The contractor who turns in the false payroll paperwork can pay, and pay a lot. The Appeals Court upheld a judgment of about $927,000 against a public works subcontractor that used certified payrolls falsely stating its carpenters were paid the prevailing wage, even though a lower tier company actually did the hiring and underpaid the workers. This is an unpublished Appeals Court decision under Rule 23.0, which courts may cite as persuasive but not as binding precedent.
What happened
A construction company won the carpentry subcontracts on two public works projects, in Westport and Middleborough. The contracts required prevailing wages, which for carpenters were $66.68 an hour, and weekly certified payroll reports. The company hired another firm to supply the labor, and that firm got carpenters through a third company and paid them below the prevailing wage. The company never checked the records or asked questions, even though the reported wages at one point exceeded the labor firm’s whole contract price. It used thirty-two certified payroll reports, all falsely stating the workers were paid correctly, to get paid on both jobs. After the Attorney General’s Fair Labor Division received a complaint about the pay, the Commonwealth investigated and sued the company under the Massachusetts False Claims Act. The labor firm admitted it paid no worker the prevailing wage on either job and settled with the Commonwealth.
What the court decided
In Commonwealth v. BPI Construction Management, Inc., No. 24-P-754 (Mass. App. Ct. June 20, 2025) (Rule 23.0 decision), the Appeals Court affirmed the full judgment against the company.
Using a false payroll is enough. On public works, contractors and subcontractors must keep accurate payroll records and submit certified payrolls every week, and no one may pay less than the scheduled rates. G.L. c. 149, §§ 27, 27B. The False Claims Act makes a person liable for knowingly making or using a false record material to a false claim for payment. G.L. c. 12, § 5B (a) (2). The court held the Commonwealth did not have to prove the company prepared the false payrolls itself. It was enough that the company was responsible for them and used them to get paid, with deliberate indifference or reckless disregard for whether they were true.
The company could not pull in other parties. The company argued the general contractors and the labor firm had to be added to the case. The court said the Attorney General decides whom to sue. G.L. c. 12, § 5C. The court also agreed with the trial judge, who looked to federal cases under the federal False Claims Act, that the company had no right to contribution or indemnity from the others, and relabeling those claims as contract or unfair practices claims did not help.
No tort settlement credit. The company said the labor firm’s settlement should wipe out its own liability under the joint tortfeasor statute, G.L. c. 231B, § 4. The court disagreed. A false claims case is not a tort case, so that statute did not apply.
How the damages were figured. The actual damages were the $256,539.92 the workers were underpaid. The judge tripled that first, then subtracted the labor firm’s restitution payment, leaving $513,079.84 in compensatory damages. That order of steps follows United States v. Bornstein, 423 U.S. 303 (1976). The company got no credit for the penalties the labor firm paid. The final judgment of $926,898.06 included those damages, $226,752 in statutory penalties, $72,000 in attorney’s fees and $280 in filing fees.
What this means for you
If you work on a public building, school, road or other public project in Massachusetts, you are entitled to the prevailing wage for your job classification. That rate is set in advance by the state for each job. Every week your employer has to put your hours and pay on a certified payroll and sign a statement that it is correct.
This case shows that companies up the chain cannot hide behind a labor broker. A contractor that signs off on or uses false payrolls can be held responsible for three times the damages plus penalties. It also shows that a single complaint can start an investigation that reaches every company on the job.
What to do now
- Ask what job classification you are working under and what the posted prevailing wage rate is. The schedule must be posted at the job site.
- Keep your own record of the days and hours you work, the project name and who pays you.
- Save every pay stub, check image or record of cash payments.
- If your pay is below the posted rate, you can file a complaint with the Attorney General’s Fair Labor Division.
- Get advice about private wage claims, because deadlines apply.
If this is your situation, call Doubleday Law at (617) 575-2006 or tell us what happened. Deadlines for discrimination and employment claims can be short.
Prior results do not guarantee a similar outcome.
