Employees' Pay Cut By Denied Overtime, Deductions For Equipment Thousands of Americans each year lose portions of their wages to wage theft. NPR's Arun Rath talks with Tia Koonse, of the UCLA Labor Center, about efforts to curtail the problem.

Employees' Pay Cut By Denied Overtime, Deductions For Equipment

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Last week LA workers and activists gathered at City Hall to address another labor issue - wage theft. City Council members want to revive a motion that would criminalize the practice of cheating workers of pay. Tia Koonse is with the UCLA Center. She says LA is the wage theft capital of the country.

TIA KOONSE: What we're talking about is really five heavy hitters - failure to pay minimum wage, failure to pay overtime rates of pay, off the clock violations - so requiring your employees to set up before they clock in as well as working through meal and rest breaks. And then illegal, mysterious or sometimes just blatant deduction from paychecks. For things that our state and federal labor laws require employers pay for. Like uniforms for example, or equipment such as a sewing machine or new needles.

RATH: A landmark study released in 2010 examined wage theft in three cities - Chicago, New York and Los Angeles. More than 4,000 workers were interviewed. Tia Koonse was one of the researchers.

KOONSE: And we found that 68 percent of those that we surveyed experienced a wage theft violation just in the previous week.

RATH: Wow.

KOONSE: Within those, each violation - a quarter of the workers experienced a minimum wage violation. 80 percent of workers who worked overtime hours weren't compensated at the overtime rate. 80 percent worked through their meal and rest breaks. All told about 15 percent, we estimate, of a worker's salary is lost to wage theft. And these are the lowest wage workers that we interviewed. So workers who make about $17,000 a year.

RATH: And how often are workers coming forward to report this sort of thing?

KOONSE: It's hard to determine. Certainly workers are afraid and one of the reasons why we think wage theft is so pervasive is the fear. We did interview workers about their experiences with retaliation. About one in five either reported to a government agency or complain to their boss. The majority of them experienced retaliation.

RATH: What does retaliation mean?

KOONSE: So retaliation under the law means threats to terminate you. Cutting your hours, giving you a worse shift, suspending you, demoting you. Those are the types of violations people experience when they try to take action to enforce their rights.

RATH: We are talking about lower wage workers. What industries in particular are we talking about?

KOONSE: So we certainly saw high violation rates in the garment industry for example. We also saw high violation rates in the carwash industry, retail, restaurant - other industries that were less predictable - like education for example. Folks who are undocumented are at higher risk. One of the things though I do like to emphasize is there's really no one face of wage theft. A third of the folks we interviewed are U.S.-born and only a third in fact are here without papers.

RATH: So how do you address it because obviously it's already against the law? What do you do?

KOONSE: Well a lot of different states have implemented a lot of measures in recent years. A lot of cities have adopted local ordinances. There's a couple ways to go at it. You can up the penalties to make it more expensive for employers to commit those types violations. You can address the issue that workers are not able to actually collect on the final judgments for unpaid wages that they've received. So my office conducted a study last year with the National Employment Law Project and we ascertained that only 17 percent of workers who go to our State's Labor Commissioner - which is the agency tasked with enforcing wage and hour laws here in California - ever collects a dime on their final judgments for unpaid wages.

RATH: So they've gone through the process. There's been a finding of wrongdoing.

KOONSE: That's correct.

RATH: The company or whatever has been ordered to pay the back wages and they just don't?

KOONSE: That's exactly correct. 60 percent of the employers with final judgments against them are no longer operating by the time that judgment comes down.

RATH: How much of this is a problem of both employers and employees just not knowing the rules, not knowing that say, you can't make an employee pay for their uniform things like that?

KOONSE: Sure that's something that we hear a lot. I can tell you that I know a lot of small businesses that would disagree with you. It took them a weekend to get up to speed on the code and they don't have a whole lot of sympathy for their competition who are able to offer better services and lower prices on the backs of their workers.

RATH: Tia Koonse is a legal and policy research manager at UCLA Labor Center. Tia thanks for coming in.

KOONSE: It was my pleasure.

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