Karmic Energy: Solar Workers Receive Nearly $2M in Back Pay After Misclassification

The U.S. Department of Labor (DOL) has announced that 147 workers hired by contractors to perform work on a federally funded solar power project in the Nevada desert will receive nearly $2 million in back pay.  The workers were subcontracted through a Henderson-based firm, Proimtu Mmi-Nv LLC, to provide construction services at the Crescent Dunes Solar Energy Plant.  

Between June of 2013 and April of 2014 the workers were labeled as ‘general laborers’ and paid $30 an hour to install solar panels.  The DOL, which has final say on such classifications, determined that they should have been labeled ‘steelworkers’ and paid a prevailing wage of roughly $60 an hour.  The classification and corresponding pay have been in effect since April.  

David Weil, administrator of the department’s Wage and Hour Division, said in a news release:

“The money we’ve recovered for these workers is not a windfall — it is their hard-earned pay that their employer was legally obligated to pay them but did not. Companies that benefit from federal funding must see to it that the money is used properly and that their workers are compensated according to the law.”

Wage and Hour officials say that so far almost $1.79 million has been distributed to 126 employees. The remaining $126,000 will be distributed to 21 other employees when the department can locate them. The company has agreed to “raise awareness” about wage requirements at the Crescent Dunes as part of their settlement.  

Officials from the company told VegasInc that they did not believe the contractor meant to break labor laws and that the confusion was probably due to the relatively new nature of the job:

Kevin Smith, CEO of project developer SolarReserve, said that as part of the federal loan guarantee, workers’ pay rates had to conform with U.S. labor law and that federal officials got to approve the job classifications.

Proimtu’s workers assembled heliostats, or billboard-sized computer-controlled mirrors. That job classification didn’t exist, Smith said, so the subcontractor picked another one in “good faith.” The workers were paid around $30 per hour, Smith said.

According to Smith, Energy Department officials were fine with the classification, but the Labor Department, which has the final say, was not. That department said the workers should have been listed as steelworkers, and as a result, should have been paid around $60 per hour, Smith said.

The contractors finished their work at Crescent Dunes roughly six months ago. Smith said he agreed with the original job classification and that it’s unfair to imply that Proimtu broke any labor laws.

“You’re talking about a new job classification that didn’t exist anywhere,” he said of heliostat work.

The project received $737 million in guaranteed loans from the Department of Energy in the fall of 2011.

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