Hundreds of construction workers who helped build some of the District's biggest recent projects are getting money back after a company accused of shortchanging them agreed to a $1.7 million settlement. W.G./Welch Mechanical Contractors will pay roughly $691,450 directly to about 500 workers, plus $1 million in penalties to the District, after allegations that it misclassified employees to avoid paying overtime and benefits.
The deal stems from a lawsuit accusing Welch, three labor brokers and general contractor Whiting-Turner of cutting labor costs by classifying employees as independent contractors rather than employees, according to WJLA. That classification, the lawsuit said, meant workers missed out on overtime pay, paid sick leave and other benefits they were owed under D.C. law. D.C. Attorney General Brian Schwalb announced the settlement, saying, “Today we're putting money back in the pockets of construction workers who were denied wages and benefits they were entitled to receive.”
Welch worked on major construction projects across the District, and the station's report ties the case to work at City Ridge, a development on Wisconsin Avenue NW that involved more than 250 workers. According to filings cited by FFC-MAR, Welch executed a $19 million subcontract for City Ridge, which is described as a 360,000-square-foot mixed-use development anchored by the District's first Wegmans Food Market and a 690-unit residential building. The same filings show Welch held mechanical-services contracts worth more than $11 million and $5 million for the 40 Patterson and 1000 South Capitol projects, respectively.
How the Payout Will Reach Workers
Per the same account, eligible workers will be contacted by a settlement administrator within 60 days after a court enters the consent order. The lawsuit against Welch was filed in 2024, and the case had named the company alongside the labor brokers and Whiting-Turner as part of the alleged scheme.
The Welch case is not an isolated action. WUSA9 reported that a 2019 analysis by the D.C. Attorney General's Office found that misclassification can illegally reduce a construction company's labor costs by as much as 40%, a structural incentive that has shown up repeatedly in enforcement cases across the city's building boom.
Part of a Broader Enforcement Push
The Office of the Attorney General secured a separate $1.5 million settlement from Brothers Mechanical in December, which included $500,000 for affected workers and $1 million in penalties, according to the D.C. Office of the Attorney General. In a larger 2024 case, Power Design agreed to pay more than $1.7 million to over 1,200 workers and more than $1.2 million in penalties to the District, a settlement the agency described as the largest of its kind in the District, as reported by NBC Washington. Those workers had to complete a claims process before receiving payment, the outlet noted. NBC Washington also reported that the Attorney General's Office said it had secured $14 million for D.C. workers since January of the previous year.
What the Law Requires
D.C. Code states that an employer shall not improperly classify an individual who performs services for remuneration as an independent contractor, a standard laid out in the D.C. Code. In its original lawsuit, the Attorney General's Office alleged that Welch and other defendants misclassified workers as independent contractors, denying them minimum wage, overtime pay and sick leave, according to the D.C. Office of the Attorney General. The suit had sought restitution and penalties while aiming to force all five defendants to comply with District workplace and wage laws, per FFC-MAR.
