Firms working on General Assembly building face embezzlement charges

Two subcontractors that have been working on the construction of the Virginia General Assembly Building are facing worker misclassification charges.

GTO Drywall, LLC and Richmond Drywall Installers Constructors Inc. were indicted on 10 counts of felony embezzlement each by the Richmond Metropolitan Multi-jurisdiction Grand Jury.

The indictments are related to alleged misclassification of workers by both subcontractors in an attempt to avoid withholding premiums for workers’ compensation and avoid paying various taxes to the Commonwealth.

The Worker Protection Unit worked with an investigator from the Office of the State Inspector General, after the alleged illegal conduct was brought to the attention of the Unit.

These are the first worker misclassification charges brought by the Worker Protection Unit since its creation earlier this year.

Worker misclassification – one of the most common forms of worker exploitation – involves falsely identifying individuals as “independent contractors” when they are really employees. This allows employers to avoid paying unemployment and other taxes on workers and to avoid the costs of covering the employees with workers’ compensation and unemployment insurances, and it has been consistently shown to drive down the wages of other workers.