Carpenters' union alleges unfair labor practices
By Tom Baldwin • GANNETT STATE BUREAU • March 21, 2008



TRENTON — A New Jersey carpenters' union is suing a Texas-based developer for allegedly employing undocumented workers and denying them benefits by classifying them as independent contractors and not employees, it was announced Thursday.

"This is the most blatant abuse of laws I have seen in a long time," said Albert Kroll, a former state labor commissioner who represents the carpenters in their case against D.H. Horton Inc., which calls itself "America's Builder."

"It's our policy not to comment on pending litigation," said spokeswoman Jessica Hansen from the builder's headquarters in Fort Worth. Aside from the suit, she refused to comment on whether the company used "employees" or "contractors."

An employee relies on an employer for pay and benefits and to deduct taxes. State and federal governments also rely on employers to deduct taxes. A contractor pays one's own taxes and buys a benefits package.

So Kroll and the 17,000-member New Jersey Council of Carpenters allege the practice denies New Jersey hefty sums.

The Council of Carpenters filed the suit Wednesday in Middlesex County, alleging Horton violated the state's Construction Industry Independent Contractor Act, made law only last July, as well as federal racketeering laws.

"This illegal hiring scheme is quite simple," said Kroll, saying Horton hired asubcontractor who would hire undocumented immigrants and label them contractors, paying them $8 to $14 an hour in a market where the going pay is $21 to $23 an hour, according to Tom Canto, executive secretary and treasurer of the carpenters' group.

The suit seeks financial rewards, for the company to stop its practices and for Horton to pay for all the lawyers. The suit also says the Horton's subcontractor paid workers in cash to avoid reporting overtime.

Kroll said the state Department of Labor and Workforce Development had audited 2.2 percent of employers in 2006 and found 25,000 employees wrongly classified. He said that cost New Jersey some $15.9 million in under-payments to the unemployment and disability insurance funds.

"Part of the problem is the inability to speak English and understand it," said Kroll of the workers.

"They are taken advantage of," said former Assemblyman Wilfredo Caraballo, D-Essex, who had sponsored the independent-contractor law.

The suit says the issue came up at Horton's Plaza Grande residential job at the old Garden State Park in Cherry Hill. The developer has New Jersey projects in Egg Harbor Township, Glassboro, Mount Laurel, Old Bridge, Riverdale and across the nation.

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