1 Pacific Constructors has a contract for the construction of an office building for a state government agency. The contract specifies that prevailing wage rates must be paid to all workers employed on the project site and lists the minimum wage rates to be paid to each trade classification. As required by their subcontracts, all subcontractors are required to submit payroll reports to Pacific each month. The reports are combined with a payroll report for Pacific’s workers, and the entire report is submitted to the project owner.

Pacific’s project engineer reviewed the payroll reports submitted by the mechanical and electrical subcontractors. He observed that several journeyman electricians and plumbers were listed as helpers, and thus paid lower wage rates than journeymen would have earned. Rather than have a conflict with the two subcontractors, the project engineer decided to forward their payroll reports as submitted.

• Were the actions of the project engineer ethical?

• How would you have handled the situation?