In 2019, construction workers raised alarms about a company building luxury apartments in Oakland that appeared to be skirting its financial obligations, both to the state and its employees.
That tip would set off a years-long investigation by the California Department of Justice, which accused the Kentucky-based company, US Framing West Inc., of violating state labor laws at that Oakland site, as well as committing tax evasion and wage theft in several other construction projects across the state, including some that had received public funding.
“While working these projects, we allege, US Framing West failed to pay more than $2.5 million in state payroll taxes,” Atty. Gen. Rob Bonta said at a Tuesday news conference. “We also allege that, at a public works project in Cathedral City, US Framing West also underpaid its workers by approximately $40,000.”
For the record:
6:47 a.m. Nov. 27, 2024The headline and article have been corrected to state that funds recovered by the DOJ would go to the state not federal government and that construction workers reached out to the union.
Bonta and his team have filed 31 criminal charges, including grand theft, payroll tax evasion, prevailing wage theft and filing false documents, against US Framing West and two of its employees.
“For some reason, US Framing West seems to think it can [operate] outside the bounds of California labor laws, thinks it can steal from California and from our workers,” Bonta said. “I’m here with a simple message: They cannot; no company can.”
The two employees, Thomas Gregory English and Amelia Frazier Krebs, as well as the company, pleaded not guilty in the case earlier this month, according to Los Angeles County Superior Court records.
Gary S. Lincenberg, an attorney representing English and the larger company, declined to comment on the specifics of the allegations but said, “We intend to address the AG’s concerns in court.”
“US Framing is a hard-working company with a great reputation,” Lincenberg said in a statement.
The attorney representing Krebs, Jeffrey Rutherford, said he and his client “intend to vigorously fight the charges.”
Between 2018 and 2022, US Framing West worked on several construction projects across the state, including in Alameda, Los Angeles, Contra Costa, Orange, Riverside, San Diego, San Francisco and Santa Clara counties, according to the attorney general’s office. In many cases, the company used crews of unlicensed subcontractors, who the state mandates be classified as company employees — triggering certain tax requirements, Bonta said. However, the company failed to appropriately file and submit taxes for those subcontractors.
Additionally, investigators found that US Framing West failed to fulfill requirements to pay a prevailing wage — typically a rate similar to that of unionized workers, often well above minimum wage for specialized jobs — on a public works project in Cathedral City. Public works projects are defined as those that use more than $1,000 of public funds.
Bonta urged any union worker, employee or concerned citizen to report other potential labor law violations to the Justice Department. The workers on that initial Oakland site were not unionized, but reached out to the Nor Cal Carpenters Union for help addressing alleged shortcomings by their employer.
“It is no accident that California boasts the fifth-largest economy in the world,” Bonta said. “It’s because we’ve got some of the strongest worker protections in the country. It’s because, in California, we stand up for our workers.”
