If a government agency contacts your business and warns you that you may be “facing steep sanctions,” you know this isn’t a good thing. If your construction business has been contacted by a federal, state, or local government agency, the first thing you should do is pick up your phone and call our Sarasota construction attorneys. At Cotney Construction Law, we defend contractors and other construction professionals in legal disputes, including cases that feature steep sanctions. If your business is at risk, we can offer you protection.
In this brief article, construction lawyers from our Sarasota construction law firm will outline a few of the most common types of sanctions business owners face when they are investigated by a government agency.
The Different Types of Sanctions
If you are just starting a construction business, you may not know what exactly is at stake when a government agency requests to visit your site for an inspection. Whether it’s a safety inspection, a workers’ compensation investigation, a wage complaint, or something else entirely, any of these incidents can result in a potential sanction.
The penalty for an infraction depends on a myriad of different factors, including the nature of the penalty itself, the governing agency investigating the claim, and whether or not the violation was willful or serious. Of course, there can be many other factors at play with a potential infraction, but the vast majority of infractions fall into the following categories:
The most common type of penalty is when a construction company is issued a fine or citation. For example, if your jobsite fails to be in compliance with safety rules and restrictions, an Occupational Safety and Health Administration (OSHA) compliance officer will visit your site and issue a citation. Similarly, if you fail to have workers’ compensation coverage for your workers, an agency in your state will issue a fiscal penalty and a stop-work order. In most of these situations, the fine will steadily increase until the issue is corrected. Financial penalties can add up quickly and even bankrupt a business. At Cotney Construction Law, our attorneys have experience reducing and even eliminating costly fines issued by agencies like OSHA.
Although it’s not the most common form of sanction in construction, some violations can be so egregious that a contractor faces a criminal penalty. This can occur in a safety-related incident where a worker or bystander is seriously harmed due to some form of negligence by a contractor. It can also occur in a wage and hour case if an employer violated child labor laws.
Criminal charges are also common for any type of financially motivated or fraudulent crime. For example, in workers’ compensation cases, if a contractor failed to report accidents or injuries, deliberately misclassified workers, falsified payroll records, or participated in any other form of fraudulent behavior, they may face a criminal penalty.
Related: Criminal Sanctions and OSHA
Although the most pressing concern for a business is preparing for the agency’s investigation when they are contacted, employees don’t have to report incidents directly to an agency. They can pursue a civil lawsuit against their employer. This is common in wage and hour cases and also workers’ compensation cases. There are many common civil suits in construction including:
- Breach of Contract: if a contracted party fails to comply with their signed agreement, this dispute can escalate to a civil lawsuit. This is especially common in payment disputes.
- Intellectual Property: whether it’s a building process, design, a piece of machinery, or even a businesses’ name or likeness, unauthorized use of intellectual property can lead to a civil lawsuit.
- Defamation: a business can be greatly impacted by libel or slander. You can pursue civil damages for defamation by filing a lawsuit.
As there is a lot at stake when you’re facing any form of sanction, to ensure the best interests of your business remain protected, consult the knowledgeable and experienced attorneys at our Sarasota construction law firm.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.