Hiring On-Site Labor: Construction Businesses Must Step Carefully

Hiring On-Site Labor: Construction Businesses Must Step Carefully 03.31.2026 HR & Safety The following article was first posted in the Insights section of Whittlesey’s website. It is reposted here with permission.  It’s no secret that the construction industry has been struggling with a skilled labor shortage for years now. More recent events, such as the pandemic and “the Great Resignation,” have only exacerbated matters. The situation can drive a contractor to desperation if work really needs to get done and there aren’t enough able hands available. Construction businesses may also encounter financial constraints that dissuade them from adding employees to the payroll, leaving them to consider other alternatives. Be careful: These factors can add up to disastrous decisions that land companies in serious legal trouble. For an example, one need look no further than the recent case of Walsh v. Resto et al. Investigation Launched The case in question arose from an investigation by the U.S. Department of Labor’s Wage and Hour Division. The investigation found that a construction staffing agency and its owner had hired workers—as finishers, loaders, operators and carpenters—and intentionally misclassified them as independent contractors. The workers were paid “straight time” for all hours, with no overtime, in violation of the Fair Labor Standards Act. The company also failed to maintain proper records of hours worked. The company also failed to maintain proper records of hour...