Contractor Behind Ritzy NYC Buildings Stole Workers' Wages: DA

MIDTOWN MANHATTAN, NY — A contracting company behind one of Midtown Manhattan's skyline-altering supertall developments conducted multi-million dollar wage theft and insurance fraud schemes, city and state officials announced.

Queens-based Parkside Construction, its affiliate companies, four senior executives and a Michigan-based human resources company were hit with felony indictments Wednesday, officials said. The contracting company is accused of stealing more than $1.7 million from employees and evading more than $7.8 million in insurance costs despite winning nine-figure contracts to build some of Manhattan's newest skyscrapers, officials said.

Parkside Construction is the contracting company responsible for building Billionaire's Row tower 111 W. 57th St., which is set to become one of the world's tallest residential towers at 1,428 feet, officials said. Other Parkside contracts included residential and hotel high-rise building in Midtown and Lower Manhattan.

More than 500 Parkside Construction workers had wages stolen from them in 2016 and 2017, officials said Wednesday. Parkside Constrction utilized a sophisticated facial-recognition system to track workers' hours, but printouts from the machines would be altered to reflect less hours than were actually worked, officials said. As a result, workers would not be paid their fair wages.

"Amid Manhattan’s luxury building boom, sometimes it’s all too easy to overlook the human beings behind the scaffolding," Manhattan District Attorney Cyrus R. Vance, Jr., said in a statement. "Construction workers are responsible for some of the most dangerous jobs in the city, and whether they’re working thousands of feet up in the air or twenty feet below ground-level, they deserve to be paid fairly and fully for their work."

When Parkside Construction workers complained about their pay there were told that if they didn't like their jobs they could find work elsewhere, Vance said during a Wednesday press conference. Vance described the systematic wage theft as part of the contracting company's "business model."

The company also ducked $7.8 million in insurance costs by hiding more than $40 million in payroll from the New York State Insurance Fund to secure lower costs for insurance premiums, officials said. In 2015 the company's payroll grew to $15 million from $1.3 million the year before, but with the help of Affinity Human Resources the contractor falsely claimed that operations were restructured to dramatically cut payroll.

The Manhattan District Attorney's office is indicting Parkside Construction on charges such as insurance fraud, scheme to defraud and grand larceny, Vance said during a Wednesday press conference. Company co-owners Francesco Pugliese and Salvatore Pugliese, supervising foreman James Lyons and payroll manager Yenny Duarte will be charged individually.

Also facing charges is Michigan-based Affinity Human Resources, a company that provided Parkside services such aspayroll, employee benefits, and workers’ compensation management and its owner Jerry Hamling.

Not facing charges are the developers behind the buildings Parkside Construction was working. Vance said Wednesday that the investigation and indictment of Parkside Construction is the beginning of an effort to investigate "all of the players" behind Manhattan's development boom.

Here's a full list of buildings where Parkside Construction had contracts:

• The Marriott Hotels at 215 Pearl Street
• Steinway Tower at 111 W. 57th Street
• American Copper Building at 626 First Avenue
• Courtyard New York Downtown Marriott at 133 Greenwich Street
• Hilton Garden Inn New York Times Square South at 326 W. 37th Street
• DoubleTree by Hilton Hotel at 350 W. 40th Street
• Public Hotel at 215 Chrystie Street, and
• Jarmulowsky Bank Hotel at 9 Orchard Street.

Photo by Shutterstock.com