In a pair of settlements announced within days of each other earlier this month, the District of Columbia Office of the Attorney General (OAG), has secured over $2.2 million from two construction companies that violated labor laws, illegally misclassifying hundreds of workers as independent contractors and depriving them of earned wages and benefits.
“D.C. workers are the backbone of our economy, especially at a time when the cost of living in D.C. continues to rise,” said D.C. Attorney General Brian Schwalb in a Dec. 9 press release. “I will continue to prioritize ensuring that workers receive the wages and benefits they have earned.”
“These practices hurt workers, families and communities by driving down wages and creating unfair competition from low-road contractors.”
– Baltimore-DC Building Trades Council President Greg Akerman
“These practices hurt workers, families and communities by driving down wages and creating unfair competition from low-road contractors.”
– Baltimore-DC Building Trades Council President Greg Akerman
Wage theft and employee misclassification are widespread problems in the Mid-Atlantic construction sector, according to Baltimore-DC Building Trades Council President Greg Akerman.
“These practices hurt workers, families and communities,” he said, “by driving down wages and creating unfair competition from low-road contractors.”
Christian Siding to Pay $725,000 for Prevailing Wage and Misclassification Violations
An extensive OAG investigation revealed that Christian Siding, a Virginia-based company specializing in building exteriors, failed to pay prevailing wages to workers on three publicly funded affordable housing projects across the District. These projects included The Ethel, Terrace Manor, and The Appleton — all initiatives aimed at providing housing for low-income seniors and families.
The investigation also found that Christian Siding illegally misclassified 229 workers as independent contractors on 13 additional projects between 2021 and early 2024. These misclassifications deprived workers of essential employee benefits, including overtime wages and paid sick leave.
On December 3, Schwalb announced a $725,000 settlement with the company. Under the terms of the settlement, Christian Siding will pay more than $364,000 directly to the harmed workers and $360,000 in penalties to the District. The company is also mandated to implement significant changes to its business practices and will undergo two years of compliance monitoring to ensure future adherence to the law.
“Failing to pay the required prevailing wage,” said Schwalb, “cheats both workers and D.C. taxpayers out of the full financial benefits of publicly funded projects. In D.C, legal accountability for prevailing wage violations extends all the way up the contracting chain — if your company or any of its subcontractors are underpaying workers, all of you can be held accountable. This settlement puts money back where it belongs and ensures that all construction firms in D.C. compete on a level playing field.”
“In D.C, legal accountability for prevailing wage violations extends all the way up the contracting chain — if your company or any of its subcontractors are underpaying workers, all of you can be held accountable.”
– D.C. Attorney General Brian Schwalb
“In D.C, legal accountability for prevailing wage violations extends all the way up the contracting chain — if your company or any of its subcontractors are underpaying workers, all of you can be held accountable.”
– D.C. Attorney General Brian Schwalb
Brothers Mechanical Inc. Settles for $1.5 Million Over Widespread Worker Misclassification
On December 9, the OAG announced another substantial settlement, this time for $1.5 million from Brothers Mechanical Inc., a construction company involved in large development projects in NoMa, Navy Yard, Buzzard Point and other D.C. neighborhoods
The investigation found that, from 2020 to the present, Brothers Mechanical and its subcontractors systematically misclassified approximately 500 construction workers as independent contractors.
This widespread misclassification deprived these workers of fundamental employee rights and benefits, including overtime pay for hours worked over 40 per week, paid sick leave, proper tax classification (which shifted the tax burden to workers), and access to crucial safety net programs like unemployment insurance and workers’ compensation.
A D.C. apartment complex at Buzzard Point in 2020. Photo: Antony-22, CC BY-SA 4.0 via Wikimedia Commons.
“When companies illegally label employees as independent contractors, or misclassify them to a lower standard, they avoid paying proper wages, benefits, workers’ compensation and payroll taxes,” said SMART Local 100 Marketing Director Chuck Sewell. “This is all too common in the construction industry, and creates an uneven playing field where law-abiding contractors, who invest in trained workers and follow all regulations, are undercut by those cutting corners,”
To resolve the OAG’s findings, Brothers Mechanical will pay $500,000 to the impacted workers and $1 million in penalties to the District. The company is also required to overhaul its subcontracting practices, including mandating certified weekly payrolls from subcontractors and randomly auditing these records on D.C. projects. Brothers Mechanical will face three years of compliance monitoring to ensure lasting changes.
“These settlements are big wins for workers,” said Akerman. “We applaud the D.C. Attorney General’s office for its focus on this issue and its pro-active approach to dealing with contractors who break the law and attempt to cheat hard-working employees.”
The D.C. OAG encourages any workers who believes their rights have been violated or that they may have experienced wage theft to come forward. You can contact the OAG by calling (202) 724-7730 or emailing workers@dc.gov (or trabajadores@dc.gov for Spanish speakers).