City accused of paying unfair wages |

City accused of paying unfair wages

Susan Wood

Two California labor agencies are investigating whether alleged unfair labor practices occurred during the revamp of the Village Center near Stateline.

The California Labor Agency, which oversees the Department of Industrial Relations, is investigating if public funds from the city were used at the project site to establish if contractors should have been paid prevailing wages.

The investigation was sparked by complaints by union contractors, who filed their own claim with the Department of Labor Standards and Enforcement.

A preliminary DIR labor commissioner’s report obtained by the Tahoe Daily Tribune indicates an audit found 139 subcontractors were each paid between $7 to $10 an hour for work in 2002 at the site. With prevailing wage standing at $35 an hour, the difference could add up to $1,400 per subcontractor in back wages per seven-day work week, according to the report, written by a lead deputy labor commissioner.

The audit report was issued and filed with the director’s office of the DIR.

“There were no public funds used under the labor code that would substantiate this kind of determination,” South Tahoe Redevelopment Agency legal counsel Lee Rosenthal said.

The project – situated at the intersection of Park Avenue and Highway 50 – is located across from a $250 million redevelopment site where two Marriott hotels anchor a retail complex. South Lake Tahoe government funds were used in a public-private partnership there.

The city, Redevelopment Agency, its Bay Area counsel and shopping center operators Hackett Management of Los Angeles also deny public funds were drawn to make improvements on the $25 million project.

The city had once allocated about $1 million to put in landscaping at the project site, but it backed out. The city’s only two known connections to the area are sparse. About $200,000 was spent nearby on retention ponds to catch the water runoff, and an agreement between Hackett Management and the city Parking Authority was made that binds the city to pay for enforcing parking patrol – a hotbed issue.

Rick Rice, California Labor Agency assistant secretary, said the state handles every investigation on a case-by-case basis. This one was generated by the Labor Commission. The state will determine whether the project is a public works job and therefore would make the South Tahoe Redevelopment Agency liable. Investigators have been sifting through boxes of documents to get to the bottom of the case, which has occupied the state for two years, Rice said.

“We have to look at every aspect of the case,” Rice said, further admitting a determination is not expected any time soon.

In many cases, the state cross-references the documents with the labor code. The investigation launched in April 2003 will evaluate eminent domain cases in the area in question as well as the use of volunteers on the job.

The shopping center revamp was managed by Moorefield Construction of Los Angeles.

Suspicions were raised of alleged unfair labor practices when a claim was filed with the California Department of Labor Standards and Enforcement on behalf of workers in Carpenter’s Union 1789.

Local union members have been protesting in front of Raley’s at the Village Center by handing out fliers complaining of unfair labor standards. They claim the “Tahoe Crescent Partners” paid $46.08 take-home pay for eight hours labor,” the flyer said.

Management at Alpine Metals, a vendor at the site, reported its pay far surpassed $46 a day.

“My lowest paid person makes at least twice as much as what they’re saying,” said Jim Warnick of Sierra Drywall, another South Lake Tahoe contractor on the job over the last seven months.

Local union members declined to go on the record regarding the matter.

But union regional representing counsel, Paul Cohen, said the contractors are due overtime – without elaborating over the basis of this argument.

“We believe our workers are entitled to back pay,” he said.

The union also takes issue with Moorefield using out-of-town subcontractors.

“I think it’s detrimental to the local economy when contractors bring in out-of-the-economy workers,” he said from his Oakland office.

But Larry Moorefield, who runs the Los Angeles-based company, claimed several attempts were made to hire local workers, but they weren’t available.

“I don’t know where they get the $46,” Moorefield said, adding he couldn’t say what exactly what the paid wages amounted to. “It’s sad about the whole situation.”

– Susan Wood can be reached at (530) 542-8009 or via e-mail at

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