This article was featured in the October 2026 edition of the Utility Contractors Association of New England, Inc.’s Construction Outlook.
In September, the Massachusetts Office of the Attorney General (the “AGO”) released its annual “Labor Day Report,” stating that the members of its Fair Labor Division have “continued to stand as steadfast protectors of workers’ rights across the Commonwealth.” Statistically speaking, the AGO reported that, in the past year, it “has taken more than 1,200 enforcement actions affecting 16,410 workers” and “has assessed more than $8 million in wage restitution” and “more than $4.6 million in civil penalties.” (Emphasis in original). The AGO stated that “[e]very dollar of wages recovered strengthens not only a family’s financial security but also our state’s economy.”
As in prior years, the AGO’s Labor Day Report addressed the construction industry. According to the AGO, the construction industry ranked in the “Top Five” industries with respect to enforcement amounts. In fact, the construction industry was number one. Of the total $12,687,655.00 amount assessed by the AGO in restitution and penalties, $2,542,845.11 was attributable to the construction industry. This was more than any of the other “Top Five” industry, with the restaurant/hotel industry coming in second with $2,479,307.67 in assessments. For reference, last year, the construction industry ranked third in assessments, behind the restaurant/hotel and transportation/delivery industries. Across all industries, non-payment/failure to make timely payment of wages was the most frequent violation by far, with failure to keep true and accurate payroll records trailing at a distant second.
The AGO confirmed that the “construction industry remains a top enforcement priority for Fair Labor because protecting workers and ensuring a level playing field for law-abiding employers go hand in hand.” Its enforcement actions this past year in the construction industry resulted in restitution payments to more than 1,300 employees.
Importantly, the AGO highlighted the fact that a “dedicated, multilingual investigative team continues to conduct unannounced compliance visits to active construction sites throughout the Commonwealth . . . .” According to the AGO, this team visited 37 sites last year and engaged with more than 160 employers and almost 400 workers. The AGO also referred 136 matters to the Massachusetts Council on the Underground Economy, a “partnership of agencies” that “share information and coordinates targeted actions to eliminate worker misclassification and foster an equitable economic environment.”
The AGO highlighted three case studies. In one case, a millwork company had allegedly failed to properly pay its workers and also misclassified workers as independent contractors. In another case, the Fair Labor’s Construction Field Team investigated a work site and issued five citations to a company that had allegedly failed to pay overtime, failed to furnish suitable pay slips, misclassified employees as independent contractors, failed to permit employees to earn and use sick time, and failed to keep true and accurate payroll records. According to the AGO, these issues impacted 14 employees. In the third case, the AGO reported a settlement with a construction contracting company that allegedly failed to properly pay employees. Each one of these reported cases resulted in six-figure restitution and penalties.
The construction industry has been a focus of the Fair Labor Division for several years. Contractors may expect that focus to continue to sharpen now that the construction industry topped the list when it comes to assessments this past year. Contractors in the Commonwealth should continue to diligently comply with applicable laws, including wage and hour laws. Importantly, depending on the facts and circumstances, violations may extend beyond company liability and into the realm of personal/individual liability. Not only that, non-compliance can also give rise to potential exposure under other statutes, such as the False Claims Act. As a result, contractors should be sure to install, administer, and enforce appropriate company policies. Notably, the fact that a contractor may have robust policies and procedures in place may not be of much practical value if the company does not actually implement those policies and procedures. In some cases, contractors may have “off the shelf” policies that include requirements that are simply not applicable to their business. These types of facts can sometimes work against contractors. In addition, contractors should train their teams, including with respect to visits or inspections by governmental authorities, such as the AGO or the Occupational Safety and Health Administration (“OSHA”). Preparation is critical, particularly when it comes to unscheduled/unprogrammed or unannounced visits to a contractor’s facilities or jobsites.
