Workers At The Arias Win Settlement For Unpaid Wages

Workers at a local luxury apartment building have settled with owners following a lawsuit over unpaid wages.

According to the agreement filed by Attorney General Eric T. Schneiderman, the owners of the Arias building — named as 150 Fourth Ave, LLC — located at 150-158 4th Avenue, claimed tax incentives from the city under Section 421-a of the Real Property Tax Law, which is meant to encourage development, but then failed to comply with the program’s prevailing wage and rent-regulation requirements.

In order to take the tax exemption offered under the 421-a program, buildings with more than 50 units — the Arias has 95 — are required to pay the prevailing wage rate to building service employees, or rent at least half of the building’s units at affordable rates. The settlement states the Arias failed to do either.

“Tax breaks offered to developers and landlords are not freebies. They come with legal obligations to New York taxpayers – ones that developers and landlords agree to abide by when they accept the tax incentives,” Attorney General Schneiderman said in a statement. “My office is dedicated to ensuring that everyone plays by the rules. In this case that means holding accountable those who accept lucrative tax exemptions and then ignore their responsibilities, including paying required wages to building service employees and providing rent-stabilized leases to New York families.”

The $500,000 settlement states that, prior to February of this year, about a dozen workers — who went on strike to protest conditions in 2013 — were paid $8.50 to $11 an hour, which is below the applicable prevailing wage rate, which started at over $16 per hour for a new employee. Additionally, it states that during that time period, these workers didn’t receive benefits, paid vacation, or sick time, which is another requirement of the prevailing wage law.

Those workers, who include doormen and porters, will receive $454,082 from the settlement; an additional $45,918 will be paid by the owners to the city fund for the tax benefits they received while they were out of compliance, between November 2010 and February 2014.

“Getting this back pay will make a big difference for me and my family, especially paying for my daughter’s college tuition,” Jose Casillas, a 46-year-old father of three and concierge at the Arias who is among the workers who’ll be receiving back wages, said in a statement. “The situation in our building has gotten much better in the last few months since we got our union contract and saw our pay go up to prevailing wage.”

This is one of four settlements with buildings around the city that the Attorney General’s office announced today as part of its ongoing investigation into property developers and landlords who have accepted tax incentives, but have failed to fulfill the requirements legally mandated by the program.