Report calls for wage-theft safeguards after Amherst construction workers went months without pay

AMHERST — A report released by the University of Massachusetts Labor Center this week is calling for stronger wage-theft protections across the state, and more avenues for holding developers responsible for such incidents, following an investigation into workers going months without being paid for hanging drywall at a mixed-use project in North Amherst.

The report, written and researched by Tom Juravich, a professor of sociology at the Labor Center, describes how nine workers didn’t immediately get $50,173 in wages during the 2019 construction of North Square Apartments, though the state Attorney General’s office in April, acting on a complaint, ordered that two companies pay $23,977.85 in back wages and fined them $17,500.

“Current law and practice in Mas sachusetts did not provide workers what they deserved and fines against the violators were too small to act as deterrents moving forward,” Juravich wrote in the report’s executive summary.

While the complaint was specific to two companies, Combat Drywall of Billerica and Alvarez Drywall of Manchester, New Hampshire, the Labor Center report notes that the wage theft occurred despite Beacon Communities Development of Boston, which developed the project, receiving substantial tax credits from the town of Amherst, estimated at $2.8 million over 10 years, and significant funding from the state. In fact, Gov. Charlie Baker was present at the June 2018 groundbreaking for the $47.5 million project.

The subcontractors were hired by general contractor Keith Construction of Canton.

“Developer Beacon Communities made no efforts to remedy this wage theft despite being aware of it, and the firm itself was not held responsible for it,” Juravich writes. “It is clear that we need new legislation to guard against this kind of wage theft.”

Beacon Communities President Joshua Cohen said in a statement that learning about the “unacceptable treatment” is upsetting and that Beacon would do its part to take corrective action.

“In 25 years of building affordable and mixed income housing across the region, we have never previously known of any allegations of wage theft at one of our construction sites,” Cohen said. “We are glad that this matter went to the Attorney General and that those responsible have been punished. We have a lot of respect for the Attorney General and assume that the AG properly determined the amount due. But if the workers can demonstrate to us that the AG did not properly determine the wages due, we are prepared to make up the difference.”

Juravich said in a phone interview Thursday that his research into construction of similar residential projects began eight years ago and that seeing similar “illegal and immoral practices” is not unusual.

“North Square is not the exception. I’m finding it over and over,” Juravich said. “This is not just the one time this happens, and it’s important that citizens and political leaders in the commonwealth are aware of this.”

In this case, Alvarez Drywall was essentially acting as a labor broker, rather than a company, and hired undocumented workers from Honduras to hang drywall.

Juravich met with these workers, who described long hours and the conditions they worked under, and then failing to get paid.

Wage theft bylaws would give the town more oversight to monitor the projects, as well as labor unions and workers rights coalitions better ability to track what is happening at such projects.

The current regulatory system is out of touch and does little to protect the low-wage workers, as the developer profits, Juravich said.

“Beacon’s commitment to building affordable housing (and the firm’s overall progressive values) did not guide the way the development was built,” Juravich writes. “Similar to scandals we have witnessed in the apparel industry, where even socially responsible designers have had their garments stitched by underage workers in the Global South, Beacon turned a blind eye to how workers were treated during the construction of the North Square.”