Labor Group Alleges 'Wage Theft' at Summit Grove Affordable Housing Project

Subcontractors blamed in two complaints

Published : Tuesday, December 19, 2017 | 6:33 AM

Summit Grove is a low-to-moderate affordable income project

Summit Grove is a low-to-moderate affordable income project being built by nonprofit Heritage Housing Partners at the corner of Summit Avenue and Orange Grove Boulevard.

Local labor groups and some workers at Pasadena-based Heritage Housing Partners’ Summit Grove affordable housing project plan to hold a rally and press conference at the site Tuesday to announce the filing of a California Labor and Workforce Development Agency complaint against RAAM Construction, Inc. and Ramari Business Consulting LLC, two sub-contractors on the project.

The action is being organized by Pasadenans Organizing for Progress (POP) and the National Day Laborer Organizing Network (NDLON).

The Summit Grove project is being built at the corner of Summit Avenue and Orange Grove on the former site of a nuisance liquor store which attracted crime and trouble for years. With City help, nonprofit Heritage Housing Partners was able to buy the property and evict the liquor store, and the neighborhood celebrated. In its place, Heritage Housing is constructing one 2-bedroom affordable apartment unit, and 20 3-bedroom units moderate- and low-income units.

According to POP spokesperson Lizbeth Mateo, two Summit Grove construction workers are seeking unpaid wages and fines claiming there is “pervasive and systemic wage theft” at the construction sites. POP has filed a complaint with the Labor Commission, said Mateo, and will now wait 30 days for a decision on the merits of the case. Should the Labor Commission not pursue the case, POP attorneys will file a lawsuit directly against RAAM Construction, Inc. and Ramari Business Consulting, she said.

The owners of RAAM denied knowledge of any acts of wage theft. Ramari Business Consulting officials could not be reached for comment.

“We have evidence (of wage theft),” said Mateo on Monday, “and we’re ready to continue this case all the way up to the courts, if necessary. (The workers) simply want justice. They want to get paid what they work for. And I’m not sure if this has happened to other workers.”

Mateo also voiced concern that such allegations should arise in connection with a low-income housing project.

“This is especially troubling,” she noted, “because it’s an affordable housing project. It’s supposed to be houses are for people low income folks like the workers that are actually building the houses. You can’t build affordable housing on the fact that low wage workers by cheating them out of their paychecks.”

According to Mateo, several of the alleged violations in question are infractions of both the California labor code as well as City’s new Minimum Wage Ordinance.

POP Attorney Dale Gronemeier noted that any lawsuit would not directed at Heritage Housing Partners, adding, “We have no reason to believe that Heritage Housing Partners knew about the wage (violations).”

Charles Loveman, executive director of Heritage Housing Partners, said in a statement to Pasadena Now on Monday that “HHP does not condone nor tolerate wage theft in any way. HHP’s mission is providing for-sale affordable
housing to low and moderate-income households, the very same households who can be vulnerable to wage theft given the economic challenges they may face. These are the type of households we work hard to support and provide affordable homeownership opportunities. HHP will cooperate with all relevant parties in an effort to determine the truth of these allegations and extent of wrongdoing, if any.”

Loveman added, “HHP has worked with the general contractor involved in the matter, RAAM Construction Inc. of Pasadena, for more than a decade. During that time, RAAM has built most of HHP’s affordable homeownership projects,
including Fair Oaks Court, Haskett Court, Doran Gardens, Guilford Court, and Highland Mews. During all our time working with RAAM, we have never been made aware of any issues regarding unfair labor practices or illegal treatment of workers at our project sites. HHP will continue to assist to make sure that workers at our project sites are not only fully paid in accordance with the
law, but also that the work environment is consistent with HHP’s values.”

RAAM, one of the two sub-contractors accused of wage theft, was adamant in denying knowledge of any acts of wage theft.

“RAAM is deeply troubled by the allegations that it or its subcontractors engaged in wage theft or committed any other violation of California’s or Pasadena’s labor laws,” said owner Richard Lara, in a statement Monday.
“RAAM is a company that my wife and I started. Lisa and I both come from backgrounds that clearly define who we are and how we strive to treat our employees.”

Continued Lara, “We are proud to be children of Mexican immigrants who worked hard their entire lives to provide for their families. My wife’s mother and grandparents were farm workers who made ends meet through hard labor, traveling throughout California to pick crops for their employers. In turn, my parents struggled to put food on the table for a family of 6, and my father’s minimum wage, $3.50/hour paychecks are seared into my memory.”

According to Lara, RAAM is currently in the process of investigating the allegations made, but has been “hampered” in its efforts by the two named claimants’ and their lawyers’ failure to cooperate in the investigation by repeatedly refusing to provide documents or any other evidence that supports the claimants’ own statements, or by simply ignoring RAAM’s multiple requests for any such evidence.

Lara said that the workers involved “have also changed their story, and the inconsistencies increase the difficulty of our investigation.”

According to Lara, the two claimants (who have not yet been named) alleged that they did not receive the minimum amount of pay required by Pasadena’s minimum wage ordinance, but have now dropped that claim.

Concluded Lara, “Despite the roadblocks that the claimants, themselves, have placed before RAAM, we will persevere in our investigation, and if RAAM discovers any actual wrongdoing, we will right those wrongs and hold those responsible accountable. This has been, and will continue to be, RAAM’s consistent position since having first learned about these allegations a relatively short while ago.”

Representatives of Nevada-based Ramari Business Consulting LLC were not available for comment by press time.

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