Thursday, March 26, 2009

Contractor Admits to Underpaying Employees

Failed to Pay Prevailing Wages on City Projects

A Brooklyn electrical contractor has admitted to cheating ten employees out of more than $1 million in wages on six public works projects funded by the city.

Arie Bar, 57, of Long Island, owner of AAR/Co Electrical, Inc. of Brooklyn agreed last Friday to provide back pay to the 10 former employees who were not paid prevailing wages, which are established by the City Comptroller to reflect the predominant rate of wages and benefits for workers in each of the construction trades.

The corporation pleaded guilty in Queens Supreme Court of six counts of second-degree grand larceny, two counts of third-degree grand larceny, 63 counts of first-degree falsifying business records, 63 counts of first-degree offering a false instrument for filing, 228 counts of making a punishable false statement and 29 counts of failure to pay prevailing wages. In addition, Bar personally admitted to one count of failure to pay prevailing wages.

In addition to making restitution of $1,019,553, Bar and the corporation are not eligible to submit a bid on or be awarded any public work contract or subcontract with the state, any municipal corporation or public body for five years.

“The failure to pay prevailing wages is a prevalent problem all over New York and in Queens, in particular, due to our large immigrant population,” said Queens District Attorney Richard Brown. “Many immigrant workers who come to the United States with skills, like electrical work, are forced to work for private contractors for far below prevailing wages.”

Brown said that in this case, Bar and his corporation are accused of paying the workers between $20 and $30 per hour less than the prevailing wages. In addition, they were not provided with any benefits. “The end result is that the workers are put in the difficult position of complaining and losing their jobs or staying silent and being taken advantage of,” added Brown. “This guilty plea and penalty should serve as a warning to those who would cheat employees out of fair wages that this behavior will not be tolerated.”

The investigation into AAR/Co began several years ago after the city Department of Design and Construction informed Thompson’s office that electricians working for AAR/Co on a city project at the Queens Botanical Garden were not being paid prevailing wages. The comptroller’s office expanded the probe to include all AAR/Co projects from April 2004 to August 2007 and found that Bar had falsely certified payrolls for the ten workers at various city work sites, including Queens Hospital Center, Fort Greene Park and the Wards Island water treatment plan. Bar falsely claimed that workers were being paid $73 an hour as required by state labor law, when they were actually being underpaid.

After learning that Bar threatened and fired workers who had filed labor law complaints, Thompson brought the case to Brown’s attention in 2007. “Contractors should think twice before cheating workers out of prevailing wages, or they could face serious consequences like Arie Bar and AAR/Co Electrical, Inc,” said Thompson.

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