Developers owe $3 million for underpaying workers
by Benjamin Fang
Nov 12, 2019 | 449 views | 0 0 comments | 67 67 recommendations | email to a friend | print
The developers of a luxury apartment building in Downtown Brooklyn have reached a settlement after an investigation into accusations of underpaying their workers.

On Friday, Attorney General Letitia James and Comptroller Scott Stringer announced that Mica Gabe Brooklyn, LLC and Brooklyn Warehouse 180, LLC, the owners of 180 Nassau Street, will pay $3 million in the settlement.

Nearly $415,000 in back wages and interest will go toward their building services employees. Another $2.5 million in damages will be given to the city and state for the developers fraudulently obtaining a tax break and failing to follow prevailing wage requirements.

Finally, the service employees union 32BJ SEIU will receive a portion of the damages as a reward for notifying the state of the landlords’ violations.

“Swindling workers out of their hard-earned wages will never go unanswered by my office,” James said in a statement. “Not only did these landlords fraudulently enrich themselves and steal from taxpayers, but did so while underpaying their workers.

“We are holding these defendants accountable and will continue to protect workers’ rights by making sure that developers and landlords who receive these specific tax incentives live up to their end of the bargain by paying workers what they’re owed,” she added.

The joint investigation found that in 2014, defendant Mica Gabe “fraudulently induced” the city’s Department of Housing Preservation and Development (HPD) to issue a 421-a tax exemption for their property.

Gabe had assured the agency that their building service employees would be paid prevailing wages, the probe found. But the developers failed to pay employees the proper wages between August 2014 and March 2016.

Specifically, Gabe paid newly hired doormen a wage of $12 per hour, rather than the prevailing wage of $17.58 per hour. A superintendent was paid $17.50 per hour, rather than $24.26 per hour.

Under New York’s 421-a tax break on multi-family buildings, developers who qualify have to either pay prevailing wages to building services employees or set aside a number of affordable housing units.

The 10-story building in Downtown Brooklyn includes 103 luxury rental units with a 24-hour concierge-attended lobby, a superintendent, doormen, porters and other building services employees.

“This is a huge victory, not only for the hardworking men and women who have kept Brooklyn Warehouse clean, safe and functioning for tenants, but also for the families and communities that rely on them,” said Kyle Bragg, president of 32BJ. “We hope this settlement serves as a warning to others in our city who would look to cut costs by undercutting workers.”
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