The Real Deal New York

Contractor tied to labor probe tapped for public housing repairs

December 09, 2013 11:15AM

The New York City Housing Authority hired Long Island-based contractor MDG Design & Construction last month to repair 874 of its apartments — despite federal charges that the firm violated several labor laws.

In May, MDG was accused of letting subcontractors bilk construction workers out of millions of dollars on a $60 million Grand Street Guild federal housing project in the Lower East Side. Three workers on the project filed a class action suit in October, alleging they received no more than $50 per day and were instructed to hide from inspectors. 

The U.S. Department of Labor sought to bar MDG from bidding on federal projects through 2016. But the city is nevertheless requesting MDG’s services for work in Manhattan, Brooklyn and the Bronx.

MDG principal Michael Rooney told the New York Daily News that subcontractors made underpayments on the Grand Street Guild project without the contractor’s knowledge.

“MDG has zero tolerance for labor law violations,” Rooney said. “There is no allegation that MDG was aware of, condoned, or participated in the violations of its subcontractors. MDG is confident that there will be no findings … that MDG engaged in any misconduct.” [NYDN]Mark Maurer