April 28, 2008

Leader of Carpenters union to testify at hearing on underground economy being held by Senator Kerry

Mark Erlich, Executive Secretary-Treasurer of the New England Regional Council of Carpenters, will provide testimony to a hearing being held by Massachusetts Senator John Kerry Monday, April 28 in Chelsea. The hearing will begin at 10 am at the Chelsea Campus of Bunker Hill Community College, located at 175 Hawthorne Street in Bellingham Square. Senator Kerry is holding the hearing as part of his role as Chair of the United Senate Committee on Small Business and Entrepreneurship.

Last year Massachusetts-based contractors Sarah Stafford of Stafford Construction Services in Saugus and John Kendzierski of Professional Drywall Construction in Springfield testified before a House Ways and Means hearing in Washington on the issue. Both cited the difficulties in competing in the construction industry against companies who cheat by contributing to or taking advantage of the underground economy to gain a competitive edge.

Federal data shows that the underground economy-consisting of workers being paid in cash or misclassified as "independent contractors" account for a significant percentage of the nation's "tax gap." A study by Harvard and the University of Massachusetts, Boston found that hundreds of millions of dollars are lost by underreported and underpaid state taxes through misclassification of workers as "independent contractors." The study did not include estimates of further lost state revenue as a result of workers being paid in cash.

The underground economy is being targeted at the state level by Massachusetts Governor Deval Patrick and Attorney General Martha Coakley. On March 12 Governor Patrick signed an Executive Order creating a task force to limit activity in the underground economy, which exploits workers and deprives the state of needed revenue.

Erlich has been a leading voice in calling for greater enforcement of state and federal laws that govern wage and hour laws as well as worker classification in the construction industry. He has been featured in numerous print and television stories on the subject as well as publishing opinion pieces in the Boston Globe.

 

http://www.necarpenters.org/