A contractor will have to pay $364,000 for cheating workers out of wages under a settlement reached with City Controller Scott Stringer.
“The company will have to pay back $327,000 in unpaid wages and benefits to the workers, plus $20,000 in interest and $17,000 in civil penalties.”
So the actual penalty is only $17,000.
What was the rate that the offender paid for that $364,000 loan?
Assume that the average amount of withheld wages over the 5-year period was 1/2 of $327,000:
1/2 x $327,000 = $163,500
Total cost to company:
$20,000 interest + $17,000 civil penalties = $37,000
Convert to a percentage of the “loan”
$37,000 / $163,500 = 22.6%
Per year, the interest is approximately:
22.6% / 5 years = 4.5%
Yup. Thanks to Scott Stringer, Beacon Restoration, Inc., got a construction loan for only 4.5%. Amazing.
Source: EXCLUSIVE: NYC contractor cheated workers, owes $364G in back pay – NY Daily News