have received the letters. In a statement, the group called the requests “overbroad” and claimed they seek unrelated information.

“These demands could require significant resources and thousands of hours of work,” the statement said. The department’s inquiry is especially troubling given that no issues have been identified to warrant an investigation.”

For more than two years, the Labor Department has been investigating the hotel, restaurant, janitorial, health care and day care industries over similar issues. Department spokesman Carl Fillichio said Thursday that homebuilders are the latest addition to the list.

“We are actively looking at those industries that employ the most vulnerable workers and that engage in business practices, such as misclassifying employees as independent contractors, that result in violations of minimum-wage and overtime laws,” Fillichio said.

AP Real Estate Writer Alex Veiga in Los Angeles also contributed to this report.