City Council Looks to Bust Businesses That Steal Wages

“Los Angeles is really the wage-theft capital of the country,” said Tia Koonse of the UCLA Labor Center. “Workers are simply afraid to come forward.”

The L.A. City Council hopes to change that with a new city ordinance to crack down on businesses that cheat employees of their pay. The goal is twofold — to ensure that workers are being paid the right wage for all their labors, and to maintain a fair competitive arena for all businesses. Employers who cheat their workers simultaneously provide themselves with more resources to compete.

Wage theft occurs in several ways, from failing to pay minimum wages or overtime, forcing workers to miss the breaks to which they are entitled by labor law and illegally deducting workplace costs, such as uniforms, from their paychecks. A UCLA study four years ago concluded that a huge majority of low-wage workers in Los Angeles County, far more than in New York or Chicago, had experienced some form of wage theft.

The details of the new ordinance haven’t been determined, but among ideas under consideration are punishing businesses that steal from employees by revoking licenses or permits, establishing a local agency to investigate theft claims and ramping up protections for workers who report such violations.

Other cities have passed similar laws, including Chicago and Seattle.

Laws against stiffing workers exist now, but the process to make and pursue claims with the state labor commissioner is slow and often ineffective. Last year, the UCLA Labor Center and the National Employment Law Project found that 83% of California workers who won state judgments were unable to recover their lost wages, often because the guilty business had closed.

One of them was Felipe Villarreal, who won his claim but said he was owed $67,000 from a former job at an L.A. car wash that has since closed.

Another was Axel Paredes, a handyman who said he had been promised $9 an hour but was paid only $5 or $6 hourly.

Read the whole story in the Los Angeles Times.