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NYC Council Passes Bill to Regulate ‘Body Shops’

NEW YORK, N.Y.—The City Council on Nov. 10 overwhelmingly passed a bill to regulate so-called “body shops,” labor brokers who supply low-wage workers to nonunion construction jobs.

The vote was 40-2. Speaker Corey Johnson (D-Manhattan), noting that body shops typically hire recently released prisoners who can be sent back for violating parole if they don’t have a job, told the Council that creates a “power imbalance that can result in dangerous working conditions.”

The two no votes came from Staten Island Republicans Joseph Borelli and Steven Matteo.

The bill, sponsored by Councilmember Diana Ayala (D-Bronx/Manhattan), had been a top priority for Laborers Local 79 and the Mason Tenders District Council. “Body shops take advantage of the scarcity of employment opportunities for re-entry workers, and effectively force these workers into dangerous, low-wage jobs with no training,” Ayala said in a statement.

“I’m glad the City Council has listened to the stories and struggles of formerly incarcerated workers like me,” Local 79 member John Simmons, a former body-shop worker who was active in the union’s campaign for the bill, said in a statement. “For too long the body-shop system of exploitation has operated in the shadows, on construction sites throughout our city. For too long, we’ve been told that any job, no matter how unsafe and poorly paid, is better than no job. No more.”

The measure would work by requiring “construction labor providers” to obtain licenses from the city. It defines them as a person or business who gets paid to employ and supply workers for a third party’s construction job, and are not the general contractor, subcontractor, or an employment agency. 

Those providers would have to give workers written notice about their rights on the job, such as minimum wage, overtime pay, and safety, and about the certifications they need to do the tasks they were hired for or are asked to do. They would also have to give a written “notice of assignment” that includes the name of the company they’ll be working for, what equipment is required for the job, how many hours they’ll be working and how much they’ll get paid, and the name and insurance-policy number of whoever’s providing workers’ compensation. 

Providers who operate without a license would be fined $500 a day, and contractors who knowingly hire workers through them could be fined up to $500 a day. (Being shown a fake license would be a valid defense, but not asking to see a license wouldn’t.) Individual workers could also sue the provider for failing to give them the required notices and for retaliating against them for seeking their rights under the law.

To get a license, a provider would have to list details about their ownership and officers; certify that they are complying with labor laws and have no outstanding fines or warrants for violations; and show that they are maintaining insurance coverage for liability, workers’ compensation, unemployment benefits, and disability.

To renew a license, they will have to give the city information on how many workers they’ve employed while their current one was in effect, as well as their average hourly wages and benefits. They would also have to list the names of every client they’ve provided workers for, and the addresses of every jobsite they sent workers to and for which client.

The city could revoke their licenses if they’ve failed to supply that information, and also for having multiple violations; failing to pay a fine or satisfy a civil penalty; failing to answer summonses or other requests from the city; and for being found guilty of “egregious or repeated nonpayment or underpayment of wages.”

The legislation also contains provisions to prevent body shops from dissolving and reopening under a new name. It allows the city to revoke the licenses of “successors” to companies that had their licenses revoked or had enough violations to deserve it. It defines “successor” as a construction labor provider that uses the same facilities or workforce as a previous provider; shared in its ownership; offers substantially the same services; employs the same managers; or includes immediate family members of its owners or officers.

“General contractors can no longer pretend they are unaware of the exploitation of formerly incarcerated New Yorkers in the construction industry,” Mason Tenders’ District Council President Mike Hellstrom said. “Through this law, real re-entry will come to replace exploitative re-entry, and more construction laborers will be put on the path to economic security. We urge outgoing Mayor Bill de Blasio to sign this law immediately and incoming Mayor Eric Adams to enforce it aggressively.” 

The Council also passed several other construction-safety bills, including one that would beef up supervision at “major building construction sites,” and another that would lower the size of a “major site” to buildings either seven stories or 75 feet tall.

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