Un­paid claims are per­va­sive in wage theft cases

Few work­ers bother to as­sert their rights. State says col­lec­tions show im­prove­ment.

Los Angeles Times - - BUSINESS - By Chris Kirkham and Tif­fany Hsu

Noe Flores had been cooking pork belly buns and duck tacos for more than a month in 2011 at the popular Fly­ing Pig food truck — of­ten log­ging 12-hour days, six days a week.

When he asked why he hadn’t re­ceived his first pay­check, Flores said, owner Joe Kim gave an odd an­swer: This part of the job was an un­paid ap­pren­tice­ship, last­ing up to two months.

Flores and three other em­ploy­ees filed a claim seek­ing back pay with the state, which or­dered Kim’s busi­ness to pay Flores more than $11,000. But nearly four years af­ter he left the Fly­ing Pig, he said, he’s re­ceived only a frac­tion of the to­tal — and the pay­ments have stopped.

Flores’ long strug­gle to re­cover lost wages points to a cru­cial short­com­ing in the state’s ef­forts to pro­tect lowwage em­ploy­ees, ex­perts and worker ad­vo­cates say. Even for work­ers who pre­vail against their em­ploy­ers in wage cases, few are able to col­lect what they are owed.

A 2013 UCLA La­bor Cen­ter study found that work­ers in Cal­i­for­nia col­lected only 42% of the back wages the state said they were owed from 2008 to 2011. Only 17% of work­ers who ob­tained a judg­ment against their em­ployer saw any money at all dur­ing the three-year pe­riod, the re­port found.

The state’s own in­ves­ti­ga­tors had a sim­i­lar col­lec­tion rate of 20%, ac­cord­ing to the most re­cent re­port from the Cal­i­for­nia La­bor Com­mis­sioner’s Bureau of Field En­force­ment.

Part of the chal­lenge is time: Wage claims can take years to re­solve. In that time, work­ers can lose in­ter-

est and com­pa­nies can change names, mak­ing the col­lec­tion process more com­pli­cated, ac­cord­ing to la­bor lawyers.

As many as 60% of wage cases in Cal­i­for­nia in­volve sce­nar­ios in which a busi­ness en­tity has switched own­er­ship or changed names, said Matthew Sirolly, direc­tor of the Wage Jus­tice Cen­ter, an L.A. non­profit group that has been work­ing with state agen­cies to tar­get un­paid claims.

“The new cor­po­ra­tion isn’t re­spon­si­ble for the old cor­po­ra­tion’s debts,” Sirolly said. “It’s like try­ing to col­lect from the Tooth Fairy.”

The poor re­sults and de­lays can cause work­ers to lose heart.

A 2010 re­search sur­vey of low-wage work­ers in Los An­ge­les County found that nearly 30% re­ported be­ing paid be­low the min­i­mum wage in the pre­vi­ous week. The poll sam­ple rep­re­sented more than 744,000 low-wage work­ers. But last year, only about 5,000 filed claims with the county’s branch of the state La­bor Com­mis­sioner’s of­fice.

“They know they’re not go­ing to get any­thing,” said Tia Koonse, legal and pol­icy re­search manager with the UCLA Down­town La­bor Cen­ter. Rogue em­ploy­ers know the same thing — that they’ll prob­a­bly never have to pay, she said.

In the Fly­ing Pig case, 13 work­ers ini­tially al­leged they were un­der­paid. Only four de­cided to pur­sue a for­mal wage case, and just two of those four have re­ceived what they are owed, state doc­u­ments show.

Flores, the cook, got a judg­ment for more than $11,000 last year, but doc­u­ments from his at­tor­neys show the pay­ments ended in July — to­tal­ing just $4,100. His case has been for­warded to the Wage Jus­tice Cen­ter, which works with the state on un­col­lected claims.

Fly­ing Pig owner Joe Kim, who now runs an op­er­a­tion at the Fi­gat7th food court in down­town Los An­ge­les, did not re­spond to calls seek­ing com­ment.

Cal­i­for­nia La­bor Com­mis­sioner Julie Su said the state has sig­nif­i­cantly im­proved its col­lec­tion rate on back wages in re­cent years by im­prov­ing the in­ves­ti­ga­tion process and crack­ing down on em­ploy­ers who re­tal­i­ate af­ter work­ers re­port prob­lems.

In the past, Su said, the state of­ten con­ducted ran­dom sweeps of busi­nesses, which proved in­ef­fec­tive. Now in­ves­ti­ga­tors do sur­veil­lance and study data to bet­ter pre­pare for cases.

“When my deputies go in, they have as much in­for­ma­tion as pos­si­ble,” Su said.

The agency has also worked to elim­i­nate on-site in­ter­views in which work­ers were ques­tioned as their bosses watched.

In the 2000s, Su said, 47% of probes re­sulted in the find­ing of a vi­o­la­tion; that num­ber is now nearly 80%.

By part­ner­ing with the Wage Jus­tice Cen­ter, the state is also ex­plor­ing new legal ap­proaches, such as su­ing busi­nesses that fraud­u­lently trans­fer as­sets to shell cor­po­ra­tions to avoid legal judg­ments.

Ad­vo­cates also have sug­gested the state ex­plore the idea of a “wage lien” — a legal hold that would be at­tached to the busi­ness’ prop­erty. State law al­ready gives work­ers in the con­struc­tion in­dus­try the abil­ity to place “me­chan­ics liens” on on­go­ing con­struc­tion projects if they aren’t paid.

An­gel Tellez, a day la­borer who worked for four weeks on a down­town ho­tel project in 2013, was ini­tially paid only $200 by a sub­con­trac­tor. The Wage Jus­tice Cen­ter helped him file for a lien, and later he said he had re­ceived $4,500.

Ul­ti­mately, ex­perts said, no amount of gov­ern­ment en­force­ment can ever keep up with the prob­lem of un­paid wages. The real chal­lenge, they said, is rais­ing worker aware­ness.

Agen­cies can do only so many sting op­er­a­tions and in­ves­ti­ga­tions into em­ploy­ers, said UCLA’s Koonse. “Work­ers are go­ing to have to do this on their own — to or­ga­nize and get in­formed,” she said.

Bar­bara David­son Los An­ge­les Times

NOE FLORES , left, and Ara Kim filed claims for un­paid wages at Fly­ing Pig. Flores re­ceived only about 40% af­ter he won his case. In many wage cases in Cal­i­for­nia, busi­nesses switch own­er­ship or change names.

Lawrence K. Ho Los An­ge­les Times

FLY­ING PIG , above at Fi­gat7th in Los An­ge­les, failed to pay most of a legal judg­ment for back wages to­tal­ing more than $11,000, doc­u­ments show.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.