Company president guilty of theft by swindle for not paying prevailing wage

Monday, March 07, 2016

Hennepin County District Court Judge Tamara Garcia found the co-owner of an electrical company guilty of 16 counts of theft for failing to pay workers the prevailing wage, Hennepin County Attorney Mike Freeman announced Monday.

Laura Plzak, 54, of Loretto, was convicted of 13 counts of theft by swindle over $35,000 and three counts of theft by swindle over $5,000. Judge Garcia ordered a pre-sentence investigation and set Plzak’s sentencing for May 13. Judge Garcia heard the case herself, based on a review of the evidence agreed to by both the prosecutor and the defense attorney, and announced her decision Monday morning.

“This is a good decision, based on the enormous amount of evidence gathered by the FBI and the Minnesota Department of Transportation and presented by our prosecutor to Judge Garcia,” Freeman said. “Ms. Plzak’s actions were driven by greed, pure and simple, and it was the hardworking electricians who suffered.”

According to the criminal complaint, Plzak is the president and chief executive officer of Honda Electric, a company she runs with her husband, Jeffrey, out of their Loretto home. Jeffrey Plzak is an electrician and worked at the job sites while Laura Plzak handled the office work.

In 2010, Honda was the electrical subcontractor on a Minnesota Department of Transportation project at Interstate 35W and Interstate 694. In October 2010, the transportation department started investigating Honda and two months later a former Honda employee, M.J., told investigators he was paid $17 an hour, rather than the $58.50 an hour he was supposed to get under the prevailing wage law, according to the criminal complaint.
When M.J. talked to investigators, he provided them with both timesheets and paystubs from some of the pay periods of Aug. 24, 2010 to Oct. 6, 2010. The paystubs showed a lower number of hours worked than what M.J. had reported on his timesheets and therefore a higher rate of pay, the complaint states.
In her findings of fact and guilt against Plzak, Judge Garcia wrote that Plzak submitted bids for government work promising to pay the higher prevailing wage but “without any intention of fulfilling those promises.” Further, Plzak admitted she falsified government forms to make it appear that the workers were receiving prevailing wage, Judge Garcia wrote in her order. As a result,Plzak’s company wrongfully obtained $1.5 million in public contract funds and  22 employees were shortchanged $242,000 for their work from 2010 through 2012.
The work Honda Electric did, besides several road projects, included projects at the Bois Forte Reservation in northern Minnesota, the University of Minnesota and the Three Rivers Park District.

Jeffrey Plzak pleaded guilty to similar charges in U.S. District Court last year and was sentenced to 22 months in prison.