The Department of Labor, Politico reports, is currently investigating whether workers at Donald Trump’s high-profile renovation of Washington, D.C.’s Old Post Office into a luxury hotel are being paid less than federal law mandates.
Located just a few blocks from the White House, Trump is leasing the building from the federal government—which makes it a government construction project covered by the Davis-Bacon Act. The law requires that all workers on a project be paid a prevailing wage—that is, the hourly wage (usually set by unions) paid to the majority of workers working in an area. This applies to both union and non-union labor.
But workers from several Trump Organization subcontractors said they were not being paid the prevailing wage. A spokesperson for the General Services Administration confirmed that “the Trump Organization is required to comply with Davis-Bacon and this includes subcontractors working at the project.” But according to Politico, Trump may not be liable:
Should a subcontractor be found in violation of wage laws by the Labor Department or some other investigating body, the Trump Organization won’t likely be on the hook legally. The project’s general contractor, Lendlease, may share some liability, and a GSA spokesperson said that if the subcontractors’ alleged violations proved serious enough, the Trump organization might choose to terminate its contract with Lendlease.
“Lendlease is not aware of either of these allegations,” said a spokesperson who declined to be identified by name, “or of any investigation. When raised through appropriate channels, Lendlease takes these issues very seriously.”
The spokesperson added that the company’s subcontractors were “required to submit weekly certified payroll reports certifying their compliance with the prevailing wage obligations in their contracts with the Trump Organization.”
Still, Trump knew or should have known his general contractor has faced legal problems before. In March 2015, Lendlease and a subcontractor paid $400,000 to settle allegations that it had filed false claims to the government, and in 2012 the company paid $56 million rather than face criminal prosecution after the feds charged that it had “intentionally and fraudulently billed clients, from at least 1999 to 2009, for hours that were not worked by labor foremen.”
Last fall, the Washington Post reported that the Old Post Office renovation is heavily reliant on undocumented workers. The project is also at the center of a flurry of lawsuits between Trump and chefs at the hotel restaurant who are trying to back out of their contracts with the presumptive Republican nominee.
Trump held a campaign event at the construction site in March. “When it’s completed,” he said, “it will be truly one of the great hotels of the world.” The Labor Department confirmed that the investigation is ongoing.