Houston ISD and Wage Theft - Part II

Employee misclassification and wage theft continue to be a serious problem that affects individuals, businesses and the Texas economy. Earlier this month, I wrote about an incident of wage theft that involved Houston Independent School District (HISD). The story centered around two people, Marvin Mundo and Marciano Cruz.  These two men had worked on projects for Jane Long Middle School and Sharpstown High School.

Construction Citizen has written a couple of follow up stories - keeping up with what has developed since the original story was written. According to the March 15th story, workers and concerned parents have spoken out at recent school board meetings.  HISD trustees have become aware of the issues of wage theft and payroll fraud which costs taxpayers in the form of cost overruns.  The HISD Construction and Facility Services Department and the HISD Business Assistance Department have begun work to restore confidence and raise the standards and accountability in the job bidding processes.

HISD pledges to make improvements in the following areas:

  • Reporting mechanisms: Create a hotline for employees and contractors to call for assistance and to report issues on the job 
  • Dispute resolution: HISD plans to release a request for proposals to establish a third-party ombudsman approach to construction and building disputes  
  • Accountability for Subcontractors: General Contractors will be limited to a short list of approved reasons for switching out subs after the bid has been approved, and HISD will not accept bids containing “pass-through” expenses – project dollars paid to companies who do not actually do any of the work on the project.

See ConstructionCitizen.com for more information on this story.  In the meantime, Mundo and Cruz are still awaiting payment.  It does appear, however, that HISD will no longer do business with Lawman Construction.

In a related story, Construction Citizen reported this week about the Wage Theft issue being brought before Houston City Council.  This week, Stan Marek, CEO of Houston based Marek Family of Companies, joined with Kim Bobo, author of Wage Theft in America to stand before the Houston City Council public session to discuss wage theft.

The purpose of the testimony was to help council members be aware of how these issues can impact city construction jobs and contracts.

Houston City Council Member, Wanda Adams, presented a proclamation against wage theft and pledged to help make Houston a city where Wage Theft and Payroll Fraud are not accepted practices. Following the council testimony, a rally was held on the steps of City Hall.  There are more photos from that rally at teh Down With Wage Theft Campaign website.

These efforts mark the beginning of a campaign to help pass legislation in the 2013 legislative session to clamp down on wage theft and employee misclassification. Good legislation was blocked from passing in the 2011 session. Republicans need to get behind this issue as it affects families and prevents legitimate businesses from obtaining contracts which expand employment in Texas.

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