Laborers 42: BluSky Restoration using state and city tax credits to exploit out-of-state workers

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THE OLD WEBSTER SCHOOL building at 2127 North 11th Street in Old North St. Louis is being rehabbed for senior apartments. Laborers Local 42 says the contractor is using low-paid out-of-state workers despite receiving state and city tax credits for the project.

This is a story that should raise the ire of every Missouri worker and taxpayer.

BluSky Restoration, the out-of-state company currently rehabbing the Old Webster School Building at 2127 North 11th Street in Old North St. Louis for use as senior apartments, is using state and city tax credits to exploit out-of-state workers, paying them wages below area standards, reports Laborers Local 42 and the Laborers International Union of North America (LiUNA).

  • The Missouri Housing Development Commission, last year, approved $8 million in federal low-income housing tax credits, paid over 10 years, to assist the rent-controlled project. The state also approved about $2.2 million in historic tax credits.
  • The St. Louis Equity Fund will invest $9.4 million to finance the project.
  • The St. Louis Affordable Housing Commission is making a loan of $500,000 on the project.
  • In addition, the project has a 15 year 100 percent tax abatement and an additional five year tax abatement of 50 percent.

BluSky Restoration Contractors does not have a contract with local laborers unions affiliated the Missouri-Kansas Laborers’ District Council (MKLDC), which guarantee workers a living wage, healthcare, a retirement plan, and safety and skills training for the workers they represent.

License plates of workers on the Old Webster School project appear to be almost all from out-of-state.

The building rehab is currently in the asbestos abatement stage, but observations of the property show little to no hazardous material waste bags for disposal of the asbestos material.

With low-income seniors slated to live there when the project is finished, there is legitimate concern over whether this vulnerable, elderly population can trust they won’t get sick from living there, says Brandon Flinn, MKLDC and Laborers Local 42 business manager.

“St. Louis City and the state of Missouri continue to evaluate their process of tax credits and tax dollars financing projects,” said Flinn. “Our tax dollars should not go to a company like BluSky when they are exploiting minority workers from out-of-state,” he stressed. “Our tax dollars should go to contractors that use our tax dollars responsibly and hire local workers.”

BluSky has ties to another notorious company – GenCorp Services, which was the primary contractor for demolition and asbestos abatement on the Last Hotel project on Washington Ave. in St. Louis, where two workers fell to their deaths in an elevator shaft in 2018.

Carlos Escobar, a Laborers Local 42 member and organizer, spoke with workers on the Old Webster School project who told him they were being supervised by two men, formerly of GenCorp, who are now working with BluSky, using their previous connections to bring low-paid and questionably trained out-of-state workers into St. Louis.

Escobar said he gave the workers his business card and offered to meet with them to talk again. In a bit of serendipity, one of the workers gave the card or Escobar’s phone number to someone with GGG Labor Services and the company called Escobar later that day asking if he was looking for workers, he said.

Despite Escobar explaining that he was with a Labor union, the woman from GGG proceed to ask how many workers he needed.

“She said well how many guys do you need, 100 or 200? We’ll get them by next week, as many as you need.”

Escobar asked if the workers were certified to work in the state of Missouri, and this is what she told him:

“She said, ‘Don’t worry about that. We will supply you with all the papers required, We’ll make sure they have all the paper that is required to do the work.’

“This is really dangerous,” Escobar said. “If you don’t have the proper training and the equipment to do this kind of work, it’s very dangerous and I feel like these companies don’t care.”

Escobar is careful to note that he doesn’t know for certain whether or not the workers are properly trained, but his conversations with the workers and GGG Labor Services left him with the sense that neither knew what he was talking about.

“It’s not like there aren’t workers available in the St. Louis area,” he said. “We have hundreds of workers who are qualified and properly trained to do this kind of work. It’s not like BluSky has to go out of state to find these workers. Our members are not only trained, they receive family-supporting wages, retirement, health insurance. They are trained, and have everything that is required. So there’s no excuse for these companies to go out of state to find this kind of workers.

“It’s not only the story of these guys,” he said. “This happens all the time. These companies that manage these workers, some of the workers don’t even speak English. I don’t know if that’s got anything to do with it, but it shouldn’t be a reason for them to take advantage of them. They lower the wages in the states everywhere they go. And by doing that, they not only hurt these employees that they’ve got working for them, they also hurt the employees that we have in our area that are qualified and certified to do this kind of work, lowering the standards for everyone. It’s just not fair.”

BluSky has a history of exploiting workers

BluSky has a history of exploiting workers to benefit its bottom line.

BluSky and staffing agency Labor Source LLC are currently being sued in Minnesota by a group of workers from Chicago who were recruited to a BluSky project in St. Paul, Minn. The workers allege violations of the Fair Labor Standards Act including failing to pay minimum wage, not paying time and a half for overtime, and making improper and oversized deductions for lodging and other travel expenses.

The workers in Minnesota said they did not consistently receive pay stubs, and in some instances allege their time sheets were fabricated by BluSky personnel. The case is still pending with BluSky attempting to get the class action limited to only its projects in Minnesota.

You can view the lawsuit at

BluSky also has come under fire from a jobsite in Cedar Rapids, Iowa where workers and community members are calling for $30,000 in unpaid wages to workers.

The workers at the Cedar Rapids site described shocking conditions that suggested a variety of legal violations, including:

  • Nonpayment of wages and overtime. In nearly a month of work for Ramirez and BluSky, the workers said they only received wage payments once, in the second week – a cash payment that averaged just over $200 per worker, far less than they were owed at that point.
  • Inadequate and unsafe housing. The workers said they were all housed together in one two-bedroom/one-bath apartment in a building that had sustained storm damage. Their apartment lacked a ceiling (it had plastic in place of a ceiling) and was cold. They slept on the floor on air mattresses the workers had individually purchased.
  • Lack of medical care for workplace injuries. One worker was asked to perform electrical wiring work for which he was not trained or certified. His finger was split open in the process, and the supervisor did not provide any medical care when he reported the injury.
  • No paystubs or written statements of hours worked, amount earned, and deductions made. Iowa law (Iowa Code, Chapter 91A) requires this, regardless of method of payment.
  • Unregistered subcontractor – Painting & Demolition Ramirez Company. All individual contractors and businesses performing construction work within Iowa must be registered if they earn more than $2,000 per year, to ensure compliance with unemployment and workers’ compensation laws, and must file a bond if they are based out-of-state. Painting & Demolition Ramirez Company does not appear to be registered with the State of Iowa.
  • Threats and retaliation against workers for exercising wage payment and concerted activity rights. The workers described that the previous week they had collectively stopped work and met with Pablo Ramirez to insist on being paid. In response, Ramirez told the workers he would “punish” them as a result of their action, and they would not receive any pay for that week.
  • Failure to provide PPE, including masks. The workers were directed to handle insulation, among other tasks, but they were not provided masks for that purpose or to protect against COVID-19.



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