10 Middlesex Companies Got 'Stop-Work' Orders From NJ: What It Means

MIDDLESEX COUNTY, NJ — New Jersey released “stop work” orders for 10 Mercer County companies, after evidence of “worker exploitation.”

The New Jersey Department of Labor and Workforce Development (NJDOL) recently released a list of county-by-county data that show the locations of all “stop work” orders issued between July 2019 and July 2023.

Out of the 110 stop-work orders issued since 2019, state officials say that 87 involved construction jobs, with 44 being public works projects. Stop-work order investigations have so far led to 11 contractors being debarred from engaging in future public works jobs.

According to a statement from the governor’s office, the NJDOL’s Division of Wage and Hour and Contract Compliance has the authority to immediately halt work at any public or private worksite – both construction and non-construction – when an investigation finds evidence that an employer may have violated state wage, benefit or tax laws.

“The most common violations leading to stop-work orders are: employers not having workers’ compensation insurance or misclassifying employees as independent contractors. Other examples include employers who fail to pay prevailing wage or overtime; those who have outstanding judgements against them; or those whose workers were not paid, were paid late or were shorted, or were paid in cash off the books,” the state official said.

“Often, these unscrupulous employers have not made their required contributions to the state unemployment trust fund, from which unemployment payments are drawn.”

In Middlesex County, stop work orders were issued to the following companies:

• Concrete Solutions NJ, LLC: Dunellen
• Bismark Construction Corp: Dunellen
• Modern Technology, Inc: Edison
• The Kemmerer Group, Inc: Edison
• Best Hernandez Construction, LLC: Monroe
• Carol Concrete, LLC: Monroe
• Elite Pro Rebar: Monroe
• 5 Star Reinforcement GA, LLC: Monroe
• Kico Construction, LLC: Monroe
• A&D Welding, Inc: Piscataway

In the four years since Gov. Phil Murphy expanded the state’s ability to halt work on job sites, more than 110 such orders have been issued across New Jersey

“Since the beginning of our administration, we have been dedicated to respecting, defending, and upholding the rights of all New Jersey workers, who are the lifeblood of our economy,” Gov. Phil Murphy said.

“These expanded powers have led to over a hundred stop-work orders in just the past few years, advancing our commitment to stronger and fairer worker protections.”

Labor Commissioner Robert Asaro-Angelo said that the vast majority of New Jersey employers follow the law and do right by their workers. But when a business doesn’t treat its workers fairly, an example needs to be made, he said.

“It’s not just about stopping the violations in progress,” Asaro-Angelo said. “There is also an educational component to prevent these issues from happening in the first place.”

NJ STOP-WORK ORDERS: A BRIEF BACKGROUND

In 2019, Gov. Murphy signed a bill that gave the NJDOL the power to issue stop-work orders whenever an initial work site investigation finds “sufficient violations.”

In 2021, Murphy further boosted these powers, permitting stop-work orders to be applied to all work sites of an employer found to be in violation of the law.

Later that year, the NJDOL used its newly authorized power to halt every job being performed in the state by an Essex County-based contractor found to have “repeated and ongoing violations of state wage and hour laws”: Cunha’s Construction Inc. in Newark.

“These inspections found the contractor was paying workers in cash off the books and did not have workers’ compensation insurance,” state officials alleged. “Other violations involve the misclassification of construction workers by paying them in cash off the books, failure to pay overtime, failure to keep records, hindrance of the investigation, and unpaid or late paid wages.”

It marked first time that the department has used its authority to pause all work by a single entity, instead of a per-project basis – a major milestone.

Prior to the law’s enactment, the NJDOL had little recourse to stop or prevent violators from shirking these policies, state officials say. Work stoppages were rarely utilized because they could be applied only in cases when an employer amassed a history of violations.

This made stopping out-of-state violators doing work in New Jersey particularly difficult, as they often left before the department could enforce its regulations, according to the governor’s office.

Since the new law rolled out, stop-work orders have been used to shut down work sites of all types, such as construction jobs, restaurants, an internet radio station, and medical offices. Typically, stop-work orders are resolved in a matter of a few days, and are often resolved on the spot when the order is delivered to a business – as was the case in August 2021 when the NJDOL issued stop-work orders to four separate businesses for wage violations, with each business paying the back wages owed to their workers immediately to avoid closure.

Stop-work orders can be appealed by an employer, in which case the NJDOL has seven days to schedule a hearing. The NJDOL continues to monitor locations where stop-work orders have been issued, and can assess civil penalties of $5,000 per day against an employer conducting business in violation of the order, which has occurred just once in the past three years.

Of the businesses that have been issued a stop-work order over the past three years, there have been no repeat offenders, state officials say.

“We understand stop-work orders impact employees and their ability to work, which is why we issue them only when warranted,” said Assistant Commissioner Joseph Petrecca of the Division of Wage and Hour and Contract Compliance.

“Our goal is to ensure compliance among employers for the benefit of their workers,” Petrecca said. “Fortunately, we’ve found most employers will do whatever it takes to come into compliance as quickly as possible.”

As part of last week’s announcement from the governor’s office, two representatives of industry trade groups supported the NJDOL’s recent stop-work campaign.

“Our hat is off to the New Jersey Department of Labor for using the strongest weapon in its arsenal to crack down on bad actors who cheat the system in the construction industry,” said Bill Mullen, president of the New Jersey Building and Construction Trades Council.

“Stop-work orders are a powerful tool needed to ensure that construction workers are protected from contractors who exploit them and cheat them out of wages and benefits they have legally earned,” Mullen added.

Jack Kocsis, CEO of the Associated Construction Contractors of New Jersey, said that enforcing wage and hour laws helps to “level the playing field” for responsible companies.

“When employers exploit their workers, the state loses millions in tax revenue, reputable contractors lose out on opportunities to bid, and the workers themselves are left without the protection of healthcare coverage, workers’ comp, retirement plans and other important benefits,” Kocsis said.

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