Minnesota lawmakers propose stricter construction worker wage theft laws
Abel Sustaito said at a press conference last year that he was owed thousands of dollars for his work on the Viking Lakes project. Photo by Max Nesterak/Minnesota Reformer.
The Minnesota House is considering enacting a new law to ramp up protection for workers after stories of wage theft have peppered the state’s construction industry.
In an effort to step up pressure on subcontractors that exploit workers, the bill would target general contractors and project owners that hire the subcontractors.
Contractors often hire subcontractors one on top of another, insulating themselves from wage theft claims. Advocates say the construction industry is purposely structured to stymie workers’ wage theft claims. Many construction workers are also immigrants who may struggle to understand the murky reporting structure.
“This is a business model that’s been set up for the purposes of profiting from the exploitation of (a) largely immigrant construction workforce,” said Rep. Sandra Feist, DFL-New Brighton. “This bill provides that recourse to these workers who have been victimized by wage theft contractors.”
The bill (HF1859) allows workers to file civil lawsuits against contractors for their unpaid wages and gives the state’s Department of Labor and Industry power to inspect employment records related to wages.
Feist, the bill’s chief author, said the legislation would create incentives for contractors or project owners to hire subcontractors who are less likely to commit wage theft and other abuses.
Last year, the Reformer broke the story of dozens of construction workers claiming wage theft while working on the Minnesota Vikings owner’s development in Eagan, Viking Lakes. The workers were mostly undocumented immigrants.
In 2019, Minnesota passed what was heralded as one of the toughest wage theft laws in the country. The law made stealing more than $1,000 in wages a felony subject to up to $100,000 in fines and 20 years in prison. As of late last year, just one person had been charged (but not convicted) with felony wage theft.
On Thursday, two construction workers testified in Spanish with interpreters about how they felt their hard work was exploited by companies, saying many of their coworkers have clocked in 12-hour days without pay. They testified that their complaints about wage theft or safety concerns are often ignored or bounced around from one subcontractor to another.
Opponents of the bill, mostly contractors and the organizations representing them, said the legislation would hurt the construction industry in Minnesota by increasing costs and over-burdening smaller, family-owned contractors.
“This bill shifts legal responsibility for the criminal actions of downstream contracting partners onto the upstream general contractors regardless of the general contractor’s fault,” said Tim Worke, CEO of Associated General Contractors of Minnesota.
Feist and the bill’s advocates said contractors can research the past actions of their subcontractors, so they could choose reputable subcontractors rather than merely the cheapest.
“The bottom line is that if you control the worksite, then you can prevent wage theft. If you have access to the information on reputations and past actions of the possible subcontractors, you have control over wage theft,” Feist said.
The bill passed the House Labor and Industry Finance and Policy Committee by a 9-3 vote Thursday and was referred to the House Judiciary Committee.
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