ASSEMBLY BILL 1701
With General Contractors Liable for Subcontractors' Wage Theft on Housing Projects, Piece-rate Drywall and Framing Subs Pose a Big Concern
California Labor Code 218.7 now makes general contractors liable for a subcontractor’s labor violations on private construction projects.
This law is a critical step in helping victims of wage theft recover their money, and enable responsible contractors to compete fairly and not be undercut by law-breakers. This law is a powerful tool to foster a culture of compliance in the residential mixed-use industry where wage theft and payroll tax fraud practices are all too common.
If general contractors realize they have skin in the game, they will not be able to turn a blind eye and will take steps to ensure they work with responsible law-abiding subcontractors.
Hiring bad subcontractors with shady business schemes is bad for business, and can create complications in terms of timely project completion along with legal exposure.
This new law also allows federally-established labor-management cooperation committees such as the Carpenters/Contractors Cooperation Committee (C/CCC) to file legal actions against general contractors to ensure workers get paid all their wages.
For over 30 years, the Quad C has collaborated with civil and criminal enforcement agencies to ensure compliance with the law on construction projects. Our compliance activities have helped thousands of workers recover millions of dollars in back wages, and enforcement actions have involved violating subcontractors who have performed work for many prominent general contractors and developers.