A.G. Schneiderman Announces General Contractor Will Pay $65,000 To Workers For Post-sandy Reconstruction Of Retail Stores

Emergency Contractor’s Employees To Be Compensated for Work Restoring Businesses Damaged By Hurricane Sandy

NEW YORK - Attorney General Eric T. Schneiderman today announced the resolution of an investigation into the underpayment of more than 100 workers performing emergency post-storm reconstruction work in several stores owned by national retailers, including Michaels Stores, Inc. and Staples the Office Superstore, LLC, in New York City and Nassau County. Under an agreement with the Attorney General, the emergency restoration contractor, InStar Services Group LP, has paid back wages and per diems totaling $65,000 for workers on the projects.

Shortly after Hurricane Sandy, InStar Services Group, LP, subcontracted with a recruiter to hire employees for post-Sandy emergency reconstruction work. The employees, some of whom came from the Rochester area and some from out of state, worked several days of twelve-hour shifts, but some were paid nothing at all, while others received only a fraction of what they were owed.

“These workers put in long days of hard labor to help New York businesses get back on their feet after Hurricane Sandy. It’s outrageous that they were not fully paid for all of their work, and I’m confident our agreement will help correct this injustice,” Attorney General Schneiderman said. “It will also put emergency reconstruction firms like InStar on notice to ensure that all employees on their worksites are paid according to the law.”

The Attorney General also advises emergency reconstruction firms and the businesses that use them to review their procurement policies to ensure that any subcontractors hired for disaster reconstruction work are responsible and lawful in their operations.

Under the agreement, the general contractor, InStar Services Group, LP, has paid $65,000, which will be distributed in full to the workers.  InStar sold its operations in December 2012 and no longer performs reconstruction work; however, the agreement contains additional requirements to ensure that if InStar renews operations in New York State, its subcontractors will comply with the law.”

The Attorney General thanked the Empire Justice Center for bringing the situation to the Office's attention.

Anne Erickson, President and CEO of Empire Justice Center, said, “In the chaos after Superstorm Sandy, companies and their subcontractors lured workers from across the state and region to do dangerous clean-up and rebuilding work necessary to get businesses back on their feet. We commend Attorney General Eric Schneiderman for standing by these workers and aggressively investigating this case. We also want to acknowledge the brave workers, who risked life and limb to respond to the devastation left in the storm’s wake, for coming together to fight not just for their rights, but for the rights of working people across the state whose labor we depend on in times of crisis.”

One worker, Richard Gomez, said this about the settlement: “A group of workers and I came to New York City after Hurricane Sandy because we wanted to earn money for the upcoming holidays for our families and to help out our fellow Americans. We worked hard but were treated unfairly. We want to thank the Attorney General for helping us and for bringing those who took advantage of us to justice.”

The case was handled by Volunteer Assistant Attorney General MiRi Song and Labor Bureau Section Chief Andrew J. Elmore under the supervision of Bureau Chief Terri Gerstein, Executive Deputy Attorney General for Social Justice Alvin Bragg, and First Deputy Attorney General for Affirmative Litigation Janet Sabel.

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