Paul Bass Photo
Workers examining the stop-work orders on Howe Street Monday.
The developer of a soon-to-open apartment-retail building at Chapel and Howe streets vowed to make “right” a slew of alleged labor violations — which he said the state might have cited in error.
“If our subcontractor is out of compliance, we’re going to make it right,” said the developer, Randy Salvatore (pictured at right). “But what I’m being told now, it’s a paperwork issue.”
Either way, he said, “We will do the right thing.”
Salvatore made the remarks after a state Department of Labor wage and workplace standards inspector slapped five separate stop-work notices Monday morning in the window of the Novella. That’s the nearly-completed 53,000-square-foot project Salvatore’s RMS Construction is building, with 136 new apartments and some 4,500 square feet of retail storefronts.
The labor department last Friday also issued a stop-work order at a Yale University Properties construction project at 9 Dixwell Ave. for concealing payroll, misclassifying employees as independent contractors, and failing to obtain worker’s compensation insurance. The New England Regional Council of Carpenters plans a demonstration at that site Tuesday over the allegations; it plans to bring along “Scabby” the “gigantic rat” and a 12-foot-tall inflatable “Fat Cat.” Associated Construction of Hartford is renovating 18 upstairs apartments there for Yale. (A smoothie shop is going into one of the two storefronts.) Associated Senior Project Manager Maurice Gowendo told the Independent Monday that “a sub of a sub — a third-tier sub of mine” handling taping sheetrock was responsible for the problem, paying workers in cash. Associated promptly fired the sub-subcontractor, according to Gowendo; and work is continuing toward an anticipated July 15 completion date.
Meanwhile, plumbing and HVAC crews remained on the job at Salvatore’s Novella Monday, working on finishing touches for another anticipated July 15 opening. Agents were showing the apartments to prospective tenants.
But crews from five subcontractors had to go home for now because of the stop-work orders: New Walk Home Inspection of Lake Hiawatha, N.J.; Sky’s Construction of Waterbury; CKA Drywall of Stamford; Flooring Source of Stamford; and Anthony’s Closet of Little Ferry N.J.
The labor department accused three of the firms of paying people in cash; and three of showing no proof of insurance. (One outfit faced both charges.)
Investigators were in the area due to the large amount of construction taking place in New Haven, and the ongoing support of the city and the New Haven police department,” reported labor department spokeswoman Nancy Steffens. “They plan to focus on this area, so they were there today after noting the Novella Apartments complex on Friday …
“These subcontractors can start work again once they have met with the agency to show they have insurance and/or acceptable payroll records that show they are paying the proper taxes and wages. When employers are not playing by the rules, honest employers are hurt, employees are hurt, and the state experiences lost revenue. In cases of no insurance, if a worker is hurt while on the job and there is no insurance, ultimately, the state, and our residents, shoulder these costs.”
In a telephone interview, Salvatore said his staff checked in with the subcontractors after Monday morning’s citations. He said the four his staff reached reported that they in fact do follow the rules and have the paperwork to prove it.
Salvatore said his company has subcontractors sign 20-page contracts that detail all the legal obligations, including worker’s compensation. It turns out these subcontractors subsequently sub-subcontracted some of the work.
“We need to get this right,” Salvatore said. “The shame of the process is, if they do have the proper paperwork as they’re saying, now you have workers who were sent home for a day or a couple of days through no fault of theirs. If they’re not in compliance, that company won’t work for us again. That’s not the way that we operate.”
Salvatore added that he agreed to use union labor for the framing on his project. “It was a significant cost to me. I looked it as my contribution to the community because I’m being allowed to develop in this area,” Salvatore said. He estimated that 95 percent of the 250 people who have worked on building the Novella live in Connecticut.
Ted Duarte, a senior organizer with the carpenters union, confirmed that Salvatore hired union workers. “We worked together on that project as far as the framing goes,” Duarte said.
He said the labor violations cited Monday reflect a common problem: subcontractors winning jobs through “ridiculously low bids” with the idea of hiring shady sub-subcontractors after contracts on a project have been inked.
“It’s just rampant in the industry, classifying workers as 1099 so workers can avoid workers comp and payroll taxes and everything that comes with having an employee,” Duarte said. That’s how subs sometimes get work with “ridiculously low bids” by subcontracting to outfits who bring in undocumented immigrant workers.
“They are the most exploitable workforce there is. A lot of these unscrupulous contractors do that. They’ll exploit the undocumented, anyone,” Duarte said.
Associated Construction’s Gowendo said that abuse is sometimes hard for general contractors to spot in time.
“We try to check up and down, back and forth. We’re not there every day when an employee receives a paycheck,” he said. “As soon as we hear about something like that, we sever the relationship. Sometimes we do it before the Department of Labor gets there.”
53,000 minus 4,500 = 48,500 ÷ 136 = 356.6 square ft. per apt. Account for hallways, stairwells, common spaces and equipment rooms, the average size of an apartment in this building is somewhere near 300 square ft, studios smaller and 2BRs larger. Rents range from $1450 to $3000 and nowhere is there a mention of heat included in the rent. In fact the multitude of gas meters and the forced air heating would indicate that heat would be the tenants responsibility.
Draw your own conclusions.