A New Jersey law designed to close a major loophole in construction wage theft is about to get its first real test.
The Laborers’ International Union of North America announced Tuesday it has filed what’s believed to be the first lawsuit brought by a labor union under New Jersey’s “up-the-chain” liability statute, a law that lets workers recover unpaid wages from general contractors and developers even when their direct employer can’t or won’t pay.
The suit was filed in Superior Court by LIUNA Local 3 and the Laborers’ Eastern Region Organizing Fund. It names general contractor AJD Construction and subcontractor Concrete Rising as sharing liability for wages never paid to workers on two major Jersey City developments: Kushner Companies’ One Journal Square and Namdar Group’s 35 Cottage Street.
Hugh Baran, a partner at Katz Banks Kumin who is representing the union, said the case tests not just the original law but a 2024 amendment that expanded who can enforce it.
“Today’s lawsuit is, to our knowledge, the first of its kind brought by a labor union under the Up-the-Chain Liability Statute, which was amended in early 2024 to allow unions to enforce its protections on behalf of construction workers — including for those not already part of a union,” Baran said. “Our firm is proud to represent Laborers Local 3 in this important case to hold AJD and Concrete Rising accountable for this wage theft.”
The numbers behind the case are steep.
According to findings by the N.J. Department of Labor and Workforce Development, more than 240 workers are owed more than $716,000 in unpaid wages — a figure that doesn’t include the liquidated damages, penalties and other remedies the lawsuit is also seeking, pushing the total sought above $2 million. The workers’ direct employer later declared bankruptcy, leaving them with no practical way to collect what they’d earned.
This seemingly is the scenario the up-the-chain law was written to address.
Mike Travostino, spokesperson for LIUNA Local 3, said the law only matters if it’s enforced.
“This case is about a simple principle: if you work, you deserve to be paid,” Travostino said. “New Jersey made a promise to construction workers when it enacted the up-the-chain liability law. Today, we are asking the courts to ensure that promise has real meaning. No worker should lose weeks or months of wages simply because a subcontractor disappears into the night while others in the contracting chain continue to profit.”
Mike Hellstrom, LIUNA’s vice president and Eastern regional manager, said the case is about accountability that reaches beyond any single job site.
“For too long, responsibility has been pushed down the contracting chain while accountability has been pushed away,” Hellstrom said. “This law changes that. Companies that benefit from construction projects should not be able to wash their hands when workers are left unpaid.”
“This case is about ensuring that New Jersey’s construction industry rewards responsible businesses while protecting the men and women whose labor makes every project possible. When workers know they will be paid fairly, responsible contractors can compete on a level playing field, and communities benefit from an industry built on integrity.”
Those named in the suit could not be reached for comment.
