Tax Fraud Days of Action 2024

North Central Regional Council of Carpenters’ (NCSRCC) members and signatory contractors set the standard for the construction industry in the Upper Midwest; setting a high-bar for training, productivity, on-the-job safety, safe working conditions, apprenticeships, and wages and benefits.

We have worked hard to build these standards and will work even hard to defend what we have built. Construction industry tax fraud affects workers across the nation and the negative consequences ripple through neighborhoods big and small. When developers, contractors and subcontractors cheat the system, they take advantage of workers, law-abiding businesses, taxpayers and communities.

While standing up to tax fraud is a year-round mission for the Carpenters Union, there is one week where all councils within the United Brotherhood of Carpenters (UBC) join forces to call out cheating contractors and stand up for workers, families and the construction industry. That week is Tax Fraud Days of Action (TFDOA) and fell on April 13-19 this year.

Throughout the Regional Council, staff and members hit the ground for Tax Fraud Days to educate partnering contractors, financial institutions, elected officials and the general public on the negative effects of industry tax fraud. Through thank you banners, area standards pickets, bank meetings or elected official ride-alongs, the Carpenters Union worked to spread awareness and solidarity.

In Wisconsin, an area standards picket was held on April 14 for fair wages at a development in Brookfield, WI. NCSRCC members protested Waukesha-based Suburban Drywall who was hired as a subcontractor for the Poplar Creek hotel. People working for Suburban have reported being hired off-the-books and being misclassified. When asked to comment for The Daily Reporter, NCSRCC business representative Raúl Hernández said, “There’s so many millions of dollars that don’t go into communities where these projects are taking place. These contractors are doing this (withhold wages and taxes) so they can illegally lower their labor costs and underbid law-abiding competitors. So, these are taxes that don’t go into the community when they should support public services.”

In Minnesota, a legislative bill has been making its way through the capitol that would ensure an effective and efficient approach to misclassification enforcement in the state. Misclassification of Employees Prohibited bill (HF4444/SF4483) came at recommendation from the Minnesota Attorney General’s Misclassification Task Force which is comprised of business, labor, employee, independent contractor and academic experts. If passed, this bill will create more enforcement tools and increase the severity of penalties against employers who misclassify their employees. Additionally, it will maximize the ability to fight employer misclassification fraud in Minnesota.

“The bill would create an interagency partnership to ensure that all aspects of misclassification are coordinated and will significantly increase penalties for bad actors by the Department of Labor and Industry. This will make it harder for the fly-by-night companies paying workers in cash to disappear while owing workers and the State significant sums of money,” stated Burt Johnson, NCSRCC General Counsel and member of the Task Force.

In Nebraska, a thank you banner for E&K Construction was held high for their partnership in standing up to tax fraud, and an area standards banner was displayed calling on Hausman Construction of Lincoln, NE to hire subcontractors that pay and meet area labor standards for construction work on all of its projects. Hausman has hired Ramirez Drywall who does not pay its employees area labor standard wages and benefits. When carpenters are not paid area standards, they struggle to support their families and have fewer dollars to invest in the communities they live and work. This causes a ripple effect and can have serious impacts to the local economy and businesses.

In Iowa, thanking partners for their support in the fight against tax fraud was done in eastern areas of the state and meetings with financial institutions were held in central and western areas. Banners were displayed for the University of Iowa Labor Center, Linn County, the city of Cedar Rapids and Dubuque, Iowa.

“It could not have gone better. We were able to go over the construction tax fraud business model and give examples on how this problem results in worker exploitation and negative community affects,” recalled NCSRCC Business Representative Devon Fishback who met with Community State Bank in Johnston, IA. “A long-standing partner, Community State Bank was incredibly receptive and even went as far as committing to red flagging any businesses that have a history of wrong-doing. Educating and partnering with financial institutions is essential in this fight and can act as an early block to cheating contractors.”

As the fight continues to end construction industry tax fraud, we look to our membership, signatory contractors, and industry partners to stand with us and help us protect workers’ rights, local economies, and the communities in which we belong. For more information on this effort, visit the UBC’s Stop Tax Fraud website at www.stoptaxfraud.net/standup.