§ 235. Investigation and hearing. 1. Whenever the fiscal officer has
reason to believe that a service employee has been paid less than the
wages stipulated in the contract, or if such contract has no wage
schedule attached thereto and the fiscal officer has reason to believe
that a service employee has been paid less than the wages prevailing for
his craft, trade or occupation, the fiscal officer may, and upon receipt
of a written complaint from an employee employed thereon, shall conduct
a special investigation to determine the facts relating thereto.

2. a. At the start of such investigation the fiscal officer may notify
the financial officer of the public agency interested who shall, at the
direction of the fiscal officer, forthwith withhold from any payment due
to the contractor executing the contract sufficient money to safeguard
the rights of the service employees and to cover the civil penalty that
may be assessed as provided herein, or, if there are insufficient moneys
still due or earned to the contractor or subcontractor to safeguard the
rights of the service employees and to cover the civil penalty that may
be assessed as provided herein, the financial officer of another civil
division which has entered or subsequently enters into a building
service work contract with the contractor or subcontractor, who shall
withhold from any payment due the contractor or subcontractor executing
any building service work, sufficient moneys to safeguard the rights of
the service employees and to cover the civil penalty that may be
assessed as provided herein.

b. If there are still insufficient moneys still due or earned to the
contractor or subcontractor to safeguard the rights of the service
employees and to cover the civil penalty that may be assessed as
provided herein, the financial officer shall immediately so notify the
fiscal officer, who may issue a notice of withholding to any of the
following: any substantially-owned affiliated entity or successor or
subsidiary of the contractor or subcontractor; an officer of the
contractor or subcontractor who knowingly participated in the violation
of this article, any of the partners, if the contractor or subcontractor
is a partnership, or any of the five largest shareholders of the
contractor or subcontractor, as determined by the fiscal officer.

c. The notice of withholding shall provide that the fiscal officer
intends to instruct the financial officer, not less than ten days
following service of the notice by mail, to withhold sufficient moneys
to safeguard the rights of the service employees and to cover the civil
penalty that may be assessed as provided herein, from any payment due
the notified party under any building service work contract pending
final determination. The notice of withholding shall provide that within
thirty days following the date of the notice of withholding the notified
party may, contest the withholding on the basis that the notified party
is not a partner or one of the five largest shareholders of the
subcontractor or contractor, an officer of the contractor or
subcontractor who knowingly participated in the violation of this
article, a substantially-owned affiliated entity or successor. If the
notified party fails to contest the notice of withholding, or if the
fiscal officer, after reviewing the information provided by the notified
party in such contest, determines that the notified party is a partner
or one of the five largest shareholders, a substantially-owned
affiliated entity, an officer of the contractor or subcontractor who
knowingly participated in the violation of this article, or a successor,
the fiscal officer may instruct the financial officer to immediately
withhold sufficient moneys to safeguard the rights of the service
employees and to cover the civil penalty that may be assessed as
provided herein from any payment due the notified party under any
building service work contract pending the final determination.

d. The financial officer shall immediately implement the notice of
withholding and confirm in writing to the fiscal officer the amount of
money withheld.

e. If the notified party contests the withholding after a withholding
has been effected, and if the fiscal officer determines that the
notified party is not a partner or one of the five largest shareholders,
a substantially-owned affiliated entity or successor, an officer of the
contractor or subcontractor who knowingly participated in the violation
of this article the fiscal officer shall immediately notify the
financial officer to release all payments being withheld from the
notified party.

f. The money shall be held in trust pending completion of the
investigation.

3. If, despite the requirements of law, the contract for the service
work has been awarded without the annexation thereto of the schedule of
wages provided for in this article, the fiscal officer shall determine
in the proceeding before him the wages prevailing at the time the work
was performed for the crafts, trades or occupations of the employees
involved.

4. In an investigation conducted under the provisions of this section,
the inquiry of the fiscal officer shall not extend to work performed
more than two years prior to: (a) the filing of the complaint, or (b)
the commencement of the investigation upon the fiscal officer's own
volition, whichever is earlier in point of time.

5. a. The investigation and hearing shall be expeditiously conducted
and upon the completion thereof the fiscal officer shall determine the
issues raised and shall make and file an order in his office stating
such determination and forthwith serve personally or by mail a copy of
such order and determination together with a notice of filing upon all
parties to the proceeding and upon the financial officer of the public
agency involved.

b. In addition to directing payment of wages found to be due, such
order of the fiscal officer may direct payment of a further sum as a
civil penalty in an amount not exceeding twenty-five percent of the
total amount found to be due. In assessing the amount of the penalty,
due consideration shall be given to the size of the employer's business,
the good faith of the employer, the gravity of the violation, the
history of previous violations of the employer, successor or
substantially-owned affiliated entity or any successor of the contractor
or subcontractor, any officer of the contractor or subcontractor who
knowingly participated in the violation of this article, and any of the
partners if the contractor or subcontractor is a partnership or any of
the five largest shareholders of the contractor or subcontractor, as
determined by the fiscal officer, of such underpayment of wages or
supplements, and any officer of the contractor or subcontractor who
knowingly participated in the violation of this article, and the failure
to comply with recordkeeping or other non-wage requirements. Where the
fiscal officer is the commissioner, the penalty shall be paid to the
commissioner for deposit in the state treasury. Where the fiscal officer
is a city comptroller or other analogous officer, the penalty shall be
paid to said officer for deposit in the city treasury.

c. If the order directs the payment to specified employees of wages
found to be due and unpaid, including interest at a rate not less than
six per centum per year and not more than the rate of interest then in
effect as prescribed by the superintendent of financial services
pursuant to section fourteen-a of the banking law per annum from the
time such wages should have been paid, the financial officer of such
public agency shall, upon the service to him of such order, pay to such
employees from the trust money withheld the amounts specified in such
order and shall pay the civil penalty as provided herein, provided no
review proceeding pursuant to the provisions of article seventy-eight of
the civil practice law and rules is commenced within thirty days of the
date said order was filed in the office of the fiscal officer. If such
review is timely commenced, the money withheld shall remain in trust
pending final disposition of the review proceeding. In determining the
rate of interest to be imposed the fiscal officer shall consider the
size of the employer's business, the good faith of the employer, the
gravity of the violation, the history of previous violations of the
employer, successor or substantially-owned affiliated entity or any
successor of the contractor or subcontractor, any officer of the
contractor or subcontractor who knowingly participated in the violation
of this article, and any of the partners if the contractor or
subcontractor is a partnership or any of the five largest shareholders
of the contractor or subcontractor, as determined by the fiscal officer,
and the failure to comply with recordkeeping or other non-wage
requirements.

6. When a final determination has been made and such determination is
in favor of an employee, such employee may, in addition to any other
remedy provided by this article, institute an action in any court of
appropriate jurisdiction against the person or corporation found to have
violated this article, any substantially-owned affiliated entity or any
successor of the contractor or subcontractor, any officer of the
contractor or subcontractor who knowingly participated in the violation
of this article, and any of the partners if the contractor or
subcontractor is a partnership or any of the five largest shareholders
of the contractor or subcontractor, as determined by the fiscal officer,
for the recovery of the difference between the sum, if any, actually
paid to him by the aforesaid financial officer pursuant to said order
and the amount found to be due him as determined by said order. Such
action must be commenced within three years from the date of the filing
of said order, or if the said order is reviewed in a proceeding pursuant
to article seventy-eight of the civil practice law and rules, within
three years after the termination of such review proceeding.

Provided that no proceeding for judicial review as provided in this
section shall then be pending and the time for initiation of such
proceeding shall have expired, the fiscal officer may file with the
county clerk of the county where the employer resides or has a place of
business the order of the fiscal officer containing the amount found to
be due. The filing of such order shall have the full force and effect of
a judgment duly docketed in the office of such clerk. The order may be
enforced by and in the name of the fiscal officer in the same manner,
and with like effect, as that prescribed by the civil practice law and
rules for the enforcement of a money judgment.

7. When, pursuant to the provisions of this section, two final orders
have been entered against a contractor, subcontractor, successor, or any
substantially-owned affiliated entity of the contractor or
subcontractor, any of the partners if the contractor or subcontractor is
a partnership, any of the five largest shareholders of the contractor or
subcontractor, any officer of the contractor or subcontractor who
knowingly participated in the violation of this article within any
consecutive six-year period determining that such contractor or
subcontractor and/or its successor, substantially-owned affiliated
entity of the contractor or subcontractor, any of the partners or any of
the five largest shareholders of the contractor or subcontractor, any
officer of the contractor or subcontractor who knowingly participated in
the violation of this article has willfully failed to pay the prevailing
wages in accordance with the provisions of this article, whether such
failures were concurrent or consecutive and whether or not such final
determinations concerning separate public building service contracts are
rendered simultaneously, such contractor, subcontractor, successor, and
if the contractor, subcontractor, successor, or any substantially-owned
affiliated entity of the contractor or subcontractor, any of the
partners if the contractor or subcontractor is a partnership, or any of
the five largest shareholders of the contractor or subcontractor, any
officer of the contractor or subcontractor who knowingly participated in
the violation of this article, or any successor is a corporation, any
officer of such corporation who knowingly participated in such failure,
shall be ineligible to submit a bid on or be awarded any public building
service work for a period of five years from the date of the second
order, provided, however, that where any such final order involves the
falsification of payroll records or the kickback of wages, the
contractor, subcontractor, successor, substantially-owned affiliated
entity of the contractor or subcontractor, any partner if the contractor
or subcontractor is a partnership or any of the five largest
shareholders of the contractor or subcontractor, any officer of the
contractor or subcontractor who knowingly participated in the violation
of this article shall be ineligible to submit a bid on or be awarded any
public building service contract or subcontract with the state, any
municipal corporation or public body for a period of five years from the
date of the first final order. Nothing in this subdivision shall be
construed as affecting any provision of any other law or regulation
relating to the awarding of public contracts.

8. a. When a final determination has been made in favor of a
complainant and the contractor or subcontractor found violating this
article has failed to make payment as required by the order of the
fiscal officer, and provided that no relevant proceeding for judicial
review shall then be pending and the time for initiation of such
proceeding shall have expired, the fiscal officer may file a copy of the
order of the fiscal officer containing the amount found to be due with
the county clerk of the county of residence or place of business of any
of the following:

(i) any substantially-owned affiliated entity or any successor of the
contractor or subcontractor;

(ii) any of the partners if the contractor or subcontractor is a
partnership or any of the five largest shareholders of the contractor or
subcontractor, as determined by the fiscal officer; or

(iii) any officer of the contractor or subcontractor who knowingly
participated in the violation of this article; provided, however, that
the fiscal officer shall within five days of the filing of the order
provide notice thereof to the partner or top five shareholder or
successor or substantially-owned affiliated entity. The notified party
may contest the filing on the basis that it is not a partner or five
largest shareholders, an officer of the contractor or subcontractor who
knowingly participated in the violation of this article, successor or
substantially-owned affiliated entity. If, after reviewing the
information provided by the notified party in support of such contest,
the fiscal officer determines that the notified party is not within the
definitions described herein, the fiscal officer shall immediately
withdraw his filing of the order.

b. The filing of such order shall have the full force and effect of a
judgment duly docketed in the office of such clerk. The order may be
enforced by and in the name of the fiscal officer in the same manner,
and with like effect, as that prescribed by the civil practice law and
rules for the enforcement of a money judgment.

9. When a final determination has been made against a subcontractor in
favor of a complainant and the contractor has made payment to the
complainant of any wages and interest due the complainant and any civil
penalty, and providing that no relevant proceeding for judicial review
shall then be pending and the time for initiation of such proceeding
shall have expired, the contractor may file a copy of the order of the
fiscal officer containing the amount found to be due with the county
clerk of the county of residence or place of business of the
subcontractor. The filing of such order shall have the full force and
effect of a judgment duly docketed in the office of such clerk. The
judgment may be docketed in favor of the contractor who may proceed as a
judgment creditor against the subcontractor for the recovery of all
monies paid by the contractor under such order.