A couple of weeks ago, a team of researchers released a report, "Broken Laws, Unprotected Workers", which found an astounding level of labor law violations among low-wage workers (rrepresenting the bottom 15%), costing workers thousands of dollars a year. It was based on a survey of thousands of low-wage workers in Los Angeles, Chicago and New York City, but the pattern of labor law violations is certainly much more widespread, though it's impossible to tell how severe it may be elsewhere. Naturally the wage theft involved impacts entire communities--including the business located there--a much broader impact than just the individual workers who are directly affected.
Topline findings-listed at the Center on Politicy Initiatives website where the report is available-include the following:
Workplace violations are severe and widespread in the low-wage labor market. In our sample, 26% of low-wage workers were paid less than the minimum wage in the week prior to the survey, and 76% of those who worked more than 40 hours were not paid the legally required overtime rate.
Job and employer characteristics are key to understanding workplace violations. For example, the industry and occupation of a worker's job was one of the strongest predictors of violations.
All workers - regardless of legal status, race, gender and nativity - are at risk of workplace violations, though some groups are more vulnerable than others.
More than two-thirds of our sample experienced at least one pay-related violation in the previous work week. Assuming a full-time, full-year work schedule, we estimate that workers lose an average of $2,634 annually due to workplace violations, out of total earnings of $17,616.
I interviewed one of the co-authors. Ruith Milkman, for a story based on the report that I'm writing for Random Lengths New. I plan to republish the story after it runs, but I didn't want to wait to share some of the information in the report, and some of what thoughts it stirred.
First and foremost, it served to reinforce what I learned as a child from my grandparents and great aunts and uncles, about the sort of world that had existed before modern labor laws were put into place as part of the New Deal. To a shocking degree, this report reveals, that lawless world has returned all around us, without being noticed. The shock of that realization is a call to do something about it-not just something immediate, but something deep and sustained.
"The danger with this is, this is a new enough phenomena that people are horrified when they hear about it," Milkman told me. "But the real danger is that it becomes a part of the economic landscape," she said. "Now the question is what are we going to do about it?"
There is a real danger that it could become something that we simply accept, she warned And here Milkman drew an analogy to the emergence of mass homelessness in the early Reagan era. "When it first started, there was a lot of distress and intense discussion and debate about it, and now we take it for granted. It's like we live in India."
All the quoted text here comes from the executive summary.
Finding 1: Workplace Violations Are Severe and Widespread in Low-Wage Labor Markets
We found that many employment and labor laws are regularly and systematically violated, impacting a significant part of the low-wage labor force in the nation's largest cities. The framework of worker protections that was established over the last 75 years is not working. Here we summarize only key violations; Table 3.1 lists all the violations measured in our study.
Minimum wage violations:
Fully 26 percent of workers in our sample were paid less than the legally required minimum wage in the previous work week.*
These minimum wage violations were not trivial in magnitude: 60 percent of workers were underpaid by more than $1 per hour.
The report also looks at the impacts of different sorts of pay arrangements:
And the characteristics of the workers:
Overtime violations were also very widespread:
Overtime violations:
Over a quarter of our respondents worked more than 40 hours during the previous week. Of those, 76 percent were not paid the legally required overtime rate by their employers.
Like minimum wage violations, overtime violations were of substantial magnitude. The average worker with a violation had put in 11 hours of overtime-hours that were either underpaid or not paid at all.
Four other kinds of pay violations were also tracked:
"Off-the-clock" violations:
Nearly a quarter of the workers in our sample came in early and/or stayed late after their shift during the previous work week. Of these workers, 70 percent did not receive any pay at all for the work they performed outside of their regular shift.
Meal break violations:
The large majority of our respondents (86 percent) worked enough consecutive hours to be legally entitled to at least one meal break during the previous week. Of these workers, more than two-thirds (69 percent) received no break at all, had their break shortened, were interrupted by their employer, or worked during the break-all of which constitute a violation of meal break law.
Pay stub violations and illegal deductions:
In California, Illinois and New York, workers are required to receive documentation of their earnings and deductions, regardless of whether they are paid in cash or by check. However, 57 percent of workers in our sample did not receive this mandatory documentation in the previous work week.
Employers are generally not permitted to take deductions from a worker's pay for damage or loss, work-related tools or materials or transportation. But 41 percent of respondents who reported deductions from their pay in the previous work week were subjected to these types of illegal deductions.
Tipped job violations:
Of the tipped workers in our sample, 30 percent were not paid the tipped worker minimum wage (which in Illinois and New York is lower than the regular state minimum wage).
In addition, 12 percent of tipped workers experienced tip stealing by their employer or supervisor, which is illegal.
Next, the crucially important issue of employer retaliation:
Illegal employer retaliation:
We found that when workers complained about their working conditions or tried to organize a union, employers often responded by retaliating against them. Just as important, many workers never made complaints in the first place, often because they feared retaliation by their employer.
One in five workers in our sample reported that they had made a complaint to their employer or attempted to form a union in the last year. Of those, 43 percent experienced one or more forms of illegal retaliation from their employer or supervisor. For example, employers fired or suspended workers, threatened to call immigration authorities, or threatened to cut workers' hours or pay.
Another 20 percent of workers reported that they did not make a complaint to their employer during the past 12 months, even though they had experienced a serious problem such as dangerous working conditions or not being paid the minimum wage. Half were afraid of losing their job, 10 percent were afraid they would have their hours or wages cut, and 36 percent thought it would not make a difference.
Further widespread problems:
Workers' compensation violations: We found that the workers' compensation system is not functioning for workers in the low-wage labor market.
Of the workers in our sample who experienced a serious injury on the job, only 8 percent filed a workers' compensation claim.
When workers told their employer about the injury, 50 percent experienced an illegal employer reaction-including firing the worker, calling immigration authorities, or instructing the worker not to file for workers' compensation.
About half of workers injured on the job had to pay their bills out-of-pocket (33 percent) or use
their health insurance to cover the expenses (22 percent). Workers' compensation insurance paid
medical expenses for only 6 percent of the injured workers in our sample.
When workers are exempt from workplace laws:
Some workers are either partially or completely exempt from employment and labor laws-either because of archaic exemptions of specific industries and occupations, or because they are considered to be independent contractors.
We surveyed one group of workers that is often considered exempt from coverage: "in-home" child care workers who provide care in their own homes. When we analyzed their working conditions (separately from the rest of the sample), we found that 89 percent earned less than the minimum wage. This finding underscores the need to ensure that all workers who are in an employment relationship receive full legal protection.
Finally, here's a summary table of all the violations tracked:
This is one of those studies that rightly ought to cause an seismic shift in the political landscape. It's evidence of decades-long crime spree. But nothing is automatic-certainly not in this day and age. And so whether or not there will be any change--much less the kind of dramatic change it would take to end this lawlessness-is going to be up to people like us.
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