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Survey: Wage Theft Rampant in Twin Cities

Nicole Knight

In a report, 82 percent of low-wage workers in the Minneapolis/St. Paul area of Minnesota said they have to work at least two jobs to make ends meet. Sixty-four percent reported they worked when sick because they were denied paid time off.

Low-wage workers in the Twin Cities earn wages that put them below the poverty line and nearly half have been subject to wage theft, according to a new labor survey.

The report, released November 13 by Centro de Trabajadores Unidos en Lucha, a Minneapolis-based workers center, found respondents make an average of $10.34 per hour, with 82 percent saying they have to work at least two jobs to make ends meet. Sixty-four percent reported they worked when sick because they were denied paid time off.

The results were drawn from 173 surveys completed by workers in hotels, restaurants, manufacturing, construction, janitorial services, and other industries in the Twin Cities, the Minneapolis/St. Paul area of Minnesota.

Nationwide, thousands of low-wage workers have organized in the #FightFor15 movement to demand fair treatment under the law and a hike in the $7.25 federal minimum wage, which hasn’t budged since 2009. Forty-two percent of U.S. workers earn less than $15 an hour, a report by the National Employment Law Project found, and more than half of those workers are women.

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Terin Mayer, lead organizer of the Workplace Rights Defenders Program at Centro de Trabajadores Unidos en Lucha said the labor survey documents a “failure of the existing enforcement system.” Mayer said the organization is calling for reforms, including a city law to withhold the business license of employers that repeatedly violate labor laws.

Business groups in October blocked a push by some local lawmakers for a “working families agenda” to require employers to set employee work schedules four weeks in advance and pay workers if those schedule times are changed, according to reports. The agenda included rules to require all businesses to offer workers paid sick leave.

Mayer said unpredictable scheduling disrupts workers’ lives, and labor groups would continue to advocate for reforms.

The Twin Cities study documents cases of labor violations, such as wage theft. Cecilia Guzman, a commercial cleaner, described how she was fired after complaining that her employer owed her $4,570 in unpaid wages. The report estimates that wage theft costs the average worker $2,634 out of $17,616 in total average annual earnings.

Mayer said that low-paid workers, unaware of labor protections or fearing reprisal, often don’t demand their legal rights. His group is calling for greater worker education on labor laws and stronger enforcement.

“You’re not going to see actual enforcement of wage and employment laws if there’s a culture of violence and threats,” Mayer said.

Increasingly, employers like Amazon and McDonald’s have been slapped with class action lawsuits claiming wage theft. Papa John’s has been found guilty of violating wage theft laws in New York. Owners of Papa John’s franchises have refused to pay employees minimum wage and overtime.

The Department of Labor under President Obama has made strides in bolstering labor and employment law, including a recent ruling by the National Labor Relations Board that could hold corporate parents like Papa John’s responsible for the unlawful employment actions of franchise owners.

Lawmakers in several states, including Democrats in Wisconsin, have proposed laws that would crack down on employers who commit wage theft against their employees. Business groups nationwide oppose the effort to penalize companies and corporations that don’t pay employees for the work they do, decrying wage theft laws as harmful economic policies.

A study of 2008 data released by the National Employment Law Project, the UCLA Institute for Research on Labor and Employment, and the Center on Urban Economic Development found that of workers in low-wage industries in Chicago, Los Angeles, and New York City, 26 percent were paid less than the legally required minimum wage, and three out of four employees who worked more than 40 hours a week were not legally compensated for their overtime hours.

Six in ten low-wage industry workers were underpaid by more than $1 per hour.

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