The Count Grows As State Agencies Pick Up The Pace

SACRAMENTO, Calif., Feb. 27, 2012 /PRNewswire/ -- California's economic climate alone makes it tough for law-abiding subcontractors to succeed, but it is worsened by the destructive and costly impact of the underground economy. California's Contractors State License Board (CSLB) estimates more than 210,000 contractors participate in the underground economy, which is why the California Professional Association of Specialty Contractors (CALPASC) continues to closely watch the actions of a number of state agencies, including the CSLB, Department of Industrial Relations (DIR), Employment Development Department (EDD) and the Department of Insurance. "We appreciate the efforts of all of these state agencies to catch fraudulent contractors," said CALPASC Executive Director Brad Diede. "The focus on improved coordination and outcomes must continue to ensure not only our industry's health, but the health of our state as well."

One of the ways CALPASC monitors state agencies' actions is by regularly inviting them to attend meetings of the Construction Enforcement Coalition representing employers, businesses, associations and labor groups exasperated by the underground economy. At the Coalition's February 15 meeting, the DIR provided an overview of recent efforts to increase coordination, including the continued work of the Labor Enforcement Task Force (LETF) whose mission is to "combat the underground economy through a focused and vigorous education and enforcement effort." As cited by Renee Bacchini, Special Assistant to DIR Director Christine Baker, two of LETF's four goals are to "ensure workers receive proper payments of wages and are provided a safe work environment and ensure California receives all employment taxes, fees and penalties due from employers."

"Considering recent media reports about CSLB's suspension of US-Sino Investment, Inc.'s license for failure to comply with workers' compensation laws coupled with the death of an employee at one of their construction sites," commented Diede, "LETF should be given every resource needed to successfully wipe out underground employers."

Diede further stated, "LETF's goal to eliminate unfair business practices by leveling the playing field is in concert with CALPASC's LEVEL Program."

California's subcontractors believe timely collaboration among agencies is the key to the success of programs like LETF to abolish unethical business practices. To date, LETF has relied on cooperation between agencies, such as the Board of Equalization, CSLB, DIR, EDD and many others, to catch deceitful contractors who are bleeding California of an estimated $6.5 billion while creating and/or maintaining unsafe work environments.

Another example of partnering between state agencies was described in reports about surprise compliance checks at the job sites of Victor Valley businesses. The success of the effort relied on the CSLB and District Attorney's office working in conjunction with one another that resulted in three contractors cited for failure to secure workers' compensation insurance and for filing false workers' compensation insurance exemptions.

"In this case, we potentially have three subcontractors from three separate trades out of compliance with significant regulations," stated Diede. "The continual focus and improved coordination of agencies to catch crooked contractors is mandatory if legitimate contractors are to compete fairly in this economic climate."

The California Professional Association of Specialty Contractors is a nonprofit 501(c)6 trade association advocating on behalf of trade contractors and suppliers of building materials in California. CALPASC is committed to educating members on complex issues and advancing safety and compliance within the building industry.

www.calpasc.org

SOURCE The California Professional Association of Specialty Contractors (CALPASC)