The Real Deal
Construction unions may be nearing a victory in their war on “body shops.”
A new City Council bill would impose licensing and disclosure
mandates on companies competing with union labor at construction sites.
The bill, expected to be introduced by Council member Diana Ayala on
Thursday, would require labor brokers to obtain a license from the city
and report their workers’ demographics, wages and benefits twice a year.
The measure has been sought by the construction laborers union, Local 79, which wants the city to crack down
on nonunion companies that supply low-wage laborers to general
contractors. The union accuses them of exploiting women and the formerly
incarcerated in particular.
“Construction body shops provide developers with a cheap labor pool,
made up of black and brown justice-affected nonunion workers,” Ayala
said in a statement. “Body shops take advantage of the scarcity of
employment opportunities for re-entry workers, and effectively force
these workers into dangerous jobs, with no training, for low pay. They
prey on the fears of resentencing.”
But the nonunion firms say their jobs are a lifeline to people
leaving prison, providing them with pay and skills that help them get
back on their feet. Union construction jobs are much harder to get, they
say, and involve navigating a system that is confusing and arcane for
many New Yorkers.
Under the proposed legislation, companies applying for a license must
provide proof of insurance, disclose their ownership structure and
certify that they comply with the law. The city can deny a license if
the company — or an affiliated predecessor — has outstanding legal
penalties or if the Department of Consumer Affairs and Worker Protection
deems that it “lacks good moral character.”
Companies that operate without the license would face $200-a-day
fines. General contractors, subcontractors and licensed employment
agencies/organizations would be exempt. A separate City Council bill is seeking to require general contractors to obtain a license.
Over the past decade, unions have lost ground to nonunion general
labor firms, especially in the affordable housing market. Local 79,
however, has negotiated with developers, agreeing to wage concessions to win work.
Last month the City Council’s Committee on Consumer Affairs, which is
chaired by Ayala, held a hearing on employment agencies and other
labor-placing businesses. The meeting largely focused on body shops, as
the union calls them.
At the time, the Real Estate Board of New York proposed alternatives
to address allegations of exploitation, including increasing funding to
the Department of Consumer Affairs “to better protect justice-involved
and other vulnerable workers from wage theft and other unsafe or illegal
practices.” The organization also pitched requiring that workers on
publicly funded construction jobs be paid more than minimum wage, plus
benefits.