Castro plan to address wage theft in the construction industry signed by governor

Cavina T Morris

 

ELGIN – Construction workers who are not fairly compensated by subcontractors will soon be given an opportunity to collect unpaid wages, thanks to a new law spearheaded by State Senator Cristina Castro (D-Elgin).

“Wage theft is a real problem, especially in the construction industry, which can have a complicated web of involved companies,” Castro said. “This law will provide a mechanism for the workers who have been slighted to receive their fair compensation and encourage primary contractors to employ reputable subcontractors.”

In a typical construction project, commercial property owners or developers will hire a primary contractor, also called a general contractor, to oversee a project. The general contractor will hire and coordinate with subcontractors, such as ones specializing in painting, window installation, electrical and more. Subcontractors employ their own workers to carry out their part of the project.

Under the new law, if a subcontractor fails to pay an employee, goes bankrupt or cannot pay their employee for any other reason, that employee can file a legal claim with the general contractor for any unpaid wages and benefits. Additionally, it requires the subcontractor to compensate the general contractor if this happens.

“Last year alone, 52,000 construction workers in Illinois reported payroll fraud,” Castro said. “These are real people who are going without their earned compensation, highlighting the pressing need for this law. I am pleased to see this signed to ensure our workers have an opportunity to be paid.”

The law includes exemptions for residential rehab and small commercial projects and does not include projects where a homeowner acts as their own general contractor.  Additionally, it adds a statute of limitations for when complaints can be filed and creates a task force to consider innovative ways to bring bond reform to the construction industry.

The law, originally called House Bill 5412, was signed by the governor Friday and is effective immediately.

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https://www.illinoissenatedemocrats.com/caucus-news/23-senator-cristina-castro-news/4163-castro-plan-to-address-wage-theft-in-the-construction-industry-signed-by-governor

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