Another Minnesota trucking company has come under federal and state investigation for allegedly shorting its drivers' payroll checks and submitting fraudulent payroll records to the government.
Authorities have searched the St. Cloud offices of Watab Hauling and the home of its owner, Gary Bauerly, 60, Rice, Minn., seeking evidence of mail fraud and false statements in connection with several highway projects, according to federal court records unsealed Friday in Minneapolis.
According to a sworn statement by Chris R. Smith, a special agent with the U.S. Department of Transportation's inspector general's office in Chicago, Watab Hauling has worked on at least a dozen federally funded road projects for the Minnesota Department of Transportation (MnDOT) since 2005. Contractors paid with federal dollars must pay their workers what's called prevailing wages. Time-and-a-half pay is required for those who work more than 40 hours a week.
Smith said that Watab employees have reported to him and to investigators with the Minnesota Department of Transportation that they were not paid prevailing wages.
One employee reported that Bauerly called about 50 drivers to a meeting last year and put the prevailing wage checks from a recent project on the table. About 30 of the drivers worked on the project, and Bauerly allegedly told them to sign their checks back over to him, Smith said in his affidavit.
"In another meeting last year, Bauerly told the drivers they needed to sign a form stating they forfeit the prevailing wage," he said. "Bauerly told them if they did not sign over their prevailing wage checks, he would not call the drivers that did not sign the form as often to work."
Bauerly could not be reached for comment Monday. An employee at Watab Hauling took a message but said Bauerly would not be returning the call.
Smith declined to comment Monday. His affidavit said investigators have analyzed Watab Hauling's records and found falsifications of certified payrolls, including underreported hours, underpayment of wages and nonpayment of overtime.