[Editor's note: This article has been changed from the version in the print edition to reflect corrected information from the Department of Labor and Industries.]
Across King County, men who can barely afford to pay their living expenses are building the homes of tomorrow. In Seattle, one man reportedly gets dropped off after work at a house he shares with 14 people, including five children. In Federal Way, eight men are said to share a one-bedroom apartment with a single mattress. And in Bothell, eight men reportedly share a house they rent from the construction foreman they work for.
These men—according to a source who works undercover to organize workers on construction sites around the city—are the workers who paint, lay carpet, and hang drywall to feed the Seattle area's ongoing residential building boom. Despite the national housing crisis, demand for three-to-six-story apartment buildings and townhomes in Seattle remains steady, with applications for nearly 500 new residential buildings currently under review at the city.
Many of the workers who make this housing boom possible are undocumented immigrants recruited from Mexico by labor hunters, and, because they are not legal residents, none were willing to talk about their experiences. But several labor advocates provided nearly identical accounts of how these workers live. They earn about half as much as their unionized counterparts, and they live in rooms rented from their employers, far from construction sites and bus lines. This situation, the construction-industry source says, "opens the door for [the men] to be exploited" by employers who set the hours they work, sleep, and take breaks.
"These [employers] are getting around state and federal law by deliberately classifying these folks as independent contractors," says David West, director of Puget Sound Sage, a housing and labor nonprofit. Real independent contractors, unlike these workers, set their own hours and work at multiple job sites. By designating workers as contractors and requiring them to buy individual business licenses, employers avoid paying for injury insurance, sick leave, health-care coverage, and other employee benefits. "From what I can tell, two-thirds to three-quarters of all construction work in this residential market is done by workers under these conditions," West says.
Jeff Kelly, a field representative for the International Union of Painters and Allied Trades District Council #5, says, "You've got people building low-income housing who can't even afford to live in low-income housing." If the undocumented workers speak up, Kelly says, they risk losing their jobs—and they won't sue their employers because going to court would mean risking deportation.
Taxpayers wind up footing the bill for misclassified "independent contractors" hurt on the job, and the public pays for social services—like government-funded housing and food stamps—for employees who lose their jobs.
Businesses that cut corners on contractors have another advantage over competitors. Because their costs are kept artificially low, they're able to underbid competing businesses.
Brenda Mailloux, co-owner of Drywall Wizards in West Seattle, says her company "did lose out with other general contractors who thought they would line their pockets with the extra money [by paying misclassified workers less] as long as they could get away with it."
So far, the state departments that enforce business regulations have done little to curb these abuses. "The state is aware that it is going on but hasn't cracked down on it," says West.
But that may be changing, albeit slowly. Since 2004, the state legislature has been funding fraud-prevention programs, including four fraud auditors and three field team members to investigate job sites. Carl Hammersburg, manager of the Fraud Prevention and Compliance Program for the Department of Labor and Industries, says the state attorney general recently hired a dedicated prosecutor, who has charged 25 contractors for fraudulent employment practices. Of the 10 cases that have been resolved, he says, all have resulted in convictions. According to an L & I spokeswoman, one of the companies convicted of employment fraud is Schram Brothers Excavating, a construction company in Vancouver. But Hammersburg acknowledges that many cases go undetected. "We can't track it all," he says.
"We know that the steps the state is taking are not enough," says Kelly, who works with Spanish-speaking union members who accept jobs on construction sites to try to organize their fellow workers.
"They need to understand that the majority of people being taken advantage of speak Spanish, and their staff needs to reflect that."