According to a new report — “the most comprehensive examination of wage-law violations in a decade” — labor protections in America “are failing significant numbers of workers.” 68 percent of the low wage workers who were interviewed for the report said they were subjected to pay violations in their previous work week alone. This included 26 percent who were paid less than the minimum wage and 76 percent who didn’t receive legally required overtime pay.
The researchers discovered that “the typical worker had lost $51 the previous week through wage violations, out of average weekly earnings of $339. That translates into a 15 percent loss in pay“:
“The conventional wisdom has been that to the extent there were violations, it was confined to a few rogue employers or to especially disadvantaged workers, like undocumented immigrants,” said Nik Theodore, an author of the study and a professor of urban planning and policy at the University of Illinois, Chicago. “What our study shows is that this is a widespread phenomenon across the low-wage labor market in the United States.”
As Kevin Drum put it, “How many reports of mistreatment do we have to get before we finally figure out that labor violations are rampant in this country?” And the problem has only gotten worse during the recession. “[Wage theft is] definitely on the rise nationally because of the economic crisis,” says Ted Smukler, public policy director of Interfaith Worker Justice. “Employers are desperate to shave corners when their profits are going down, and some are just greedy.”
There are a few things that need to happen to begin to address this problem. First, the Labor Department’s effort to hire 250 more wage and hour investigators should be complemented by the Senate confirming the Labor Department nominees who are still stuck in no-man’s land. This will help put in place people willing to enforce the wage laws that are on the books, but were neglected under former Labor Secretary Elaine Chao.
Furthermore, as David Madland and Karla Walter pointed out, the administration should work with Congress “to increase maximum allowable fines” for labor violations, as “the civil and criminal penalties are simply too low to deter or even adequately punish lawbreakers.”
As Annette Bernhardt, an author of the study and policy co-director of the National Employment Law Project said, “these practices are not just morally reprehensible, but they’re bad for the economy.” And they’re also preventable, if the Labor Department actually makes a commitment to enforcing the law.