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Title company sued over alleged prevailing wage violations

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in Compensation and Benefits,Human Resources

The U.S. Labor Department (DOL) has filed suit against White Bear Lake-based Northwest Title, alleging the company failed to pay prevailing wages when it handled real estate closings for the U.S. Department of Housing and Urban Development (HUD). The company held the HUD contract from April 2010 to April 2012.

According to the lawsuit, North­­west Title Agency, under the leadership of Chief Operating Officer Joel Holstad and Chief Executive Officer Wayne Holstad, failed to pay the prevailing wage and benefits required under the federal Service Contracts Act (SCA). The suit resulted from a DOL Wage and Hour Division (WHD) investigation that revealed the company owed $230,688 in prevailing wage rates and fringe benefits to 10 workers.

WHD alleges the company failed to notify employees working on the contract of the SCA’s prevailing wage and benefit requirements. Addi­­tionally, the company allegedly failed to segregate employee hours between work performed on the HUD contract and other work. Com­­panies working on federal contracts in excess of $2,500 are required to pay prevailing wages and benefits.

Note: Federal money brings with it additional reporting and financial requirements and scrutiny. Before bidding on a federal contract, find out all record-keeping and financial requirements and factor those costs into the bid.

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