On Wednesday March 4th, 2009, a group organized by Richard Iannuzzi of the New York City United Teachers Union and local city Bishop, Howard Hubert, sought to raise awareness about the growing problem of wage theft in the city. This unfortunate and unethical practice involves the exploitation of wage level laborers. For instance, a boss or shift manager at a coffee shop may “take” (steal) money from the tip jar, thereby depriving baristas of their weekly tips. Or a shop owner may – illegally – categorize a full-time worker as a freelance worker or independent contractor to get out of paying benefits.
At this media conference, Iannuzzi discussed how significant a problem wage theft has become in America–and it’s a particularly pernicious one during the current down economy. Some studies suggest that 10 million US workers may already have been victims of wage theft. And regulators seem to be doing less and less about it!
Consider that, last July, the Government Accounting Office came down hard against the Wage and Hour Division of the Labor Department for being lax in enforcing violations of Wage Theft Law. For instance, a decade ago, the Labor Department was on average pursuing nearly 50,000 violations. By 2007, that number had dropped to under 30,000. Punitive tactics–to prevent recidivism among offending employers–have also been watered down significantly. And the GAO estimates that, over the past decade, hundreds if not thousands of wage theft cases have gone unresolved due to bureaucratic incompetence or improper handling.
New York boasts a Wage Watch Program which goes to bat on behalf of around 17,000 jilted New York employees every year. But programs like this notwithstanding, the issue will likely remain at the forefront of the American consciousness for some time.
Consider that, in
the 1940s, the ratio of federal wage investigators to workers was more than
1,000% of today’s ratio of investigators to workers. A disturbing trend, indeed!