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Worker advocates urge developers to fight wage theft

The CTUL co-director Merle Payne, left, and Pedro Carbajal, a CTUL member and construction worker, talk about the Building Dignity and Respect program to fight wage theft on Thursday. (Photo by Brian Johnson)

BridgeTower Media Newswires

Daniel Sanchez thought he was onto something good about 10 years ago when he landed a job as a post-construction cleaner for a subcontractor in Minnesota, but it wasn’t long before the red flags started going up.

Sanchez, a native of Mexico and a 24-year resident of Minnesota, said he was paid in cash and “that’s when things starting getting really wrong. I could tell something was up. That was the moment I realized that something was wrong.”

Sanchez now contends he was short-changed by his employer and is still owed $110,000. And he says he’s not alone.

“I’ve seen a lot of other workers in the industry experience wage theft,” Sanchez said through an interpreter this week. “You know, some people think it only happens to certain people. But wage theft happens to white folks, to Black folks, to Latinos and Somalis. It’s something that affects a lot of workers.”

Sanchez is among those calling for local developers to join the Building Dignity and Respect program, a newly established effort to fight wage theft and other abusive practices in Minnesota’s construction industry.

Advocates for the program — including construction workers, a local minister and Minnesota Attorney General Keith Ellison — said Thursday that the goal is to ensure fair pay for workers and safe working conditions.

CTUL, a Minneapolis-based workers’ rights organization, says the program is patterned after the Worker-driven Social Responsibility (WSR) model, which has “transformed working conditions” in agriculture and other industries. Participating developers sign a legally binding document to uphold “human rights standards” on their projects, according to CTUL.

Contractors that don’t live up to the standards will “no longer be able to work for developers that participate” in the program, said Doug Mork, director of the Building Dignity and Respects Standards Council, a Minneapolis group charged with implementing the program.

Merle Payne, co-director of CTUL, said developers can ensure “basic dignity and respect for workers” or they can continue “business as usual, maintaining an industry with rampant wage theft, dangerous working conditions and — at the extreme — labor trafficking.”

Wage theft is a nationwide concern. In fiscal year 2021, investigators identified more than $36 million in back wages owed to about 21,000 construction industry workers across the country, according to the U.S. Department of Labor.

As Finance & Commerce has reported, migrant workers are seen as easy pickings for violations because they tend not to complain for fear of retaliation.

Abusive practices include the use of subcontractors and “labor brokers” who pay workers off the books to avoid payroll taxes, workers compensation insurance, and other expenses — and are willing to compromise safety in the process.

Despite a 2019 state law that aims to crack down on wage theft in Minnesota, and provided more than $3 million for enforcement, the practice of shortchanging workers — and other abuses — continues to be “rampant” in the non-union construction industry, according to CTUL.

Speaking during a press event at CTUL’s headquarters, just a block north of George Floyd Square in Minneapolis, Ellison said that the state’s anti-wage theft program has returned “thousands and thousands of dollars” to “hundreds of workers.”

“It is my hope that I don’t have to come knocking on your door. I don’t want to,” Ellison said. “But if I get reports that workers are being stolen from and we can prove that it’s true, we will take enforcement action. We will, because it is theft.”

CTUL says it has reached out to about a dozen Twin Cities developers so far, but only one — Yellow Tree Construction — has agreed to sit down and talk, the organization said. Finance & Commerce also reached out to developers to comment on the program.

Abby Alldaffer, a project manager in real estate development with Seward Redesign, a nonprofit community developer, said fair treatment of workers is at the heart of the best development projects.

“I always say that you can see it in the building,” Alldaffer said at the press conference. “If at the end of the construction process, you are left with a building that is shoddily constructed, there is a good chance that workers weren’t given enough time, training or support to do the job.

“And that is on us as developers to make sure the project team is given their best chance to do their best work.”

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