States are increasingly taking steps to impose joint and several liability on general contractors in cases in which project subcontractors fail to pay their workers what they are owed. This effectively puts contractors on the hook when their subcontractors do not pay their employees proper overtime or other compensation. New York is one example of this, with other states following closely behind. The Lore Law Firm examines this trend and what it means for workers.
New York Takes the Lead in Protecting Construction Workers’ Wages
Joint and several liability essentially makes all defendant employers in a lawsuit liable up to the full amount of damages. A good example of this recently took place in New York, which passed a law that automatically makes general contractors jointly and severally liable for the wages, benefits, and supplements owed by subcontractors to their workers. The unpaid worker will be able to recover their unpaid wages from the general contractor, and will not be required to prove that the general contractor employed, or jointly employed, them.
This rule imposes a direct liability link between the general contractor and the construction worker and allows for a faster route to regaining improperly withheld compensation. However, the joint employer status that is effectively created by this law – rendering both the general contractor and subcontractor obligated to the employee – is for the limited purpose of recovering the employee’s unpaid wages.
Other states are enacting legislation along the same path that New York has tread. For instance, California, Oregon, Nevada, Maryland, and Virginia have passed some form of legislation that resembles that of New York. Under these various laws, some states directly prosecute the workers’ wage claims while others allow the worker to pursue a private cause of action by hiring their own lawyer.
Why These Laws Are Important for Workers
Making general contractors liable for their subcontractors’ failure to pay workers is the result of decades of consistent efforts to prevent this pervasive form of wage theft. Supporters of these laws have pointed out that general contractors tend to be financially well-established and profitable businesses. This is in contrast to construction workers who lack the resources of their employers and, in some cases, are vulnerable due to their undocumented citizenship status. Putting the obligation on general contractors, therefore, levels the playing field and helps prevent exploitation.
Historically, having layers of subcontractors between the worker and the general contractor has benefited everyone but the worker. Each tier of subcontractor was free from any legal liability to the next, which made it much more difficult for workers to reclaim lost wages. Joint and several liability puts both subcontractors and general contractors on the hook for employee pay and thereby forces everyone to be accountable.
How The Lore Law Firm can help
Our wage and hour attorneys work every day to ensure that workers across the country are paid fairly and accurately for the work they do. We are monitoring laws like the ones recently enacted in New York and elsewhere so we can stay on top of the latest changes affecting employees and employers alike. If you’re not being paid fairly or accurately for your overtime work, it’s time to consider speaking with our team. You can fill out our free and confidential client intake form to learn more about your legal options. Connect with The Lore Law Firm today.