District of Columbia AG Secures Record $3.75 Million Wage-Theft Settlement

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  • District of Columbia AG Brian Schwalb settled with contractors Power Design, Inc. (PDI) and John Moriarty & Associates of Virginia, LLC (JMA), along with multiple labor subcontractors, to resolve allegations that the companies misclassified employees as independent contractors, depriving them of overtime pay, sick leave, and other employment protections and benefits, in violation of District wage laws.
  • The AG’s office alleged the labor subcontractors misclassified workers as independent contractors instead of employees and failed to pay overtime, violating District wage laws.  The consent order claims PDI and JMA are jointly and severally liable as “upstream contractors” for the alleged wage and sick leave violations committed by the labor subcontractors on their projects.
  • Under the consent order, PDI will pay over $1.7 million in restitution to more than 1,200 construction workers employed by downstream labor subcontractors for misclassification and paid sick leave violations, over $1.1 million in penalties to the District, and $880,000 in attorneys’ fees.  Additionally, PDI must complete compliance monitoring, overhaul its payroll and contracting practices to prevent future worker misclassification, among other injunctive terms.  JMA is also required to reform its subcontracting practices and inform workers of their wage-related rights at job sites.
  • We recently reported on other wage-related settlements AG Schwalb reached with Prestige Drywall LLC, District Dogs, Inc., B&B Solutions US, LLC, and Levy Premium Foodservice Limited Partnership.
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