Leigh Anne Schriever
Jan. 23, 2019
For more than 80 years, the Fair Labor Standards Act (FLSA) has provided essential legal protections like minimum wage and overtime laws for workers in the United States. And yet, employers flagrantly violate the FLSA’s wage protections throughout the country.
A recent report by Philip Mattera and Adam Shah demonstrates that all kinds of employers violate federal laws and regulations governing wage standards. Small companies may have difficulty understanding the laws and may not understand what compliance with the laws entail. But Mattera and Shah point out that large companies—from Walmart to Microsoft—are often the culprits, despite the fact that they have legal teams and plenty of resources. For example, Mattera and Shah identified 1,200 successful actions, each with multiple workers involved, against large companies since 2000. In total, these employers paid more than $8.8 billion to the workers they had shortchanged.
Of course, many employees will not risk losing their jobd by reporting this. I have been in this position.
Wage theft—including overtime violations, forcing workers to labor off-the-clock, misclassifying workers as independent contractors, and stealing tips from tipped workers—has been a significant problem for low-wage workers for a long time, including for those who work at large companies. Most of these violations happen primarily to low-wage workers who have hourly rates and may not know their rights. Also, wage theft disproportionately impacts women and people of color. Experts have estimated that as much as $50 billion a year is stolen from workers, much of which workers never report or recover. For instance, one report stated that workers only recovered roughly $1 billion each year in 2015 and 2016.
Mattera and Shah’s report demonstrates that many companies treat wage theft as part of their business model. Wage laws can be complicated, and small businesses may run low on money from time to time. But Mattera and Shah argue that large firms with millions of dollars of profit and in-house legal staff presumably understand the laws and can follow them. Mattera and Shah found, for instance, that several of the largest companies with verdicts or settlements against them for wage violations were repeat players: Some of these companies had over 50 cases against them, and one company had over 150 since 2000. As Mattera and Shah put it, “Wage theft may have been part of their business model, but it does not need to be—and should not be.”
•••••
Low-wage workers, who are the most likely to be exploited, have always had a hard time using private litigation, such as the cases that Mattera and Shah analyzed, because they often cannot afford the time off of work that it would require nor can they often raise the money to hire an attorney. Government enforcement instead of private litigation is even more important, however, now that the U.S. Supreme Court has ruled that workers can be made to sign class-action waivers and mandatory arbitration clauses, which will make it more difficult for workers to bring these claims by themselves.
For state governments in particular, Mattera and Shah recommend enacting legislation similar to California’s. California has both enacted stronger wage and hour protections, such as higher minimum wages and meal and rest breaks, and created a mechanism for individuals to bring enforcement actions on behalf of the state attorney general. The California Private Attorney General Act allows individuals to circumvent the mandatory arbitration and class action waiver clauses in contracts and bring suit against employers, while also allowing the state to collect civil penalties.
Mattera and Shah also advocate for workers organizing as another critical method for combatting wage theft.
•••••
No comments:
Post a Comment