Posts Tagged ‘overtime pay’
Monday, July 13th, 2015
Millions of workers who have not been receiving overtime pay would become eligible under a newly announced rule change. According to the Economic Policy Institute, the number of newly overtime eligible workers could be as high as 15 million. The change would update what is known as the “white collar” exemption to the overtime pay rules that covers certain executive, administrative and professional employees. Currently, these types of employees can be classified as “exempt” (meaning not entitled to mandatory overtime pay) so long as they are paid a salary of at least $455 per week ($23,660 per year) – an amount that is below the poverty line for a family of four and that has not been adjusted since 2004. Under the new rules, the minimum salary requirement for exempt white collar workers would increase to $970 per week ($50,440 per year) for 2016 and be indexed going forward to keep pace with inflation. Workers whose salary falls below this level would now be classified as “non-exempt” and guaranteed time-and-a-half for all hours worked over 40 per week.
While some big business groups are opposing the proposed changes, claiming terrible economic consequences will result if their labor costs increase; this is nothing new and the same cry that is heard every time they are forced to increase wages. The facts and history do not, however, support their dire warnings. In cities such as San Francisco and Santa Fe where the minimum wage has for years been set well above the federal minimum, and even coupled with other employee benefits such as paid sick leave and health-care, the impacts on employment have been essentially zero. Contrary to the claims of catastrophic job loss and business closing, studies have shown “no measurable” negative effect on employment when cities or states have raised their minimum wage above the federal minimum wage. Historically, increased pay for workers tends to generate a positive feedback loop – workers earn more, spend more, resulting in positive economic activity.
To put the pay figures in perspective, look back 40 years. In 1975 the minimum salary amount was adjusted and set to $250 per week. At that time, 65% of the American workforce was paid less – entitling them to overtime pay. Today, however, a mere 11% of the workforce earn less than the $455 per week minimum. Today, the $250 per week minimum salary would equate to more than $980 per week (approximately $51,000 per year) if it had been annually adjusted per the Consumer Price Index. So, to merely keep middle-class workers in the same economic position they were in as of 1975, the current $455 per week minimum salary would need to be increased to at least $980 per week. This is roughly what is being proposed under the new rules.
The Fair Labor Standards Act (FLSA) was implemented in 1938 to specifically address the serious problems caused by the overworking and underpayment of our nation’s core middle-class workforce. The two primary reasons the FLSA was put into place are:
- First, to protect against working conditions that are “detrimental to the maintenance of the minimum standard of living necessary for health, efficiency, and general well-being of workers.” The law recognizes that employees need some time off to spend with family and relaxing from often stressful work and provides an economic incentive to not overwork employees. If an employer is going to demand work hours that deprive employees of this precious down time, the law places a premium value on such time – a cost that the employer must cover.
- Second, requiring the payment of time and a-half for all hours over 40 per week creates and strong economic incentive for employers to hire more people and spread the work, instead of overworking their existing staff. This helps to reduce overall unemployment in the U.S. economy, an issue every bit as relevant today as it was 75+ years ago.
The proposed changes to the overtime pay regulations are important to restore fair pay to millions of middle-class workers and are consistent with the overall goals and policy objectives that originally inspired the federal overtime pay laws.
About the Author: The author’s name is Jillian Johnson. Jillian Johnson is a freelance writer from New Jersey who has contributed to an array of blogs of various industries, particularly business, finance and health. She freelanced for a local NJ parenting magazine “Curious Parents” magazine and wrote for her college newspaper, “The Tower,” ultimately becoming the Editor-in-Chief. Jillian holds a BA in Communications and is currently working towards a BSN.
Wednesday, July 1st, 2015
President Obama’s administration took another promised step on Tuesday towards raising the living standards of American workers, and Republicans and business groups are not likely to be able to stop it.
Using the administration’s power to update workplace rules regarding premium pay for overtime work, the Department of Labor on Tuesday began taking steps that could bring higher pay or more leisure time to an estimated 5 million middle-income workers by next year.
Business and conservative groups are likely to try to block the new overtime rules with court challenges and legislation, just as Republicans are still blocking President Obama’s modest proposed legislative increase in the minimum wage to $10.10 for low-income workers. But the political and legal winds favor the administration.
There’s a strong legal and factual case for the Department of Labor’s action. The current regulations are grossly out-of-date and out of sync with the intention of the original legislation. According to administration calculations, the new rules should give at least 5 million middle-income workers a boost in pay if they work more than 40 hours a week or fewer unpaid hours at work and more time for themselves and their families if they are not forced into overtime work.
Now all hourly workers are guaranteed time-and-a-half pay for working more than 40 hours, but the rules do not require employers to pay time-and-half to salaried workers who make over $23,660 a year—even though that is below the poverty line for a family of four. Salaried workers below the threshold are regarded as being social equivalents to hourly workers. In 1975, 62 percent of salaried workers earned beneath the threshold and were guaranteed overtime pay by law, according to Ross Eisenbray of the Economic Policy Institute, but today the threshold only protects 8 percent of salaried workers. The new rules with a threshold of nearly $51,000 a year would provide overtime protection to about 44 percent of salaried workers.
If a salaried worker earns above the threshold and is a bona fide executive, administrative or professional employee, the employer does not have to pay him or her overtime. But this “white-collar exemption” is now widely abused, and employers give nominal managerial titles and a few administrative tasks to people in order to avoid paying time-and-a-half for more than 40 hours of work. Christine Owens of the National Employment Law Project, a pro-worker research and advocacy group, also wants the new rules to more adequately define the kind of work that qualifies for the white collar exemption. At this point, the Labor Department has not proposed such revisions in defining who is a manager or professional.
“While we appreciate that doubling the salary threshold will extend overtime pay protections to millions of currently exempt workers,” she wrote in an organizational statement on the rules, “we are concerned that failure to address the existing tests’ vague definitions, laissez-faire approach to the mix of ‘salaried’ and ‘hourly’ duties required for exempt status and other shortcoming threaten to deny far too many workers the overtime pay protections they deserve and the statute contemplates.” NELP, for example, wants the rules to state that exempt workers cannot spend more than half of their time on non-exempt work.
With unions at their weakest since the 1920s, more public policy action to raise wages is necessary, not only for minimum-wage workers but also for middle-income workers, such as those protected by overtime rules. Also, inequality continues to grow. University of California at Berkeley economist Emmanuel Saez recently calculated that despite recent growth in income of workers in the bottom 99 percent (an increase of 3.3 percent from 2013 to 2014), top 1 percent incomes grow faster and families in that sliver of the population captured 58 of real income growth per family from 2009 to 2014.
Overtime protection alone won’t reverse that trend, but it will make a real difference in the incomes and quality of life for millions of working families.
This blog was originally posted on In These Times on July 1, 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 [email protected]
Wednesday, June 17th, 2015
The Obama administration will soon unveil its new overtime pay rules, which will mean that millions of additional workers will get overtime pay when they work more than 40 hours a week. Many low-wage employers are obviously upset about this—they’ve been using the weak overtime rules to make salaried employees work more than 40 hours a week for no extra pay, and they like it that way. Industry groups have been trying to make the case for keeping the overtime eligibility level low—it’s currently less than $24,000 a year—but the Economic Policy Institute’s Ross Eisenbrey shows just how weak those arguments are, taking a National Retail Federation report to the woodshed:
If the threshold is raised to $42,000, the NRF predicts significant changes in retail employment: while some employers will raise salaries for employees near the threshold to guarantee that they continue to be excluded from overtime protection, many salaried employees (some of whom work 60-70 hours a week for no extra pay) will have their hours reduced and as a result, 76,000 new jobs will be created averaging 30 hours per week. Altogether, half of the retail workforce that is currently excluded from coverage will be guaranteed coverage by the law’s overtime protections. That all sounds pretty good to me.The NRF’s projections are intended to be critical of the Labor Department’s rules update, but I have a hard time seeing why it would be a bad thing to create 76,000 new retail jobs, given that 8.6 million Americans are currently unemployed. Moreover, if I were a poorly paid bookkeeper or clerk in a department store, working 60 hours a week and getting paid no more than if I worked 40 hours, I’d be happy to see my hours cut and the extra work shifted to hourly employees.
Eisenbrey also points out that the NRF report suggests that the lobby group doesn’t think its members are following existing law: One of the requirements to exempt workers from overtime eligibility is that a worker have a managerial role, but the NRF report lists many traditionally non-managerial jobs such as bookkeepers, clerks, and secretaries as exempt from overtime.
Raises for some, fewer hours of work for others, and job creation. Gosh, those are some terrifying predictions for changes in overtime rules.
This blog was originally posted on Daily Kos on June 15, 2015. Reprinted with permission.
About the Author: The author’s name is Laura Clawson. Laura Clawson has been a Daily Kos contributing editor since December 2006 and a Labor editor since 2011.
Friday, October 12th, 2012
In 2010, the military newspaper Stars and Stripes labeled Fort Lewis-McChord, a joint Army and Air Force base in Washington state, “the most troubled base in the military” due to its inability to treat post-traumatic stress disorder (PTSD) or address mental health problems. Fort Lewis-McChord has one of the highest suicide rates of army bases across the country, and last year had the highest number of total suicides with 16. It was where Sergeant Robert Bales was stationed right before he was shipped to Afghanistan and massacred 16 Afghan civilians–including nine children–last March. And it was where the soldiers who formed a “kill team” that murdered civilians in Afghanistan in 2010 had previously been stationed.
The murders of Afghan civilians and high rates of suicide among the soldiers stationed there are believed to stem from the failure of Lewis-McChord’s doctors to adequately treat mental health problems. In the past five years, approximately 300 soldiers saw their PTSD diagnoses reversed by doctors at the base. The Army is currently investigating whether doctors at Lewis-McChord reversed the diagnoses in order to save money.
Now, a Working In These Times investigation has found that workers assigned to help families suffering from the effects of PTSD have been told to close cases on suicidal patients in order to save money, haven’t been paid on time and have been forced to attend anti-union meetings that they claim the contractor, Strategic Resources Inc. (SRI), has billed to the federal government, in violation of federal law. (In July, an In These Times expose on union busting at Fort Lewis-McChord spurred a federal investigation into whether General Dynamics was illegally using government dollars to engage in union-busting.)
Kevin Cummings, an organizer with the International Association of Machinists (IAM), has been attempting to unionize mental health counselors employed by SRI at Lewis-McChord for the past several months. Counselors at the base tell Working In These Times they often have been told to close cases early in order to save money and to lie to federal investigators about how much the contractor was reimbursing them for driving expenditures. They also report being met with illegal threats and intimidation when they tried to unionize.
“[SRI] had no idea really what victim advocates do,” says Kara Karlson, a former counselor with SRI’s Victim Advocacy group. “It’s just completely about money-making. When we were hired on, they didn’t send us any training materials. I got a company handbook that was only eight pages long. They would do whatever they could to save a penny for themselves and hang you out to dry.”
“There was a lot of pressure to close cases quickly even if we didn’t feel like we should close them,” says another counselor who works in SRI’s New Parents Support Program, and who requested anonymity out of fear of being fired. “I had a friend who was working with a family that had a suicidal teenager and was told to back away from the family. She refused to back away. They wanted other services to take on the risk of dealing with someone who is suicidal.”
“[Workers] are directed to keep a certain number of cases open and keep a certain number of cases closed,” says IAM’s Cummings. “The lead will tell them, ‘You have too many cases open, close that one.’ They are telling them to close cases on people on suicide watch. If [SRI] need [to hire] additional bodies, they need to get them. Maybe the contract needs to be opened to help them hire additional people.”
In addition to finding it difficult to provide proper treatment, counselors in SRI’s New Parent Support Program and its Victim Advocacy Group say their pay was cut by as much as 25 percent when SRI took over their contract three years ago.
Most federal contractors must abide by the Service Contract Act, which mandates that workers be paid the prevailing wage for the job in the region. However, workers at SRI, many of whom have master’s degrees, allege the company misclassified them as less skilled employees. As a result, they make only $27.50 per hour, instead of the $36.05 per hour that would be mandated under the Service Contract Act’s provisions if they were classified properly. The workers hope that if the Department of Labor reviews their contract, it will find that their work falls under the better-paying classification.
In addition, SRI has refused to pay workers overtime, claiming that they are exempt under the Fair Labor Standards Act, according to Cummings. However, he says that isn’t actually the case.
“Read the act,” Cummings says. “It says they are not exempt if their work is preventive or investigatory in nature. The VA [Victim Advocates] Group absolutely meets those criteria, [and] the NPSP [New Parents Support Program] seems to as well. NPSP has to provide me a full breakdown of their duties, but the job description and service contract for them indicate they should not be exempt either.”
Workers at SRI say that to keep them from joining together to demand higher wages, the company instituted a rule prohibiting them from talking to each other about their wages. Such a rule would violate the National Labor Relations Act, which allows workers to discuss their wages.
Along with the low pay and unpaid overtime, workers claim the company routinely delays compensating them for the gas mileage that they accrue when driving to meet families in crisis or victims of crime or abuse. “We would spend $250 a month on gas sometimes and have to wait up to five months to get paid,“ says one worker with New Parent Support Program, who requested anonymity out of fear of losing her job.
When workers informed the Department of Labor about the delays, the department sent an investigator to examine the complaints. That prompted an SRI manager to tell workers to lie about their gas mileage, according to one worker. The worker cites a May 12, 2012, conference call in which the manager instructed workers to redo their forms and change key information, such as the number of miles that they had driven.
Finally, after seeing another group of SRI workers employed as IAM-unionized truck drivers picket Fort Lewis-McChord over their greivances, counselors in SRI’s New Parent Support Program and Victim Advocacy Group decided to organize with IAM. SRI responded with behavior that the union claims was illegal.
According to email exchanges and conversations with the workers, in July, the nine women employed as counselors in SRI’s Victim Advocacy Group say they were forced to attend a meeting in which an outside consultant warned them about the dangers of joining a union. In August, 14 counselors with the New Parent Support Program were also forced to attend meetings in which the same consultant spoke out against unionizing.
In both instances, workers claim they were forced to bill the time attending the meetings to the federal government. President Barack Obama’s Executive Order 13494, which went into effect last December, prohibits federal contractors from being reimbursed for the cost of their anti-union activity. (In an interesting side note, SRI Presdient Rose McElrath- Slade and her husband Cleveland Slade were major donors to Obama, giving a combined $100,000 to his inauguration fund in 2008.)
“The workers were mandated to attend the meetings, then directed to charge as though they were working on their normal jobs,” says Cummings. “Our money is not supposed to be used for this. Our money is supposed to support our rights, not deny them.”
The command of Fort Lewis-McChord did not respond to multiple requests for comment.
In an email to Working In These Times, an SRI spokesperson wrote, “Your inquiry is the first we have heard of this. SRI strives to comply with all applicable laws/regulations and to honor our commitments to our customer, the federal government. We have different levels of review for timesheets for accuracy. Any error identified is corrected to ensure compliance.”
On July 31, the nine counselors of SRI’s Victim Advocacy Group voted to join IAM. The 14 in the New Parent Support Program are still in unionization talks with IAM, despite being forced to attend the anti-union meetings that they claim were billed as regular work to the federal government.
“There is a problem when they are using taxpayer money to deny taxpayers their basic rights,” says Cummings. “If they want to talk their employees out of unionization, that’s fine, but don’t send taxpayers the bills on it.”
This post originally appeared in Working In These Times on October 3, 2012. Reprinted with permission.
About the Author: Mike Elk is an In These Times Staff Writer and a regular contributor to the labor blog Working In These Times. He can be reached at [email protected]
Friday, July 13th, 2012
I do not live in Scranton, Pennsylvania, nor do I know the political leanings of the mayor or the city council; however, I do know that their actions, cutting the wages of city employees to minimum wage, are shameful. By the way, that wage cut applies to firefighters and police officers as well as a myriad of other city employees.
The employee’s unions are fighting back and are taking the city to court:
The trio of unions – International Association of Firefighters Local 60, the Fraternal Order of Police E.B. Jermyn Lodge 2 and the International Association of Machinists and Aerospace Workers Local Lodge 2305 – expect to soon file several new legal actions, said their attorney, Thomas Jennings. Those actions would include:
- A motion in Lackawanna County Court to hold the mayor in contempt, due to paying 398 city employees minimum wages in their paychecks Friday, even though a judge on Thursday and Friday ordered full wages.
- A lawsuit in U.S. District Court in Scranton under the Fair Labor Standards Act alleging the city has failed to pay wages on time and failed to pay overtime.
- Another federal complaint alleging violations of the Heart and Lung Act, because benefits of disabled police and firefighters also were cut to minimum wages without first having a required hearing.
- A penalty petition with the state workers’ compensation commission over the minimum wages.
“Pick a law. They violated it,” Mr. Jennings said.
The city is claiming that it had no choice as it only has $133,000 in cash on hand as of Monday but owed $3.4 million dollars to vendors, not including employees:
A payroll every two weeks amounts to $1 million, officials said. To free up cash to pay overdue bills, particularly health coverage, the mayor on June 27 announced he was indefinitely cutting salaries of all non-federally funded employees to the federal minimum wage of $7.25 an hour. This way, the payroll every two weeks would amount to $300,000, though [the mayor] pledged to pay all back wages once the crisis is resolved.
Sure, he will pay the workers back once the crisis is resolved, and I bet while he is at it he will toss in some oceanfront property in Arizona and a bridge in Brooklyn.
Now, of course if you go through the comments sections on any news story about the goings on in Scranton you will find that they are, unfortunately, quite typical these days. Those fatcat public employees and their unions are all to blame for Scranton’s and the nation’s woes. Yep, that cop who at 3:00 am is chasing down a guy who just robbed someone’s house is the problem. The firefighter who pulled a sleeping child out of a burning home is the problem. That guy over there who tests the tap water to make sure it is clean and safe to drink; it is his fault that Scranton and the nation as a whole is broke.
This blog originally appeared in Daily Kos Labor on July 11, 2012. Reprinted with permission.
About the Author: Mark Anderson, a Daily Kos Labor contributor, describes himself as a 44 year-old veteran, lifelong Progressive Democrat, Rabid Packer fan, Single Dad, Part-time Grad Student, and Full-time IS worker. You can learn more about him on his Facebook, “Kodiak54 (Mark Andersen)”
Thursday, September 9th, 2010
You are deep in mandatory overtime (which you don’t get OT pay for) and you’re so exhausted that you start making really bad mistakes – dangerous mistakes.
We’ve all been there in one way or another in our working lives, but what if you were a patient and the exhausted worker making the mistakes was your resident physician? Obviously it can be a life or death situation for you. Resident physicians work shifts as long as 30 hours as often as three times a week, which can lead to physician fatigue and medical errors.
“As future physicians, we greatly value the well-being of our patients and know that we can serve them better if we are well ourselves,” says Sonia Lazreg, health justice fellow with the American Medical Student Association (AMSA).
Dr. Charles Preston, a researcher with Public Citizen’s Health Research Group and preventive medicine resident at Johns Hopkins School of Public Health says, “After a busy night on call, I remember a couple of times when I literally fell asleep on my patients standing up during morning rounds. I’d fall asleep while writing my patient progress notes. And driving home, I was careful to turn up the radio or blast the air conditioning so that I would at least have something more to keep me awake.” Can you imagine?
So, why is this dangerous system still in place?
Despite evidence that excessive work hours contribute to depression, car crashes, needle stick injuries and even premature labor for pregnant physicians, there are no Occupational Safety and Health Association (OHSA) rules protecting residents from these risks.
OSHA, which is part of the Department of Labor, is responsible for enforcing safety and health legislation, and it just doesn’t have the doctors-in-training on its radar … yet!
To get the OSHA radar blipping, consumer and health advocacy organizations delivered a petition to the agency today. You can read the petition here, and at the bottom of this entry you can see the full list of those petitioning OSHA.
The federal government already regulates work hours and sets rest-period requirements in a variety of industries, including the highway, aviation, railroad and maritime transportation industries, because fatigue plays a major role in transportation safety. In none of these industries are workers allowed to work hours even remotely as long as these physicians. Resident physicians deserve to have similar protections from excessive work hours that don’t give them adequate rest.
“OSHA must intervene so that physicians in training are no longer at risk for needle stick injuries, car crashes and other hazards that we know stem from chronic sleep deprivation.” says CIR/SEIU Healthcare President Dr. Farbod Raiszadeh.
Please get involved with this important situation. It will help you at the same time as some hardworking people.
For ideas on how to get involved, and to see this original article, visit SEIU.
About the Author: Richard Negri is the founder of UnionReview.com and is the Online Manager for the International Brotherhood of Teamsters.
Monday, December 7th, 2009
Workers employed in low-wage and poorly regulated industries (most prominently restaurants, residential construction, domestic cleaning, and mechanics) are confronted with staggering exploitation as employers look to cut corners in today’s recession. Such exploitation includes health and safety violations, discrimination, sexual harassment, retaliation, firing for participating in union activity, and wage theft—failure to pay workers for work performed, including overtime hours and final pay periods.
To combat this wave of illegality, a Chicago worker center has collaborated with a local university to create a map of law-breaking employers against which they have organized, giving workers and activists a powerful visual tool to bring to politicians and the community.
The Arise Chicago Worker Center has no shortage of evidence for the dire conditions facing Chicago’s low-wage workers, having collaborated with over 2,050 workers in the past seven years.
None of the restaurant workers who have contacted our organization during that time received overtime wages. One of our members seriously injured his back at a construction site, but his employer refused to pay legally required workers’ compensation. One African-American member, who works for a state-funded social service agency, has consistently received paychecks one to three weeks late, for more than two years. A group of candy manufacturers were denied bathroom breaks.
Recently, we spoke with a Guatemalan immigrant car wash worker who works from 7 a.m. to 8 p.m., six days a week, for $5.25 an hour. He does not receive overtime pay and takes home an average of $9 a day in tips. If that weren’t enough, the employer does not provide gloves needed for the work, and illegally deducts the cost of the workers’ required uniform from his paychecks.
With the help of the University of Illinois-Chicago Center for Urban Economic Development, Arise has mapped by ward—a political district—the law-breaking employers against which Arise has organized. The maps illustrate law-breaking employers in 43 of Chicago’s 50 wards, affecting workers living in 47 of the wards.
Groups of worker center members plan to meet with their ward aldermen to discuss workplace abuses and enlist support for a city response to the biggest problem facing low-wage workers: wage theft.
Clergy whose congregations are located in the 43 wards will join the workers. Recently, Catholic Bishop John Manz attended a meeting with Alderman Danny Solis in the 25th Ward, where Arise has recorded a dozen labor violations.
Solis committed to introducing the issue to the city council’s Hispanic Caucus, whose wards include great concentrations of Arise membership. Alderman Mary Ann Smith’s office offered to explore legislative strategies that could deny additional business permits to law-breaking employers. Additional meetings and research are planned to determine the best approach to address wage theft in Chicago—which may include a citywide ordinance that could make stealing a worker’s wages treated like other forms of theft.
*This post originally appeared in Labor Notes on December 3, 2009. Reprinted with permission from the author.
About the Author: Adam Kader (www.arisechicago.org) is the director of the Arise Chicago Worker Center, part of the national Interfaith Worker Justice network.
Friday, November 20th, 2009
Workers, community leaders and religious activists are holding rallies, prayer vigils and other actions in more than 40 cities around the country today as part of a National Day of Action to Stop Wage Theft.
Wage theft is a national epidemic, which robs millions of workers of billions of dollars they’ve worked for but never seen, says Kim Bobo, executive director of Interfaith Worker Justice (IWJ) and author of the book Wage Theft in America.
During a Capitol Hill press conference this morning, Bobo said:
Too many workers can’t buy a Thanksgiving turkey because employers have stolen their wages. Wage theft is not a small, isolated situation. It’s a national epidemic.
Wage theft affects workers like Cleve Williams, who worked for a city contractor in Cincinnati. Williams told the press conference he was fired after he organized his fellow workers to fight for a living wage. The city’s law required the comapny, which holds a city contract, to pay a minimum wage. But Williams says it took three years to get the wages raised to the legal level.
Bobo cited a study by the National Employment Law Project, which shows how widespread wage theft has become. Drawing on in-depth interviews with 4,387 workers in Los Angeles, Chicago and New York City, a group of respected academics estimates that 68 percent of the workers surveyed are routinely denied proper overtime pay and often are paid less than minimum wage. The average low-wage worker lost more than $2,600 in annual income due to the violations, 15 percent of their annual earnings. Click here to read the report, “Broken Laws, Unprotected Workers.”
AFL-CIO Executive Vice President Arlene Holt Baker, speaking to the press conference by phone, said the nation’s economy suffers when millions of workers are denied their just pay. Unions are the first line of defense against wage theft, she added. With a union contract, workers don’t have to worry about not getting paid for overtime or not getting a decent, living wage and other benefits.
Wage theft is not only an economic issue, but a moral one, says Thomas Shellabarger, of the Department of Justice, Peace and Human Development at the U.S. Conference of Catholic Bishops.
As we pause this Thanksgiving to remember all that we are thankful for, we also remember the workers across the nation whose wages are stolen and struggle to put a meal on their holiday table. We must put an end to this national scandal of wage theft.
*This article originally appeared in AFL-CIO blog on November 19, 2009. Reprinted with permission from the author.
**For more information on unpaid wages visit our Workplace Fairness resource page.
About the Author: James Parks had his first encounter with unions at Gannett’s newspaper in Cincinnati when his colleagues in the newsroom tried to organize a unit of The Newspaper Guild. He saw firsthand how companies pull out all the stops to prevent workers from forming a union. He is a journalist by trade, and worked for newspapers in five different states before joining the AFL-CIO staff in 1990. He has also been a seminary student, drug counselor, community organizer, event planner, adjunct college professor and county bureaucrat. His proudest career moment, though, was when he served, along with other union members and staff, as an official observer for South Africa’s first multiracial elections. Author photo by Joe Kekeris
Tuesday, September 29th, 2009
(Reposted from Open Left)
Wage Theft Is Rampant-Estimated at Roughly $2.9 Billion Annually
Last week I wrote a diary on a new report about widespread wage theft among low-income workers, “”Broken Laws, Unprotected Workers””. I said that I was working on an article for Random Lengths News. It was published on Thursday, and I’m republishing here below.
Property crime is a serious concern in America today. In 2007, the total dollar value of all property officially reported stolen in California-population about 38 million-was just over $2.8 billion, almost half of which was motor vehicle theft. The rest came to $1.47 billion. Of that $2.8 billion close to one-third of it was recovered-$912 million.
But a new report indicates that these statistics are woefully incomplete. “Broken Laws, Unprotected Workers” finds that wage theft is rampant among the bottom 15 percent of the workforce, and so widespread that workers in just three cities-Los Angeles, Chicago and New York City (total population about 15 million)-had roughly $2.9 billion in wages stolen from them in 2008, a rate more than double that of reported theft in California. As for recovering any of it, workers were more likely to get fired for asking than ever seeing a dime of what had been stolen from them.
“The reason we did this study, we were running to into this in our qualitative work,” said Ruth Milkman, a professor of sociology at UCLA who was one of eleven co-authors of the report. “My collaborators had all encountered this,” she said, “But nobody really knew how common it was. We thought, wow, we could really figure this out.”
Paul Rosenberg :: Robbed On The Job
The study involved a representative survey of 4,387 workers, who were robbed in various different ways. More than two-thirds-68 percent-experienced at least one pay-related violation the previous work week. The average stolen was $51-bad enough for anyone. But these are the lowest-paid workers in the economy.”Their average earnings for a week were $339,” said Milkman. “The amount lost was 15 percent.”
This equals an average yearly loss of $2,634 out of $17,616. The report estimates that over 1.1 million workers are affected. But they weren’t the only ones hurt, Milkman noted. “If these people were being fully paid, they would spend it locally and local businesses and communities would benefit,” she pointed out.” What’s more, she added, it also hurts companies that are obeying the law, and paying workers what they’re owed, making it harder for them to compete with lawbreakers.
Breaking the violations down, the report found that 26 percent of those surveyed were paid less than the minimum wage the previous work week. Of those, 60 percent were robbed of more than $1 per hour. Over one quarter worked more than 40 hours the previous week, of which 76 percent were robbed of legally required overtime pay. On average, this amounted to 11 hours of overtime “either underpaid or not paid at all.”
Additionally, almost 40 percent of those surveyed worked off the clock-either before or after their paid shift. Of these 70 percent were not paid for their extra work.
Milkman cites one example of a nurse’s aide she interviewed. “She told me that over and over again she would clock out for the day, and then the supervisor would say, ‘Maria, could you check in on so-and-do in Room 23?'”
Adding insult to injury is the feeling of helplessness. “She didn’t feel she could do anything about it,” Milkman said.
That feeling is common among crime victims-but how many other sorts of crime victims are victimized day after day, week after week? And what does it means to be robbed by someone you interact with every day? What does this do corrode people’s determination and belief in the American dream?
“Great question,” Milkman responded, “But not one we tried to probe, so I can’t presume to comment.”
Tipped jobs not only suffered sub-standard pay-30 percent were paid less than the tipped worker minimum wage-but also theft of their tips-which was reported by 12 percent of tipped workers.
In a country where crime stories pepper the local tv news every night, it’s astonishing that such a massive crime wave has been going on, virtually undetected right under our noses. One reason for this is what happens to the victims if they try to complain. According to the report, one in five workers reported trying to complain to their employer, or trying to form a union in past year. For their troubles, “43 percent experienced one or more forms of illegal retaliation from their employer or supervisor.” These included suspensions or firing, threats to cut hours or pay, and threats to call immigration.
“One case that really affected me involved a woman, a housekeeper in a hotel chain, well-know, but I can’t say which one, in the Valley,” Milkman recalled. “She cleaned rooms in the hotel. She was undocumented. She received her pay in cash. She wasn’t paid even minimum wage. She worked over 40 hours a week. Finally, she complained to the supervisor and was told they didn’t need her the next week. She was fired.” But there was more. “This is also a tale about tip work,” Milkman explained. “When she got done cleaning, the supervisor would go into the rooms before she returned, to steal her tips.”
“I was in tears when I heard that,” Milkman said.
There are things that can be done, and the report cites three principles that it says “should drive the development of a new policy agenda to protect the rights of workers.” First is to strengthen enforcement of existing labor laws, both by increased staffing and by new enforcement strategies. Second is updating legal standards for today’s labor market-including strengthening the right to organize. Third is to establish equal status for immigrants in the workplace.
Now that the problem is known, action is possible-but not guaranteed. Labor Secretary Hilda Solis has promised increased enforcement, Milkman noted, but that’s only one part of the solution. Key to a full solution is public sentiment and political will.
“The danger with this is, this is a new enough phenomena that people are horrified when they hear about it,” Milkman said. “But the real danger is that it becomes a part of the economic landscape,” she cautioned. “Now the question is what are we going to do about it?”
There is a real danger that it could become something that we simply accept, she warned And here Milkman drew an analogy to the emergence of mass homelessness in the early Reagan era. “When it first started, there was a lot of distress and intense discussion and debate about it, and now we take it for granted. It’s like we live in India.”
The hope is that times are different now, and the direction of the economy can change.
“These laws were put in place when the economy changed directions during the Great Depression,” Milkman said. “We have an opportunity, with the Obama Administration, to change directions again.”
“But it’s not just going to happen,” she warned. “People have to push for it.
About the Author: Paul Rosenberg is progressive activist and journalist who is a frontpage blogger for OpenLeft.org and Senior Editor for Random Lengths News, an alternative bi-weekly in the Los Angeles Harbor Area, where he specializes in labor, community and environmental justice issues. From his anti-war and civil rights activism as a teenager in the 1960s, through his involvement in food co-ops in the 1970s, to his Central American solidarity work, media and renters’ rights activism in the 1980s, and beyond, he has focused his energy primarily on issue activism, with increasing attention to media from the mid-1980s on. He began working as a freelance journalist with a primary focus on op-eds and book reviews in 1994, and joined Random Lengths News in 2002. He’s been published in the Progressive magazine, Publishers Weekly, the LA Times, Christian Science Monitor, and Dallas Morning News.
This article originally appeared in Open Left and Random Lengths News on September 27. 2009. Re-printed with permission from the author.
Tuesday, April 7th, 2009
On Thursday, March 19, 2009, the Ninth Circuit Court of Appeals reversed a District Court’s order and reinstated a class action lawsuit against FedEx Kinko’s Office and Print (“FedEx”) seeking unpaid overtime and related penalties on behalf of a class of hundreds of the company’s Center Managers. This short three page decision carries monumental implications which extend far beyond the class members of this single action to reinforce the rights of all California employees who are paid on a “salaried” basis and denied compensation for their overtime work.
The case filed in May 2005 alleged that Center Managers at FedEx’s California Stores were improperly classified as “exempt” from overtime pay under California law on the basis that these employees met what is commonly referred to as the “managerial” exemption. Under California law, exemptions from overtime pay are narrowly construed and the employer has the burden to prove the exemption applies. For the managerial exemption to apply, the employer must prove, among other things, that the employees spend more than one-half of their work time on exempt duties and “customarily and regularly” exercise discretion and independent judgment under Cal. Labor Code § 515.
The case was certified as a class action in 2006. In May 2007, FedEx moved for summary judgment asking the District Court to conclude that the entire class was exempt from overtime under California’s “executive” exemption. The District Court agreed and granted Defendant’s motion. The Plaintiff appealed to the Ninth Circuit seeking to have that decision overturned.
The Ninth Circuit reversed the District Court’s decision holding that the class members testimony and expert witnesses raised triable issues regarding whether the Center Managers were primarily engaged in management duties. The decision is important as it reinforces the heavy burden employers must meet in order to show that their employees are spending at least half of their time on exempt tasks – merely referring to those employees as “managers” is not enough.
By reversing the District Court’s finding for FedEx, the Ninth Circuit sent a clear message of the Court’s intention to require employers who seek to circumvent overtime laws by paying their employees fixed salaries to provide substantial evidence to support these decisions – rather than merely referring to thoseemployees as “managers”. The fact that the decision was issued a mere eight days after the hearing is somewhat unusual and bodes well for the rights of all salaried employees throughout the state.
In light of the ruling, the parties will be proceeding toward trial. If successful there, hundreds of FedEx Center Managers could recover compensation for years of lost wages. Employees with similar claims would be well advised to strike while the iron is hot in seeking to recover owed wages pursuant to this ruling. If you are currently working in the state of California and are not receiving overtime pay (or if you are an attorney currently representing such an employee), please visit the Scott Cole & Associates, APC website to obtain further information regarding this lawsuit.
About the Author: Matthew R. Bainer, Esq. is an experienced and successful advocate of employees’ rights and has successfully represented tens of thousands of employees, both in California and throughout the nation. Mr. Bainer, a well-respected practitioner in his field, has written for both legal periodicals and academic law reviews. For more information about Mr. Bainer and his firm, please visit the Scott Cole & Associates, APC website at www.scalaw.com.