WORKING POOR-My hairdresser requests payment in cash, and I know she may be avoiding the IRS or trying to hide her gross income for some other reason. I pay her what she charges plus a little extra for a tip. But it turns out that many LA workers paid in cash are cheated out of the wages they earn – an estimated 35 percent are paid below the minimum wage, 90 percent denied overtime pay and 80 percent are not paid for legally required meal breaks.
These are not primarily workers who, like my hairdresser, provide personal services to individuals, but those who work for large companies employing 100 employees or more. Pay below the required minimum wage is received by 58 percent of garment workers, 30 percent of retail workers and 17 percent of residential construction workers. In other words, wage theft is practiced across major, thriving industries in our city.
These startling figures were shared at a recent Economic Sustainability Roundtable sponsored by the Los Angeles Alliance for a New Economy, the UCLA Labor Center, the research nonprofit Economic Roundtable and UCLA’s Institute for Labor Research and Education. Attended by 40 researchers and nonprofit staffers, the goal of the Roundtable, according to convener Dan Flaming, is to build a collaborative effort by people “who care about research-based evidence that can inform the development of public policy to improve conditions for LA’s working poor.”
What is commonly experienced by our city’s low-wage workforce is its members’ lack of legal recourse to redress violations of their rights. This can be a result of their undocumented status, being paid under the table or “off the books.”
It can also stem from the misclassification of their jobs as outside contractors and not employees, or from employment in positions not legally recognized – such as street vending. Of those workers who have the courage to file complaints for their mistreatment, 83 percent never receive the lost pay. In most cases their former employers are no longer in business when the charges are investigated.
Through 1999 this “informal,” largely unregulated economy made up an estimated 13 percent of jobs in LA County. By 2000 it represented about 20 percent of local employment, adding to economic inequality and resulting pressures in the regional economy. More than 550,000 of these workers are in restaurant and personal services; 380,000 are in other industries.
One of the largest pools of underpaid and misclassified workers toil in the region’s “goods movement” industry. Five hundred thousand workers in LA, San Bernardino and Riverside counties pick up, transport, sort and distribute goods that arrive at the Ports of Los Angeles and Long Beach and are taken to regional warehouses. They often do work for some of the world’s largest corporations but earn below the minimum wage.
Numerous legal challenges to their non-employee status, claims for hundreds of thousands of dollars in back pay and worker strikes have recently led to the reclassification of truck drivers at a major port trucking company. As company employees they will be covered by a living wage, workers compensation and other laws protecting their health and wages, and will legally have the right to unionize.
This monumental change and many others are aided by good, solid research about existing conditions, combined with the leadership of those employees suffering economic abuse. The Economic Sustainability Roundtable aims to provide and share the critical research needed to move our city forward towards reform.
(Vivian Rothstein is a development consultant for the Los Angeles Alliance for a New Economy. She has a long history as a community organizer, beginning with her work in the Mississippi Freedom Summer project of 1965. This piece was posted first at Capital and Main)
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CityWatch
Vol 13 Issue 7
Pub: Jan 23, 2015
