After the Connecticut labor department conducted random inspections at 25 nail salons, it found that 23 were violating wage laws and shut them down.
In the first enforcement of nail salons in the state, the Department of Labor’s Wage and Workplace Standards Division found that the vast majority were paying employees in cash without keeping payroll records, allowing them to duck paying Social Security and unemployment taxes, and many of them were not being paid the state’s minimum wage of $9.15 an hour nor overtime. At one salon, the employees were paid just $40 for a 10-hour day.
The department ordered the offending salons to pay at least $62,000 in back wages to more than 50 workers. They will also have to pay $130,000 in civil penalties for underreporting payroll, violating wage and hour laws, and having improper workers’ compensation coverage.
The enforcement actions came after the state’s labor department received complaints from workers who had read an expose in the New York Times on illegal labor and health practices. Those stories have led to many other significant changes in the salon industry, although mostly focused so far in New York. Gov. Andrew Cuomo (D) created a task force to conduct nail salon inspections and institute new rules, has pushed for legislation to crack down on salons and give the state more power to shut them down, and launched a public education campaign that requires salons to post a “manicurists’ bill of rights” so that workers and the public are aware of legal requirements. The task force has inspected 755 salons and issued 1,799 violations.
Even when wage violations are uncovered and state regulators order owners to give employees back pay, workers may not see any money because salons simply shut down and hide their assets. To combat that issue, last week Cuomo put a new rule into effect requiring all nail salon owners to secure wage bonds in order to pay any future legal judgements against them.
The focus has also expanded beyond nail salons. Cuomo has also created a task force among 10 agencies to combat exploitation and abuse in 13 other low-wage industries, including domestic workers, restaurants, retail, farms, construction, and car washes. Wage abuse and health risks are also widespread in other beauty services such as the hair salon industry and waxing salons.