State College-based Glenn O. Hawbaker Inc., a major Pennsylvania heavy equipment contractor, is agreeing to pay restitution of more than $20 million over allegations it illegally diverted retirement money and other benefits from its workers.
The company pleaded no contest to four counts of theft at the Centre County Courthouse on Tuesday. It's also agreeing to have a court-appointed corporate monitor perform oversight.
In April, Attorney General Josh Shapiro accused the company of stealing state money that was meant for workers.
Between 2003 and 2018, the company received $1.7 billion dollars to work on roads, bridges and other projects. But all the while, it was lying to state officials about some of its healthcare costs and was pocketing money meant for retirement accounts, leaving workers with way less than they were owed, according to Shapiro.
"So the men and women doing the backbreaking work on Pennsylvania roadways had their retirements stolen from them by the C-Suite executives who were sitting in their cozy offices on those hot summer days,” Shapiro said.
State prosecutors say the company’s illegal actions affected 1,267 current and former workers.
The statute of limitations ran out on most of the scheme, but Hawbaker agreed to pay back more than $20 million it stole from workers as early as in 2015. It'll have four months to pay it all back.
In a statement, Hawbaker said the practices it got in trouble for were "based upon the advice of former attorneys." The company said it's glad to have the matter concluded but maintained it followed all fringe benefits rules.
