Addressing a large, but rarely talked about problem, the Minnesota AFL-CIO announced today that it was partnering with lawmakers and workers on legislation to crack down on wage theft.
“Whether it’s an extra timecard used to deny overtime pay or paying below the minimum wage; wage theft is a problem for far too many workers,” said Minnesota AFL-CIO Secretary-Treasurer Steve Hunter. “It should be a universal value that people be paid the wages they earn, unfortunately some employers don’t see it that way.”
According to an Economic Policy Institute Report, wage theft costs American workers more than $30 billion dollars per year.
To put that into perspective, all of the robberies, burglaries, larcenies, and motor vehicle thefts in the nation cost their victims less than $14 billion in 2012, according to the FBI’s Uniform Crime Reports.
“When the home care agency I worked for closed in 2013, I was owed nearly $2,000 for hours that I had completed, money that I never have received,” said Robin Pikala, a home care worker from Minneapolis who is part of the newly formed SEIU Healthcare Minnesota Home Care Workers’ Union. “This was an incredible hardship for myself and the dozens of other workers who had to experience this, and no one should have to go through what we went through. I’m excited that legislators are proposing steps in hopes this doesn’t happen to anyone else in Minnesota.”
Centro de Trabajadores Unidos en la Lucha (CTUL) is a low-wage worker-led organization based in the Twin Cities. Over the past seven years CTUL has partnered with hundreds of workers to recover over $1.6 million in cases of wage theft. Two members of CTUL talked about their experiences with wage theft and the need to update the law.
Ruth Schulz, an organizer with CTUL said, “Kellermeyer Bergenson’s Services (KBS) is contracted to clean stores like Best Buy, TJ Maxx and others. In many cases KBS sub-contracts out the cleaning to smaller companies. In one year, 26 workers at five different KBS sub-contractors approached CTUL in 17 separate incidents with complaints of wage theft, adding up to over $17,000 in unpaid wages! Large stores like Best Buy and TJ Maxx pit dozens of cleaning companies against each other to get the lowest bid without considering the consequences to workers. The law should hold all of the companies that profit from wage theft accountable.”
The legislation, authored by Senator David Tomassoni and Representative Carly Melin:
- Increases penalties for wage theft from double to triple of the amount owed to the employee.
- Provides criminal penalties for employers who willfully or repeatedly violate this law.
- Ensures all wage theft complaints are confidential.
- Extends the statute of limitations on all wage theft to 6 years.
- Allows the state to revoke a business’ license for non-compliance or multiple abuses in paying back lost wages.
- Requires employers who violate this law to post a bond to prove they have the ability to pay wages.
- Provides for grants to community organizations to help educate workers about their rights and how to recoup lost wages.
- Creates a wage recovery fund as a contingency to ensure workers receive the wages owed to them.
- Protects workers from employer retaliation.
- At last brings Minnesota into federal conformity with the 40-hour workweek.