Editorial: State right to address wage theft

Posted by National Alliance for Fair Contracting on

By Jeff Stahla 
POSTED:   01/24/2015 11:42:50 PM MST

 

When the Wage Protection Act went into effect Jan. 1 of this year, it gave the state of Colorado additional tools and authority to address the problem of wage theft.

The act requires employers to keep payroll records for up to three years and gives the Colorado Department of Labor the authority “to mediate situations that are just misunderstandings, investigate when there’s actual wrongdoing, and bring justice,” Rep. Jonathan Singer, a co-sponsor of the act, told the Associated Press.

That includes possible fines against employers who fail to respond to complaints and who are found to have illegally withheld wages from employees who earned them.

The number of state employees involved in investigations is increasing from four to nine, as part of the new law.

The need is clear. The state department of labor has been receiving an average of 5,000 complaints per year, and it has recovered about $1 million in unpaid wages to date, according to a recent I-News report.

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Texas House Panel finds that worker misclassification “compromises free markets” and promotes “lawlessness”

Posted by National Alliance for Fair Contracting on

By Scott Braddock
January 23, 2015

 

A report from a bipartisan panel of Texas lawmakers says companies that pretend their employees are independent subcontractors are undermining free markets and encouraging illegal immigration, among other serious problems. The practice of worker misclassification happens when an employer intentionally skirts the law by paying workers as independent subcontractors when they meet the legal definition of employees and should be paid as such.

Preventing workers from being paid as employees denies them basic protections and costs taxpayers millions each year because employers are avoiding payroll taxes on that labor. Employers who follow the law are investing in a sustainable workforce, which is undermined by worker misclassification. Many of those ethical employers have urged lawmakers to do more to contain what they’ve called “a cancer” in the heart of the construction industry.

So, the Texas House Business and Industry Committee this past year took an in-depth look at the issue, including testimony from construction industry leaders, labor advocates and others who are united in combating misclassification.

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D.C.’s New Wage Theft Law Imposes Additional Notice, Posting and Recordkeeping Requirements on Employers

Posted by National Alliance for Fair Contracting on
Friday, January 23, 2015

Last October, we reported on D.C.’s soon-to-be-enacted D.C. Wage Theft Prevention Amendment Act. This Act, which amends several existing D.C. wage and hour laws, includes new notice requirements and retaliation protections, increases employer liability for wage and hour violations and introduces a new administrative hearing process – all changes that employers with D.C.-based employees need to be aware of.

The Act becomes effective on February 26, 2015.  Previously, the Act was slated to go into effect on January 14, 2015, but an emergency amendment pushed back that date.  There is a chance it is pushed back again and we will update this post accordingly if that happens.  An overview of the key provisions follows below.

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US Labor Department and Wisconsin Department of Workforce Development sign agreement to reduce misclassification of employees

Posted by National Alliance for Fair Contracting on

WHD NEWS Brief: 1/20/2015 
Release Number: 15-0062-NAT

Description: Officials from the U.S. Department of Labor and the Wisconsin Department of Workforce Development signed a memorandum of understanding with the goal of protecting the rights of employees by preventing their misclassification as independent contractors or other nonemployee statuses. Under the agreement both agencies will share information and coordinate law enforcement.

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(Copy of MOU)

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Analysis Finds Rampant Wage Theft Across Colorado

Posted by National Alliance for Fair Contracting on

Monday, January 19, 2015
By Rocky Mountain PBS I-News & Anna Boiko-Weyrauch

From telemarketers to tortilla manufacturers, workers in myriad industries have suffered from employers failing to pay them wages they are owed, a Rocky Mountain PBS I-News investigation has found.

While blue-collar workers are most frequently cheated, workers across pay-scales in Colorado are vulnerable to wage theft – a term for employers illegally withholding wages – an analysis of federal enforcement data shows.

Since 2005, the federal Department of Labor has recovered more than $31 million in wages that had been illegally withheld by employers in Colorado in violation of the Fair Labor Standards Act.

Across the U.S. the amount of illegally withheld wages was more than $1.4 billion for the same period.

Under the Colorado Wage Claim Act, employers who cheat workers out of wages can face a misdemeanor charge, $300 fine and 30 days in a county jail – penalties the General Assembly put in place in 1941 that have not changed since.

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Labor and Employment Federal Regulatory Reporting and Other Requirements in the First Quarter of 2015

Posted by National Alliance for Fair Contracting on

1/14/2015 by Robert Lian, Brian Glenn Patterson

 

There are several important dates that employers should keep in mind during the first quarter of 2015. While some are long-standing requirements, others are the product of recent regulatory action by the Obama administration.  Key dates appear below.
Effective January 1, 2015
Occupational Safety and Health Administration/U.S. Department of Labor Expansion of injury and illness reporting requirement

 

Historically, employers have been required to report to OSHA within eight hours any occupational fatalities and occupational injuries and illnesses resulting in the hospitalization of three or more employees. OSHA’s updated recordkeeping and reporting rule expands the list of injuries that employers must report to OSHA.  As of January 1, 2015, all employers must report the following:

Within 8 hours:

All work-related fatalities; and

Within 24 hours:

All work-related inpatient hospitalizations to any employee (no longer limited to three employee hospitalizations);

All work-related amputations; and

All work-related losses of an eye.

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US Labor Department signs agreement with Florida Department of Revenue to reduce misclassification of employees

Posted by National Alliance for Fair Contracting on
U.S. Dept. of Labor
Wage and Hour Division 
Release Number: 15-34-NAT
Date: January 13, 2015 

WASHINGTON — Officials from the U.S. Department of Labor and the Florida Department of Revenue today signed a memorandum of understanding with the goal of protecting the rights of employees by preventing their misclassification as independent contractors or other nonemployee statuses. Under the agreement, both agencies will share information and coordinate law enforcement. The MOU represents a new effort on the part of the agencies to work together to protect the rights of employees and level the playing field for responsible employers by reducing the practice of misclassification. The Florida Department of Revenue is the latest state agency to partner with the Labor Department.

In Fiscal Year 2013, WHD investigations resulted in more than $83,051,159 in back wages for more than 108,050 workers in industries, such as janitorial, food, construction, day care, hospitality and garment. WHD regularly finds large concentrations of misclassified workers in low-wage industries.

“Misclassification deprives workers of rightfully-earned wages and undercuts law-abiding businesses,” said Dr. David Weil, administrator of the Wage and Hour Division. “This memorandum of understanding sends a clear message that we are standing together with the state of Florida to protect workers and responsible employers and ensure everyone has the opportunity to succeed.”

“Working with the states is an important tool in ending misclassification,” said Wayne Kotowski, the Wage and Hour Division’s regional administrator for the southeast. “These collaborations allow us to better coordinate compliance with both federal and state laws alike.”

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Feds, Florida reach deal on construction industry rip-off

Posted by National Alliance for Fair Contracting on

BY NICHOLAS NEHAMAS
01/13/2015 7:39 PM

 

Taxpayers were cheated.

Workers were swindled out of a fair shake.

Law-abiding businesses were forced to cut corners or go belly up.

A year-long investigation by Miami Herald and McClatchy Newspapers published in September found all this and more in Florida’s construction industry during the recession.

Publicly available documents and interviews with workers around Florida showed that contractors broke state law and cheated on their taxes in order to get work on the federally financed projects that were the lifeblood of the building industry between 2009 and 2013.

Now the U.S. Department of Labor has announced an agreement with the state Department of Revenue to crack down on the accounting trick that bad actors use to evade taxes and cheat their employees.

The problem, known as “worker misclassification,” happens when companies treat their workers as independent contractors instead of permanent employees. The companies don’t withhold income tax or file payroll taxes on those workers. They don’t pay unemployment taxes.

US Labor Department sues Little Rock, Arkansas, electrical contractor for failing to pay federal contract workers properly

Posted by National Alliance for Fair Contracting on
U.S. Department of Labor
Wage and Hour Division

Release Number: 14-2243-DAL
January 7, 2015 

LITTLE ROCK, Ark. — The U.S. Department of Labor has filed a lawsuit with the Office of Administrative Law Judges against LRE Royal Electrical Contractors Inc. and its owner, George E. Smith, to recover $345,077 in back wages for 61 electrical workers. The action also seeks to prevent the company and Smith from obtaining federal contracts for three years.

The filing alleges Smith and his company, doing business as both LRE Electrical Contractors and LRE Electrical, violated the Davis-Bacon and Contract Work Hours and Safety Standards Acts when they paid electrical workers less than the applicable prevailing wage rates and corresponding overtime wages for work performed as part of four government contracts.

The Wage and Hour Division’s Little Rock District Office found that LRE Electrical and Smith did not register electrical workers in approved apprenticeship programs, but classified and paid workers as apprentices. The company and Smith also failed to pay these workers wage rates included in the contracts, which are based on the work an employee actually performs.

“Government contracts specify clearly how pay and benefits must be determined. Employers are required to adhere to these rules and pay workers correctly,” said Cynthia Watson, Wage and Hour administrator in the Southwest. “Contractors know these obligations when they bid on government contracts, and when the contracts are awarded.”

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Gov. Cuomo signs new legislation making it easier for workers and the state Labor Department to fight wage theft

Posted by National Alliance for Fair Contracting on

NEW YORK DAILY NEWS / Sunday, January 4, 2015, 2:00 AM 

It feels good to be able to write about something positive for New York workers in my first column of 2015. After all, measures that benefit them and rein in abuses by their bosses are as rare as snow in August.

It took a long time but on Monday Gov. Cuomo gave a last-minute Christmas gift to hundreds of thousands of low-wage laborers across the state by signing legislation making it easier for workers and the state Department of Labor to fight wage theft, which in New York has been an epidemic for many years.

“I am tired of waiting,” said Marcos Lino, who filed a complaint with the Department of Labor in 2008 after enduring four years of being shortchanged by his boss in a small Flushing grocery store. Six years have passed and his case is still unresolved.

Hopefully now Lino – and thousands more who, like him, have waited far too long to recover what is rightfully theirs – will finally get some justice.

“The groundbreaking legislation signed today will protect both workers from abuse, and law-abiding businesses from being undercut by employers who turn a profit by breaking the law,” said Andrew Friedman, co-executive director of the Center for Popular Democracy.

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