Tough lesson learnt by Skanska

Friday 01 Apr 2011

Skanska 'regrets' evading government legislation on employment of disadvantaged, minority and woman-owned enterprises

A major construction and project development firm, Skanska has been ordered to pay the sum of $19.6m by the U.S Attorney’s Office for the Southern District of New York following allegations that the company’s USA Civil Northeast branch failed to comply with employment legislation regarding the use of disadvantaged, minority and female-owned business enterprises. A statement from Skanska notes that: “This amount was already provided for in the fourth quarter of 2010 in Skanska USA Civil and the settlement is not expected to generate any further costs.”

The focus of the investigation rested on a subcontractor who worked with Skanska, Environmental Energy Associates (EEA) which was allegedly hired to complete demolition, air testing and hazardous-gas monitoring amongst other things, but hired no workers or completed any of the agreed tasks. EEA was paid millions of dollars for the work which was actually carried out by the general contractor or third-part companies.

President of Skanska USA Civil, Richard Cavallaro has since issued a statement of regret explaining: “Skanska takes pride in its industry leadership in the area of diversity and we recognise, and regret, that we did not follow best practices with respect to our use of EEA as a disadvantaged, minority and female-owned business on certain projects. We’ve learned a tough lesson and we urge others in the industry to learn from it.”

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