Construction firms owe $1.1 million in back pay

The Chicago Regional Council of Carpenters said Monday the developer and subcontractors that built a senior living center in Northbrook have been ordered to pay $1.1 million to employees for violating state law on prevailing wages and benefits.

The Illinois Department of Labor, responding to charges the council filed, ordered the back pay for employees who constructed the Lodge of Northbrook, a 164-unit facility at 2150 Founders Drive, Northbrook. The project benefited from bonds issued by the Illinois Finance Authority, making it subject to the state’s Prevailing Wage Act.

The department late Monday confirmed details of the order in response to a request under the Freedom of Information Act. The documents indicated the decision became final in December.

Executive Secretary-Treasurer Gary Perinar of the carpenters council said the back pay award is the largest in its history. He said many workers will receive thousands of dollars paid out over a year.

“We have a new department dedicated to combating wage theft and are putting unscrupulous contractors on notice that cheating workers and taxpayers will not be tolerated,” he said. The council is a part owner of Sun-Times Media.

Chicago Regional Council of Carpenters

The Department of Labor order primarily hit two subcontractors, Horizon Carpentry of Marengo and Russ’s Drywall of Elgin. Horizon was ordered to pay $692,000 and Russ’s is required to pay $249,000. The developer, Essex Communities of Omaha, Nebraska, was ordered to pay $188,000. The subcontractors did not immediately reply to requests for comment and a general counsel at Essex declined to discuss the matter.

Perinar said the council filed its charges in 2018, during the term of former Gov. Bruce Rauner. No action was taken until Gov. J.B. Pritzker assumed office, he said.

“Wage theft and the loss of tax revenue affects everyone,” Perinar said. “It takes advantage of workers, many of whom are unaware of their right to receive fair wages and benefits for themselves and their families. It puts signatory union contractors at a disadvantage for competitively bid projects. And it cheats communities out of tax dollars to increase future growth, new projects and public services. Thanks to our research team for discovering this injustice and to the Department of Labor for enforcing the law.”

For construction projects that are public works or receive public financing, the Prevailing Wage Act requires contractors and subcontractors to pay laborers, workers and mechanics the rate of wages and benefits that applies in the county where they are working.

Perinar said the council’s complaint also named the general contractor, McShane Construction, but no penalty was levied against the firm.

His group represents more than 30,000 people from 19 local unions across Illinois and Eastern Iowa.