In 2019, a significant event took place as unionized construction workers began to raise concerns about a particular company engaged in building luxury apartments in Oakland. This company seemed to be evading its financial responsibilities, not only towards the state but also towards its employees. This single tip would set in motion a prolonged investigation by the California Department of Justice. The Kentucky-based company, US Framing West Inc., was accused of violating state labor laws at the Oakland site and was also found to be engaging in tax evasion and wage theft at several other construction projects across the state. Some of these projects had received public funding.

Attorney General's Allegations and Charges

At a Tuesday news conference, Atty. Gen. Rob Bonta stated, "While working these projects, we allege US Framing West failed to pay more than $2.5 million in state payroll taxes. We also allege that, at a public works project in Cathedral City, US Framing West underpaid its workers by approximately $40,000." Bonta and his team have taken decisive action by filing 31 criminal charges against US Framing West and two of its employees. These charges include grand theft, payroll tax evasion, prevailing wage theft, and filing false documents. Bonta emphasized, "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. I'm here with a simple message: They cannot; no company can."

Employee Responses

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 Superior Court records. Gary S. Lincenberg, an attorney representing both English and the larger company, declined to comment on the specifics of the allegations but stated, "We intend to address the AG's concerns in court." He also said, "US Framing is a hard-working company with a great reputation." The attorney representing Krebs, Jeffrey Rutherford, said he and his client "intend to vigorously fight the charges."

Company's Work and Tax Issues

Between 2018 and 2022, US Framing West worked on several construction projects across the state, including in various counties such as Alameda, Los Angeles, Contra Costa, Orange, Riverside, San Diego, San Francisco, and Santa Clara. In many cases, the company used crews of unlicensed subcontractors. The state mandates that these subcontractors be classified as company employees, which triggers certain tax requirements. However, the company failed to appropriately file and submit taxes for these subcontractors. Additionally, investigators discovered that US Framing West failed to meet the requirements to pay a prevailing wage on a public works project in Cathedral City. A prevailing wage is typically a rate similar to that of unionized workers and is often significantly above the minimum wage for specialized jobs. Public works projects are those that use more than $1,000 of public funds.

Call for Reporting

Bonta urged any union worker, employee, or concerned citizen to report other potential labor law violations to the Justice Department. He emphasized, "It is no accident that California boasts the fifth-largest economy in the world. 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."