SAN JOSE – The owner of a Bay Area construction company faces nine months in jail for firing workers after they requested medical treatment for work-related injuries, prosecutors said.
Man Tat Szeto, the proprietor of MT Szeto Construction, pleaded guilty to workers compensation insurance fraud, unemployment insurance tax fraud and money laundering, the Santa Clara County District Attorney’s Office said in a statement Wednesday.
Between 2016 and 2019, the 71-year-old San Ramon resident avoided $86,000 in premium payments to his insurer by underreporting employees and injuries, said prosecutors, adding that he also used the banking system to launder $165,000 to pay workers off the books.
In late 2018, former employees reported they had been terminated after requesting medical treatment for work-related injuries. Prosecutors said Szeto gave the workers cash and fired them instead of filing appropriate insurance claims and risking a hike in premiums.
Employees also frequently worked 70 hours a week but were only paid for 40, prosecutors said.
Suspicious activity at a new residential construction project in San Jose resulted in the California Contractors State License Board bringing the case to the attention of the district attorney’s office.
In addition to jail time, Szeto’s plea agreement calls for him to serve five years formal probation and pay $250,000 in restitution.
“When unscrupulous employers refuse to pay fair hourly wages, cheat on taxes and cover up workplace injuries, they exploit vulnerable individuals as well as our community which must bear the cost of illegality,” said Deputy District Attorney Mattia Corsiglia in a statement.