Posts Tagged ‘Department of Labor’
Thursday, March 24th, 2016
You’ve probably watched one before.
An anti-union video so painfully corny, you probably had to turn it off after a few seconds.
Anti-union videos—like this one from Target—fliers and other materials are the bread and butter of consulting firms who specialize in “union avoidance.” A nefarious industry that steps in for employers and attempts to squelch working people’s right to a union voice on the job.
Making these union busters more transparent is only fair. While unions are required to file lengthy annual LM-2 financial disclosure reports that detail all receipts and expenditures, the LM-20 form that management consultants will be required to file is two pages, much of which simply requires checking boxes.
Mike Lo Vuolo, a former American Airlines passenger agent, and his co-workers tried three times to form a union at American Airlines with the Communications Workers of America (CWA), under the company’s previous management. In 2012, despite having filed for bankruptcy, American Airlines spent hundreds of thousands of dollars on the law firm Sheppard Mullin. Mike recalls high-gloss fliers, video cassettes and DVDs used to discourage and scare employees during organizing drives.
AFL-CIO President Richard Trumka weighed in on the new rule:
It takes great courage for working people to come together to form a union. Working men and women deserve to know who their employer is hiring and exactly how much they are spending to discourage workers from forming a union.
This blog originally appeared at aflcio.org on March 23, 2016. Reprinted with permission.
Jackie Tortora is the blog editor and social media manager at AFL-CIO.
Thursday, January 21st, 2016
Businesses don’t just use temp staffing agencies to add workers for short periods when they need extra hands. Staffing agencies can also serve the valuable (to crappy employers) purpose of dodging responsibility. “That person may work in our business on our terms, but the staffing agency is their employer, so we’re not responsible for violating labor laws to exploit them,” is how the dodge basically goes. Now, the Department of Labor is taking steps against that, issuing guidelines on when the company using the staffing agency to hire temp workers should be considered a joint employer that’s responsible for the people working in its facilities.
“I think the majority of noncompliance that we see is people just not getting what the law is, and what their responsibilities are under it,” [Department of Labor Wage and Hour Division director David] Weil said in an interview. “We also find cases of people who are clearly playing games, and clearly trying to shift out responsibility, and often have structured things in a way that lead towards more noncompliance.”
Weil’s division has stepped up its proactive enforcement of situations where companies are functionally controlling the workers they order up from labor providers — and broadcasts its enforcement of egregious violations. Back in October, for example, investigators found that temp workers at a snack food producer in New Jersey were cheated out of overtime wages, and ordered the company to pay back wages, damages, and civil penalties.
That’s the most typical form of joint employment — a “vertical” arrangement, with one company hiring another, as the guidance describes. But joint employment can also be “horizontal,” when a worker might employed by two subsidiaries of the same company, but they never get overtime because their hours are tracked separately.
Business groups and congressional Republicans are predictably pissed that the Obama administration would have the nerve to suggest that employers follow the law, with House Republicans pointing out that the Department of Labor talked to the National Labor Relations Board, which is also cracking down on joint employer issues.
Low-road businesses have found a lot of ways around laws protecting workers, from these joint employer dodges to misclassifying workers as independent contractors to deny them minimum wage and overtime protections, unemployment insurance, and more. And every time the Obama administration cracks down, it’s a reminder of what’s at stake this November. The next president won’t just argue with Congress or even appoint Supreme Court justices. The next president will make the appointments that determine whether the Department of Labor is trying to make sure workers get paid for the hours they work or is looking for ways to let bad bosses off the hook.
This blog originally appeared in dailykos.com on January 20, 2016. Reprinted with permission.
Laura Clawson has been a Daily Kos contributing editor since December 2006 and Labor editor since 2011.
Tuesday, September 1st, 2015
Recently, the Department of Labor proposed a rule to bring overtime up-to-date. If the proposal goes into effect, an additional 5 million white-collar workers are expected to benefit from overtime. The Department of Labor wants to hear your voice on this proposal and until this Friday, September 4, 2015, they are taking comments on the proposed rule.
Whether a worker receives overtime or not is determined by a three-part test. Under this test, the employee does not receive overtime when:
- they are paid a fixed salary;
- their salary is at least $455 a week (which equates to $23,660 a year); and
- their job primarily involves executive, administrative, or professional duties.
Furthermore, there are exemptions for highly compensated employees who regularly perform executive, administrative, or professional duties and make at least $100,000 a year, including at least $455 a week via salary or fees.
The Department of Labor’s proposal would focus on the salary aspect of the three-part test. Instead of a stagnant number, the salary standard would be set at the 40th percentile of weekly earnings for full-time salaried workers, which is expected to be about $970 a week, $50,440 a year, in 2016. For highly compensated employees, the standard would be set at the 90th percentile, expected to be $122,148 annually.
This proposal would be a drastic change, but a necessary one. The salary threshold has only been updated twice in the last 40 years. As a result, only 8% of full-time salaried workers fall under the threshold. This is a stark contrast from 1975 when 62% of full-time salaried workers fell below the threshold. Under the Department of Labor’s proposal, of the five million new workers expected to qualify for overtime, 53% of them would have college degrees and 56% would be women.
These days, the few that do fall under the salary threshold for overtime likely fall under another threshold, the poverty line. The poverty line for a family of four is $24,008 a year, or $348 more than the overtime threshold. This means that, a worker making $460 a week could work 50 hours every week, receive no overtime pay, and be below the poverty line.
The Department of Labor’s proposal can still change and they want to hear from you on a wide variety of issues. The agency wants your opinion on the proposal to use the 40th and 90th percentiles, or switch to using changes in inflation to determine the salary threshold. They want to know whether the three-part test is working. First and foremost, they want to know what overtime pay would mean to you and your family.
Make your voice heard and make it clear that this is an important issue that has been ignored for far too long. Share your ideas on the proposal here and your story here. You only have until Friday, but please, don’t make the comments too long they would have to work overtime to read them all, and chances are they don’t get paid for that.
About the Author: The author’s name is Erik Idoni. Erik Idoni is a student at the George Mason University School of Law and an intern at Workplace Fairness.
Monday, July 27th, 2015
Are you an employee?
It seems like a simple question that must have a simple answer for most people. But definitions in different laws and rulings enforcing the laws vary. And that variation provides an opening for a growing number of employers to cheat governments of taxes and workers of income, benefits and protections by misclassifying their employees, especially as “independent contractors.”
Last week, the administrator of the Department of Labor’s Wage and Hour Division, David Weil, released a “letter of guidance” that clarifies who is an employee and who is an “independent contractor”—that is, essentially an individual running his or her own business. He argues that the most definitive statement from Congress comes from the Fair Labor Standards Act, which says that “to employ” means “to suffer or permit to work.” And, he concludes, “under the Act, most workers are employees.”
The decision is “incredibly important,” says Catherine Ruckelshaus, general counsel and program director of the National Employment Law Project (NELP), a pro-worker nonprofit organization, and may help to clear up confusion in the courts and encourage more enforcement of the law.
In recent years, many companies—from 10 percent to 30 percent or more of employers—employ at least several million people who are misclassified as independent contractors, according to a recent NELP report. They even go so far as to require workers to form a limited liability corporation or franchise (with themselves as the one and only participant) or to sign contracts declaring that they are independent contractors. According to another study from economist Jeffrey Eisenach of George Mason University, the number of independent contractors rose by one million from 2005 to 2010, including both fake and real contractors (often unemployed workers who re-label themselves as “consultants”).
One high-profile example is the Federal Express delivery driver—who wears a FedEx uniform, drives a company truck, follows a route set by the company and still is treated as a contractor. Weil’s ruling may also tip the judgment against companies like the Uber taxi service, increasingly targeted in lawsuits as improperly treating its drivers as independent contractors.
When employers misclassify workers, they often pay less for contractors, but most important, the workers lose a wide range of protections and benefits under the law such as unemployment compensation, workers’ compensation, minimum wage and overtime regulations, and governments lose billions of dollars a year in taxes that support those programs.
In his recent book The Fissured Workplace, Weil argues that workplace phenomena like subcontracting, using independent contractors, franchising and other ways to make employers less responsible for their employees is not just a result of competition driving down costs, whether as a result of globalization, weakening of unions, new technologies or new work processes, but also “pressure from public and private capital markets to improve returns.”
Unlike the “common law” test for who is an employer, which emphasizes the degree of control over one’s work, the FLSA standard usually relies on an “economic realities” test, which examines many different dimensions of work without favoring one above all others. But in his guidance letter, Weil writes, “the ultimate inquiry under the FLSA is whether the worker is economically dependent on the employer or truly in business for him or herself.” But the varied economic realities tested include such questions as how integral the worker is to the business, how much does managerial skill affect possible profit or loss, how big is the worker’s relative investment, does the worker’s success rely on special business skills in addition to any technical skills, what kind of control does the employer exercise, or how permanent is the relation of the worker to the employer.
The impact of this guidance letter may first be felt in courtrooms and in various federal or state agencies, but Ruckelshaus hopes that employers will voluntarily take it seriously. More likely, it will only be quite meaningful if there are systematic state and federal efforts to audit employer behavior, especially in industries where abuses are common, such as lower-skill construction, home care and janitorial work. Unions are also in a position to push for more vigorous enforcement, as Ruckelshaus said the Carpenters have been.
And when it is clear that the workers are not contractors but employees, the unions can do the workers a favor and invite them to join the union.
This blog was originally posted on In These Times on July 22, 2015. Reprinted with permission.
About the Author: The author’s name is David Moberg. David Moberg, a senior editor of In These Times, has been on the staff of the magazine since it began publishing in 1976. Before joining In These Times, he completed his work for a Ph.D. in anthropology at the University of Chicago and worked for Newsweek. He has received fellowships from the John D. and Catherine T. MacArthur Foundation and the Nation Institute for research on the new global economy. He can be reached at firstname.lastname@example.org.
Sunday, November 2nd, 2014
“This is worse than anything I ever saw in any of those Los Angeles sweatshops,” said Michael Eastwood, a Los Angeles Department of Labor assistant district director, reflecting on a Silicon Valley firm’s failure to pay minimum wage to eight Indian employees.
The workers, who were flown in from the company’s Bangalore offices, worked up to 122 hours a week helping Electronics for Imaging, Inc. (EFI) move its headquarters from Foster City to Fremont, CA. They were granted no overtime for their work, and were paid the equivalent of $1.21 an hour—well below California’s $8 per hour minimum wage. While working in the U.S., they continued to be paid in rupees.
An anonymous tip led the Department of Labor to investigate. The result: EFI will pay more than $40,000 in back pay to the workers, as well as a $3,500 fine.
While not one of Silicon Valley’s high-profile giants, Electronics for Imaging certainly has the cash to pay everyone a fair wage. They brought in $728 million in revenue last year and offered their CEO, Guy Gecht, a pay package valued at around $6 million.
Beverly Rubin, EFI’s vice president of HR shared services, provided the following statement to CNBC:
“To help our local IT team with a complex move of our Bay Area facility and data center, we brought a few of our IT employees from India for a short assignment in the US. … During this assignment they continued to be paid their regular pay in India, as well as a special bonus for their efforts on this project. During this process we unintentionally overlooked laws that require even foreign employees to be paid based on local US standards. When this was brought to our attention, we cooperated fully with the Department of Labor, and did not hesitate to correct our mistake and to make our Indian colleagues whole based on US laws, including for all overtime worked. We have also taken steps to ensure that this type of administrative error does not reoccur.”
In other words, they didn’t realize that foreign employees had to be paid the minimum wage of the country in which they were temporarily working — a poor excuse that neither qualifies as an apology nor indicates that EFI has any intention to stop exploiting its outsourced labor.
Given the incredibly under-resourced government agencies tasked with monitoring employers who violate labor law, the likelihood that companies will be caught is fairly low. And even if they are caught, companies like EFI are only risking miniscule fines—in the case of these Indian workers, less than $500 per worker.
So why wouldn’t companies take a gamble on paying workers so far below the minimum wage?
The EFI story seems to be representative rather than exceptional. While profits for domestic tech workers continue to skyrocket (with the exception, of course, of those workers involved in the tech-service industry), the laborers that tech hires abroad are seeing neither the pay nor the cushy work environments that distinguish their U.S. counterparts.
Adrian Chen reported for WIRED last week on the content moderation industry, an invisible workforce of up to 100,000 that operates primarily in Southeast Asia. These workers are responsible for sifting through the Internet’s ugliest corners to ensure social media users don’t come across graphic content. They spend their days examining videos and images of everything from beheadings to bestiality.
“It’s like PTSD,” one of the workers told Chen. “How would you feel watching pornography for eight hours a day, every day? How long can you take that?”
This blog originally appeared on Inthesetimes.com on October 30, 2014. Reprinted with permission. http://inthesetimes.com/working/entry/17302/silicon_valley_wage_theft_worse_than_sweatshops.
About the author: Alex Lubben is the Deputy published of InTheseTimes.
Monday, February 17th, 2014
Each year, tens of thousands of immigrant “guestworkers” come to the United States on special employer-sponsored visas to work temporary jobs in landscaping, hotel housekeeping and other low-wage sectors. But for decades, these workers have beendemonized and scapegoated, accused of hurting “native” U.S. workers by driving down wages. At the same time, the immigrants themselves have spoken out about their poor wages and working conditions, and have even gone on strike and organized independent labor movements to demand the same rights and wages as that of their American counterparts. It seems the only people who like this system, in fact, are the bosses who rely on a surplus army of imported temporary labor, denied the labor protections and legal rights of citizens.
In 2011, the Department of Labor (DOL) issued major reforms to a flagship guestworker program known as H-2B, which funnels tens of thousands of migrants annually into low-wage jobs in workplaces from Florida hotel chains to crabmeat canneries. Business groups, predictably, sued to block the regulations—but last week, an appeals court finally put their arguments to rest.
The reforms, which the DOL based upon an assessment of wage rates and labor market conditions for U.S. workers, mandate pay high enough to maintain prevailing wages in sectors that recruit guestworkers, and thus sustain current working conditions. The wage rules are part of a package of guestworker program reforms proposed by the DOL, that has long been stalled by Congress and court challenges but, with this court victory, can finally be implemented.
In Louisiana Forestry Association v. Secretary, U.S. Department of Labor, business associations representing the forestry, seafood processing and hotel industries, among others, argued that the Labor Department lacked the legal authority to imposethe reforms and was impinging upon employers’ control over wages.
However, Meredith Stewart, an attorney with the Southern Poverty Law Center (SPLC), which represented the workers’ groups that joined the Labor Department in fighting the suit in court, points out that employers supported the previous, laxer regulations that made it easy to pay substandard wages. “It really wasn’t until the Department of Labor issued a wage rule that would lead to substantial increases for workers that employers decided to challenge their authority to issue any regulations for the program,” she tells Working In These Times. The new rules, she says, simply mandate that “to the extent that employers are going to employ foreign workers, those foreign workers and U.S. workers need to be treated equally and fairly.”
In court, the Labor Department and workers’ advocates cited the agency’s legal mandate, which explicitly directs regulators to protect workers from wage suppression and displacement by unscrupulous bosses. On February 4, the Third Circuit Appeals Court unanimously agreed that the Labor Department had the authority to make the reforms, rejecting the employers’ arguments.
While the pending regulations would hardly be a comprehensive overhaul, they strengthen the meager existing H-2Bprotections by barring employers from paying H-2B workers so little as to undercut existing wage levels for non-visa workers who do “substantially the same work.” Essentially, the prevailing wage standard, set according to the Labor Department’s economic assessments, aims to preserve working conditions in a given sector by preventing employers from manipulating immigrants to cheapen labor costs. It also would block employers from unfairly cutting hours and from deducting transportation or equipment costs from workers’ pay. Employers would be required to disclose more information up front in the recruitment and hiring process, about job requirements and workers’ legal rights. The regulations also help shield workers from discrimination if they complain about mistreatment—a critical protection because they depend on their employer’s sponsorship for their U.S. visa authorization and are thus easily coerced into silence.
Most controversy over guestworkers stems from the popular misconception that immigrants are to blame for supposedly “stealing” jobs. In fact, migrants often work jobs that complement, rather than displace, the employment of U.S. workers. But even in the labor markets where the importation of guestworkers has resulted in declining labor conditions, the process isdriven primarily by the labor abuses and rampant exploitation of employers—thus all workers, native and immigrant, documented and undocumented, have an interest in equalizing labor rights across the board, to resist attempts by corporations to divide and exploit the workforce with impunity. To that end, the grassroots labor organizing among guestworkers highlights a shared labor struggle in a system that robs U.S. and immigrant workers alike of dignity. Several labor scandals, such as the recent case of seafood processing workers in the massive supply chain of Wal-Mart, have shed light on the common practice of underpaying H-2B immigrants. In a 2012 report by the National Guestworker Alliance (NGA) on abuses in guestworker programs, NGA co-founder Daniel Castellanos-Contreras recalled his experience of exploitation as an H-2B worker in the aftermath of Hurricane Katrina, lured to the U.S. from his native Peru on the promise of a decent hotel-industry job.
Instead of hiring [local] workers from the displaced and jobless African American community, he sent recruiters to hire us. At around $6.00 an hour, we were cheaper. As temporary workers, we were more exploitable. We were hostage to the debt in our home countries; we were terrified of deportation…
The report details various forms of mistreatment that guestworkers like Castellanos-Contreras have suffered, such as wage theft and labor trafficking. In an email to Working In These Times, Castellanos-Contreras says of the Third Circuit Court ruling, “The court has caught up with what thousands of guestworkers have been saying since Hurricane Katrina: to stop exploitation in guestworker programs, we need higher prevailing wages, and we need protections from employer retaliation to make sure that the rules of the program are enforced.”
The H-2B reforms still face legal roadblocks, however. Another, related set of H-2B rule changes has been held up by a preliminary injunction issued by a Florida court in a separate suit, brought by Bayou Lawn & Landscape Services, which might potentially lead to a conflicting ruling by the 11th Circuit Court of Appeals—one more hurdle that has so far impeded full implementation. Outside the courts, conservative lawmakers stalled the implementation of the wage rules in 2012 by voting to block the required funding for the Labor Department to carry out the regulations. (The block was lifted in the 2014 budget legislation, which should clear the way for the new standards, according to the SPLC.) Meanwhile, tepid attempts in Congress to pass more comprehensive overhauls of both guestworker programs and the entire immigration system have foundered amid political gridlock.
Stewart says that, despite the incremental legal victories, “There’s still a long way to go to making these programs even remotely functional, from a worker advocates’ standpoint.”
On top of their demand for stronger wage standards, the fight will continue for more safeguards against abuses like fraud in the labor recruitment process, as well as protections for their right to organize. And progressive advocates for immigrant laborers ultimately want to move away from the precarious temporary labor of the current visa system–and toward an equitable immigration policy that provides genuinely equal employment opportunities and the ability to gain full citizenship. For now, though, the court’s affirmation of their basic right to fair pay marks a modest milestone in the migrants’ long journey.
This article was originally printed on Working In These Times on February 13, 2014. Reprinted with permission.
About the Author: Michelle Chen is a contributing editor at In These Times, a contributor to Working In These Times, and an editor at CultureStrike. She is also a co-producer of Asia Pacific Forum on Pacifica’s WBAI. Her work has appeared on Alternet, Colorlines.com, Ms., and The Nation, Newsday, and her old zine, cain.
Tuesday, December 10th, 2013
To commemorate its 100th anniversary, the U.S. Department of Labor has launched “Books that Shaped Work in America (www.dol.gov/books), an online project which explores work, workers and workplaces through literature, and aims to educates the public about the history, mission and resources of their Labor Department.
People from all walks of life are being asked to recommend books that informed them about occupations and careers, and molded their views about work.
What book would you list that shaped work in the nation? What title from which iconic author to choose? Fiction or nonfiction: which plays a bigger role? Whose life—in biography or autobiography—exemplifies the axiom that hard work is the best path to achieving the American Dream? Plays and poetry count, too.
Already on the list: Death of a Salesman, What Color is Your Parachute?, Working, Economics in One Lesson, To Kill a Mockingbird, The Grapes of Wrath, The Feminine Mystique, Anthem, and On the Waterfront, among others. U.S. Labor Secretary Thomas E. Perez, contributed suggestions for the list, as did George P. Shultz and seven other former labor secretaries from both sides of the aisle. Other notables that contributed to the list include authors Daniel H. Pink and Joan Acocella, Solicitor of Labor M. Patricia Smith, Liz Claman of Fox Business News, President of the National Urban League Marc Morial and Scott McGee of Turner Classic Movies. Their recommendations are included on the initiative’s website, along with brief summaries of each book and links to related U.S. Department of Labor resources.
To learn more, or to suggest a book to add to the list, visit: www.dol.gov/books.
About the Author: Carl Fillichio serves as senior advisor for public affairs and communications at the U.S. Department of Labor. He oversees the department’s media and public relations efforts, internal communications, social and digital media, audio visual production, graphic design, editorial services, web development and the DOL National Contact Center. He also serves as the chair of the department’s centennial and the U.S. Labor Hall of Honor.
Prior to coming to the Labor Department Fillichio was a senior vice president at Lehman Brothers, the global investment bank, where he promoted the firm’s thought leadership in talent management, diversity recruitment, and philanthropic initiatives.
Previously, he served for seven years as the Vice President for Public Engagement at the Council for Excellence in Government, a national non-partisan think tank that worked to improve government performance and citizen participation, understanding and trust in government. In this role Fillichio convened thought leaders, Members of Congress, journalists, and community members to examine a wide range of public policy issues. Working alongside the newly formed Department of Homeland Security, he led a national initiative to capture public perceptions of safety and emergency preparedness. He also directed the Council’s efforts on attracting the best and brightest to public service and served as program committee chair of the annual Excellence in Government Conference. For his work, he was named in 2004 to Utne Magazine’s list of the “Radical Middle: 10 Americans Reshaping the Future of American Politics.”
In 2013 he was named “Communicator of the Year” by the National Association of Government Communicators.
This is not Fillichio’s first “tour of service” at the US Department of Labor: He was Deputy Assistant Secretary for Public Affairs during the Clinton Administration. He grew up in Chicago, Illinois and Boca Raton, Florida and is a graduate of the John Carroll University in Cleveland, Ohio.
Tuesday, October 1st, 2013
In case you haven’t heard, as of 12:01 a.m. this morning, the federal government is closed. Your business will feel this shutdown in many ways, including in your interactions with the federal agencies that enforce the various labor and employment laws. Each has posted on its website a contingency plan for operations during the shutdown.
For example, the Equal Employment Opportunity Commission:
- Will accept and docket new charges, and examine if immediate injunctive relief is necessary.
- Will not conduct any investigations.
- Will not mediate any charges.
- Will not have staff available to answer questions or respond to correspondence.
- Will not litigate, unless a court denies a request for extension of time.
- Will not process any FOIA requests.
The Department of Labor and the National Labor Relations Board have each posted their own detailed shutdown plans. The bottom line, however, is that except for services that are absolutely essential, federal agencies will be closed until Congress works out its financial issues.
Federal courts, meanwhile, will remain open for business as usual for at least 10 business days, after which the Judiciary will reassess the situation.
Other federal services impacting employers that will be temporarily shuttered include e-Verify and the IRS.
While it difficult to predict how long this shutdown will last.The last shutdown of the federal government, spanning the end of 1995 to the beginning of 1996, lasted 28 days.
For now, if you have active matters with any federal agencies, expect for them to be on hold. Please remember is that while the EEOC and other agencies might be temporarily out of business, the laws that they enforce are not.
This article was originally printed on Ohio Employer’s Law Blog on October 1, 2013. Reprinted with permission.
About the Author: Jonathan Hyman is a partner in the Labor & Employment group of Kohrman Jackson & Krantz.
Monday, January 28th, 2013
If you asked me about the most significant issue in workplace fairness today, I wouldn’t cite any of the common answers. Although there are widespread issues such as corporate bullying, the wage gap between men and women, and a general lack of freedom among employees, there is one problem that is more widespread and more egregious than anything else. There is no aspect of the modern American workforce which is as unfair as the unpaid internship.
The Ethics of Payment
Work for pay is part of the social contract of modern life in a capitalist society. We all adhere to the same agreement: if you offer people a chance to contribute in a way that is valuable and if you define requirements around that work, they deserve to receive fair compensation for their efforts.
Our organizations really are that simple: if there’s defined work to be done, you get paid for that work. If you’re not receiving some kind of payment—such as volunteering—then there is no expectation that you will work at a particular time or place, or that the work will be completed according to certain parameters. Work equals wages. That’s the only way to make things fair.
The Apprenticeship and the Internship
Compensation doesn’t always mean cash. Sometimes, we pay people in-kind. We feed them. We provide housing stipends. We offer them credit or teach them something of value. In Europe, these programs are called apprenticeships. Individuals spend years working with a master craftsman to learn the trade. They often sign agreements to work for the employer full-time after their training is complete. And overseas, apprentices are paid for their efforts.
But the internship has become something different. For many, this is not a job training program. Instead of working on actual projects of value to the company, interns fetch lunches and clean closets. They make coffee and photocopy documents. They perform concierge work such as picking up dry-cleaning or delivering packages. Many interns aren’t doing much work related to the business. These internships are not apprenticeships.
Furthermore, perhaps one-half of all internships are unpaid. That means all of that grunt work is done simply for the chance to be near the people in the industry.
Requiring individuals to perform work—but refusing to pay them for their work—is wrong.
Unpaid Internships: Often Illegal
In the United States, unpaid internships are often (if not usually) illegal. The Department of Labor defines six criteria for interns that do not receive cash compensation:
- The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;
- The internship experience is for the benefit of the intern;
- The intern does not displace regular employees, but works under close supervision of existing staff;
- The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded;
- The intern is not necessarily entitled to a job at the conclusion of the internship; and
- The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.
It’s extremely difficult to design an internship experience that meets all six of these requirements. Consider the first item. Most workplaces are nothing like schools. Do interns attend classroom-style instructional sessions? Do they have assignments which are graded? Do they receive individualized feedback? Do they study academic curriculum and report on their newfound knowledge and perspective?
Furthermore, the fourth point is nearly impossible to meet. For an internship to comply with this statement, the intern cannot conduct effort that the employer can consider valuable. That means an intern cannot produce a work product that will be purchased by a customer. They cannot write articles for the company newsletter or the blog. They are prohibited from substantial contributions in sales presentations or marketing efforts.
Ultimately: any work that an unpaid intern completes must be graded and then discarded. If you put an intern’s efforts to use in promoting your company, creating your products, or delivering your services—then that intern must be paid.
Hampering the Economy
The unpaid intern is not only an issue of workplace fairness, but also has a tremendous impact on our economy. When people perform work for free, they limit the growth of business by devaluing productivity. The more interns complete unpaid work—and the more that employers recruit unpaid interns—the less true economic activity is possible.
In simple terms: if people are working for free, why invest money in paying for work?
Therefore, the right thing to do for the country as well as for the people in your lives is to pay your interns. And if you can’t afford to pay them, that probably means you don’t have the resources to treat them like students and invest in their education.
Do the right thing. Pay your interns. Or, send them somewhere that they can earn a living wage.
About the Author: Robby Slaughter is with a business consulting firm based in the Midwest. He is the author of several books and hundreds of published articles.
Monday, March 14th, 2011
Advocates estimate that tens of billions dollars are stolen from workers every year through wage theft. A national survey of workers in the United States’ three largest cities – New York, Chicago, and Los Angeles – showed the startling finding that 26 percent of those surveyed in low-wage industries were paid less than the minimum wage in the last year and 75 percent were not paid overtime. The survey showed that 15 percent of the earnings of low-wage workers were stolen each year.
Part of the problem is that often workers don’t have the ability to prove that their wages were stolen. Pay stubs do not have uniform standards that clearly indicate overtime, wage per hour, exact days, and hours worked. Ten states do not even require employers to provide pay stubs for workers. The uneven standards and lack of uniformity and clarity in standards makes it very difficult for workers to prove that wages are stolen.
It would cost employers almost nothing to provide workers with such information. Already, employers are required to keep this information and give it to the IRS, state tax authorities, and the U.S. Department of Labor (DOL), just not to the workers. So it’s not as if companies do not already collect this information—they simply don’t want to give it to workers. Earlier this year, the Department of Labor (DOL) issued a statement indicating it intended to make a rule making greater standards and transparency. The Department announced that
Wage and Hour Division [of the Department] intends to publish a proposed rule updating the recordkeeping regulation issued under the Fair Labor Standards Act (FLSA) to assist employers in planning to protect workers’ entitlement to wages that they have earned and bring greater transparency and openness to the workplace.
The proposed rule would address notification of workers’ status as employees or some other status such as independent contractors, and whether that worker is entitled to the protections of the FLSA. The proposed rulemaking would also explore requiring employers to provide a wage statement each pay period to their employees.
But anti-wage theft activists are saying the rule is not taking effect quickly enough.
“We are encouraged that the DOL is proposing a regulation that would mandate pay stubs. But the devil is in the details,” says Ted Smukler, policy director at Interfaith Worker’s Justice Center, which has helped make the country’s wage theft crisis visible nationally. “The regulatory language has not been released, even while this has been on the DOL’s agenda since the fall of 2009. Meanwhile, tens of millions of workers are ripped off every week. Whether it’s through regulatory reform or passing national legislation mandating that businesses provide workers detailed pay records, something must be done.”
It goes without saying that struggling American workers need every dollar they earn in order to survive. But as the U.S. economy sputters back to life after the worst recession in 70 years, it’s worth pointing out that eliminating wage theft would not only be the just thing to do—it could prove an economic stimulus.
This blog originally appeared in www.inthesetimes.com on March 10, 2011. Reprinted with Permission.
About the Author: Mike Elk is a third-generation union organizer who has worked for the United Electrical, Radio, and Machine Workers, the Campaign for America’s Future, and the Obama-Biden campaign. Based in Washington D.C., he has appeared as a commentator on CNN, Fox News, and NPR, and writes frequently for In These Times, Alternet, The Atlantic and The American Prospect. Mike Elk is a labor journalist and third-generation union organizer based in Washington, D.C. He has written for Harper’s Magazine, the American Prospect and In These Times.