Attorney General Karl A. Racine recently announced that Power Design, Inc., a national electrical contractor headquartered in St. Petersburg, Fla., will be required to pay $2.75 million to workers and the District as part of a settlement in a wage theft and worker misclassification case. The settlement with the Office of the Attorney General (OAG) resolves a 2018 lawsuit against Power Design and two subcontractors that staffed its worksites for allegedly misclassifying more than 500 electrical workers as independent contractors instead of employees to cut labor costs. OAG also alleged that Power Design cheated workers out of wages and benefits and failed to pay District unemployment insurance taxes.
Under the terms of the settlement, Power Design will be required to:
· Pay $879,056 in back wages to workers who did not receive minimum wage, were not paid overtime wages, or were denied paid sick leave.
· Pay $1,820,944 to the District.
· Pay $50,000 to support apprenticeships, job training, or workforce development opportunities to District residents.
· Implement new policies and procedures to ensure compliance with the District’s minimum wage, overtime, paid sick leave, and worker misclassification laws.
Read a copy of the Consent Order here.
For additional information on worker misclassification issues, read “Sorting Out Misclassification” by Tom Zind from EC&M’s November issue.
