84 Lumber agreed to pay over $725,000 as part of a settlement with the California Department of Industrial Relations' (DIR) Division of Labor Standards stemming from a 2009 investigation of labor practices at a state university construction site.
The total payment covers $726,063.24, of which $564,938.24 is for outstanding wages and $161,125 is for related penalties. The investigation involved the Tercero Housing Project at the University of California, Davis. 84 Lumber was originally hired by the project's general contractor, Brown Construction, to perform framing work on the building. 84 Lumber, in turn, subcontracted the work out to Russell/Thompson Inc., a Redding, Calif.-based company.
"This settlement will make available wages that should have been rightfully paid to workers," said Julie Su, labor commissioner. "It also sends a strong message that on public works projects, prime contractors will be held responsible when their subcontractors fail to follow labor laws."
The investigation found that the subcontractor failed to pay overtime and misclassified workers by identifying them as lower skilled workers rather than as the higher skilled positions they actually worked. A June 2010 decision by the labor commissioner ordered Russell/Thompson to pay $1.3 million in back wages and $200,000 in fines. After the decision a civil wage and penalty assessment was served against 84 Lumber and Brown Construction.
The Eighty Four, Pa.-based dealer was one of four contractors fined to wage violations at the Tercero Housing Project at the University of California, Davis.
Two other subcontractors from the project, Kings Drywall and JL Home Development, were also ordered to pay more than $1.3 million in back wages as a result of the investigation.
"This public works project represents a considerable investment of public funds, and contractors on these projects must be held accountable," said DIR acting director Christine Baker.
84 Lumber is ranked No. 5 on the ProSales 100 with 2010 sales of $1.4 billion. It operates roughly 250 stores throughout the country. The company did not comment for the story.