A Lakeville man was convicted this week of one count of felony wage theft, marking the first conviction of its kind under a 2019 state law.
Frederick Leon Newell, 59, was convicted by a Hennepin County district judge Wednesday of one count of wage theft and one count of theft by swindle, according to the Hennepin County Attorney’s Office.
“This wage-theft conviction is the first of its kind in Minnesota. It is an important step forward in our efforts to protect workers,” Hennepin County Attorney Mary Moriarty said. “This type of behavior will not be tolerated. Mr. Newell was entrusted with public funds to pay his staff for their labor on a public works project. Instead, he siphoned their money for himself.”
According to the criminal complaint, Newell committed wage theft by failing to pay employees at his company at the rate of pay required by law. Newell owned Integrated Painting Solutions in Apple Valley, according to the criminal complaint.
Newell’s company secured a bid to do work on the Redwell apartment complex at 1020 N. Third St. in Minneapolis. He hired seven people to paint and do cleaning. All that work was subject to wage requirements under city ordinance and state and federal law.
The court also found that Newell had committed “major economic offenses,” which may lead to a longer sentence.
In total, five employees of Newell’s company were underpaid by more than $37,000 between June 8, 2020, and Dec. 4, 2020.
Newell was charged with one count of theft of wages and one count of theft by swindle.
Authorities said the latter charge refers to Newell continuing to “accept payments from a general contractor over the course of a project despite knowing that his company was in financial distress, was not paying prevailing wage, and was concealing hours worked by employees.”
“This guilty verdict marks a historic milestone in our ongoing commitment to workplace justice,” said state Rep. Cedrick Frazier, DFL-New Hope, a member of the House Workforce, Labor, and Economic Development Committee. “When the Legislature amended Minnesota’s theft statute in 2019, we took a significant step by explicitly recognizing wage theft as a criminal offense. However, our work to protect hardworking Minnesotans isn’t complete.”
Frazier is looking at legislation to grant county attorneys authority to further investigate wage theft.
Newell will be sentenced June 6.
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