Construction Boom’s Dark Side
Hawaii’s construction market is operating at a blistering pace. That has some contractors cutting corners — and the fines are piling up. We get more on that story from Pacific Business News editor in chief A. Kam Napier.
Both the state Department of Labor and Industrial Relations and the Department of Commerce and Consumer affairs have gotten more aggressive about investigating problems in the construction industry. At just one project last year, a Waikiki hotel called Maile Sky Court, DLIR fines topped $1 million dollars. Hotels guests were confronted with unsafe conditions as renovations proceeded without buffers between the work and the guests.
DCCA levied more than $200,000 in fines last year. The highest, $50,000, went to a firm working on the Coach store in Ala Moana Center. Horizon Retail Construction failed to have a responsible managing employee in residence in Hawaii and allowed unlicensed subcontractors onto the project.
In fact, many of the DCCA fines last year were levied on firms for not having managers in residence in Hawaii. There’s a great deal of construction happening on Oahu right now and at a time Honolulu has the highest construction costs in the nation. The amount of work available has attracted Mainland companies to jump in and bid on projects, starting the work before they have managers in place.
Contractors have taken multiple commitments to complete projects on deadline, but are finding it difficult to find qualified labor. Consequently, some are turning to unlicensed labor. To curb abuses, state authorities have ratcheted up not only their investigations, but the fines as well. For example, companies that fail to provide temporary disability insurance to workers used to receive a fine a $1 per day per affect employee. That fine is now $100 per day per employee.