New York City Comptroller William C. Thompson, Jr. announced today that his office had debarred Start Elevator, Inc. and several related entities for willfully violating state prevailing wage laws by underpaying elevator repair and construction workers who performed work on public projects.

Comptroller Thompson also reached a settlement with Start Elevator and Prude Construction Corporation that requires them to pay $257,649 in restitution to cover back wages and interest for 23 underpaid workers and a civil penalty for the City of New York. 

“Start Elevator was entrusted to install Americans with Disabilities Act compliant elevators in a New York City subway station, but broke the law by underpaying its employees the wages they were owed,” Thompson said. “Start Elevator also shortchanged workers it dispatched to other City and State elevator repair contracts. The company thought it could ignore prevailing wage laws. But now, in addition to the monetary consequences, Start Elevator must pay a heavy price by being excluded from bidding on future City and State contracts.”

Thompson continued: “I applaud both the MTA and the DOT for their work and especially for reaching out to my office with their concerns of possible labor law violations. By working together, we can protect workers’ rights and ensure that contractors respect prevailing wage laws.”

“I am very pleased with the outcome of this investigation,” said MTA Inspector General Barry L. Kluger. “My office will continue to aggressively enforce the New York State Labor Laws on all MTA contracts to protect the rights of the workers and ensure that the MTA is getting the quality work it’s paying for.”

The New York City Metropolitan Transportation Authority (MTA) contracted with Prude Construction to upgrade the elevators in the West 4th Street Subway Station on the Eighth Avenue line to comply with Americans with Disabilities Act (ADA) requirements. Prude Construction subcontracted with Start Elevator to perform the work. Start Elevator also provided elevator repair and maintenance work at various locations for the New York City Department of Transportation (DOT).

The MTA Office of Investigator General (IG) began an investigation when several workers reported that they were being underpaid. The IG investigated the allegations and subsequently forwarded the case to the City Comptroller’s Office. Similarly, the DOT contacted the Comptroller’s Office with suspicions of labor law violations on its contract with Start Elevator. The Comptroller’s investigation covered Start Elevator’s work for the MTA from March 2004 to December 2004 and for the DOT from April 2005 to July 2006.

Comptroller Thompson’s Bureau of Labor Law resolved the two matters with Start Elevator simultaneously. In accordance with the stipulation, Thompson collected a total of $234,226 in back wages, benefits and interest due to 23 workers, as well as a civil penalty in the amount of $23,422.

The stipulation also provides that Start Elevator willfully violated the prevailing wage laws. Given the New York State Department of Labor’s January 2008 determination that Start Elevator also underpaid its workers and willfully violated the labor law on a separate State contract, all Start Elevator entities are now debarred from submitting a bid on or from being awarded any public works contract or subcontract with the City or State for five years.

Since 2002, Comptroller Thompson has debarred 29 contractors.

The New York City Comptroller enforces State laws that require private sector companies to pay employees prevailing wages and benefits when they work on “public works” contracts with the City for construction or building services. The New York State Department of Labor enforces the prevailing wage law for contracts let by State agencies. The City Comptroller also enforces New York City’s living wage law that sets minimum wage rates for security guards employed by City contractors, home attendants, day care workers and several other job titles when they are employed by City contractors. 

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