May 26, 2014
Contact: Jim OQuinn

Test Press Release

Labor advocates ask court to step into Marriott dispute

 Posted: 7:20 p.m. Tuesday, May 7, 2013


By Marty Toohey - American-Statesman Staff

The Austin-based Workers Defense Project is asking the courts to step into its wage dispute with the developers of the downtown Austin J.W. Marriott hotel under construction.

The worker advocacy group filed a petition Tuesday in state District Court in Travis County requesting pretrial depositions in which the group could question development firm executives under oath. This is a necessary step before asking a judge to suspend an economic development deal under which the city agreed to waive $3.8 million in fees, said Brian McGiverin, an attorney with the Texas Civil Rights Project who filed the petition.

Workers Defense Project and other labor advocates contend that the Marriott developer, White Lodging, is violating its agreement with the city by underpaying its construction workers. White Lodging executives have said that a high-ranking city official gave them permission to view the agreement as flexible because, after months of negotiations, the City Council added some requirements at the last minute. White Lodging did not respond Tuesday to a request for comment.

The city staff has been investigating the situation since late last year. If the staff concludes that White Lodging violated the agreement, the city could cancel the tax incentives. The city surveyed an unspecified number of the construction workers and found that 13 had been collectively underpaid almost $5,000. The city is waiting for further information from White Lodging, according to a statement Tuesday.

At the heart of the dispute is whether White Lodging should be required to pay all of its construction workers a “prevailing wage” during construction of the 1,000-room, $300 million building on Congress Avenue. The prevailing wage is a standard determined by the federal government based on what surveys say someone in a particular profession, such as a plumber or electrician, typically makes in a particular market.

White Lodging agreed to the prevailing wage provision in the incentive agreement. But the company later determined that it could not be reasonably expected to meet that requirement. Paying all of its construction workers a prevailing wage would cost the company more in wages than it would save in waived fees, according to White Lodging’s local representatives.

After the deal was signed, then-Assistant City Manager Rudy Garza approved a White Lodging plan to pay most employees above prevailing wages but some below that level, with the average wage 19 percent higher than the prevailing wage. But other city staffers later began the inquiry, saying Garza might not have been authorized to make such a decision.

Labor advocates say the company should have to follow the letter of the agreement.

“Developers need to keep their promises to taxpayers and workers, and the city must enforce its own rules,” said Kurt Cadena-Mitchell, a leader of Austin Interfaith, a multicongregation group pushing the city to establish a standard above minimum wage on construction projects that are granted economic development deals by the city.