STATE COLLEGE, Pa. (AP) — Pennsylvania construction contractor, Glenn O. Hawkbaker, Inc., has pleaded no contest to theft relating to violation of the Pa. Prevailing Wage act and the federal Davis-Bacon Act.
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“Hawbaker is pleased to bring this process to a conclusion and focus on the future. Our company’s decision to plead no contest avoids protracted litigation, which could have jeopardized the livelihoods of our dedicated employees,” Hawbaker said in a company statement. “We continue to believe that we followed all requirements regarding fringe benefits. The fringe benefit practices challenged by the Office of Attorney General were based upon advice provided by the company’s former attorneys. Hawbaker has always intended to properly pay all of its employees.”
Following charges from Pa. Attorney General Josh Shapiro in early April, the contractor appeared in Centre County Court to enter a plea.
The attorney general’s office says Hawbaker stole more than $20 million from workers’ fringe benefits such as retirement and health insurance. The plea includes paying more than $20 million in stolen wages to over a thousand Pa. workers.
AG Shapiro previously said, “this is the largest prevailing wage criminal case on record — under Pennsylvania prevailing wage law and across the United States under federal law. My focus now is on holding Hawbaker accountable for breaking the law, and getting these workers their money back.”
Hawbaker is a family-owned, non-Union company that’s been in business for 70 years. They are one of the largest contractors to complete projects for the Commonwealth, receiving an estimated $1.7 billion in contracts between 2003 and 2018.
It said in a statement, “While we believe that we have always acted in accordance with all state and federal laws, in an abundance of caution, the company immediately changed its prevailing wage practices.”
Shapiro said Hawbaker is cooperating with the investigation but said all companies in Pa. should be on notice — because the Attorney General is watching.
The restitution is for the largest prevailing wage criminal case in U.S. history.
“A month ago I met with some of the men and women who had their wages and retirements stolen by Hawbaker — and I told them that we will do everything we can to get them every cent they are owed under the law. A few minutes ago, I was able to tell them that we made good on that promise,” Attorney General Shapiro said.
The Pa. Prevailing Wage Act and the Davis-Bacon Act were enacted to level the playing field and protect workers.
“We took on one of the largest construction companies in the state, and now 1,267 people will have a better shot at retirement; they will get the paychecks they earned under the law; and they will have their work and their livelihoods protected and respected, instead of ignored,” Shapiro said.
According to the press release, Hawbaker pleaded no contest to four felony counts of stealing wages from its workers. They were also charged with stealing funds intended for prevailing wage workers’ health and welfare benefits and using them to subsidize the cost of the self-funded health insurance plan that covers employees.
“I’ve heard directly from contractors that follow the law that this enforcement helps their business, and exposing these flagrant examples of wage theft and misclassification will deter employers from engaging in the same illegal schemes. That’s why my office and our partners in law enforcement are committed to this work,” AG Shapiro concluded.
The company is sentenced to five years’ probation and agreed to several other conditions, plus the payment of $20,696,453 to the restitution of 1,267 affected workers.
“Through the years, both state and federal regulators extensively reviewed our Prevailing Wage Act and Davis-Bacon Act practices on jobs and did not find any wrongdoing. This led us to believe we were properly following all laws, and we did not plead guilty. We fully cooperated in this process and proactively addressed concerns raised by the attorney general’s office. As stated by the attorney general, we are making past and present employees whole. This process will be conducted under the direction of an independent monitor. We now look forward to continuing to deliver outstanding service to our customers and providing opportunities for our dedicated team members,” Hawmaker said in a statement following the sentencing.