by Tom Magnarelli
Local and state labor groups rallied in the Village of Liverpool outside of Syracuse Tuesday for a $15 an hour minimum wage in upstate New York. The state approved an increase to the minimum wage earlier this year that will bump it up to $12.50 an hour in upstate in five years. Gov. Andrew Cuomo said he eventually wants upstate to reach $15 an hour.
But included in the plan is a break to examine if the upstate economy can sustain the increase. Joe Paparone, with the New York State Labor-Religion Coalition, said while the fight for $15 movement has been going on for years, it will not go away just because legislation passed this year.
“Upstate did not get $15 an hour and won’t have $15 an hour, maybe ever at this point according to the legislation,” Paparone said. “We’re going to keep coming out here because people don’t have enough money to eat, they don’t have enough money to pay for reasonable housing and they’re struggling and they’re working hard. That’s the other thing people seem to forget, that these are workers.”
Activists came from across the state to share their support. Angela Warner runs the food pantry at the St. Vincent de Paul Church in Albany. While Warner said the food pantry is unfortunately a growing business, she wants to focus on ways to reduce the numbers of those who need it.
"The only way that our parish can do that is by addressing the underlying issues that lead to poverty which is hunger and low wages," Warner said. "We have made a commitment in our church to support issues that will raise our food pantry guests' wages so they can support themselves and their families."
The labor groups, which also included the Workers Center of Central New York and the Central New York Area Labor Federation, AFL-CIO, called for an end to wage theft and the right for farm workers to organize.
Read more from WRVO.
by Cindy Brandt
It’s a fairly common tendency among adults to remember our adolescent years as the time when we thought we had life all figured out, and chuckle at our youthful arrogance. But former evangelical teens like me possessed another level of audacity in our youth — not only were we armed with our own answers for all of life’s big questions, we also had answers for everyone else.
In all of the world.
Many of us who grew up attending short term mission trips with our high school youth group look back on those memories with a particular mixture of horror and endearment. We would bake the heck out of all the cookies and wash all the cars to raise funds so we could go and ensure that all over the world, people knew our answers to their life’s problems. And the stories we’d marinate while on our trip —embellished with details like how gross the bathroom conditions were in this or that third world country and the volume of exotic foods we consumed — were designed to best the previous year’s short term missions trip’s “sharing.”
It was at once a ridiculous display of privilege and a treasure trove of dear memories with our peers.
In recent years, short term missions (STMs) has come under some scrutiny. Popular blogger Jamie the Very Worst Missionary opened what she called a can of worms on some problematic aspects of STMs — like centering on the stories of the rich kids who go on these trips, instead of the locals. And the bestselling book When Helping Hurts, by Brian Fikkert and Steve Corbett, critiques the financial stewardship of the Western church’s resources, highlighting astounding statistics like this one: In 2006, Americans spent $1,600,000,000 on STMs. Other problems inherent in STMs include a lack of quality cross-cultural training and an abuse of power dynamics, things Westerners are often unaware of when stepping across foreign boundaries. Thoughtful engagement of STMs consider what it means to do good development and how that intersects with evangelism's goals.
We're long overdue some criticism of short term missions and a long, hard look at the colonial roots of long term missions. There is much that the church, particularly the Western church, has to repent of when it comes to harm and damage done in the name of glorifying the Lord in all nations. As a new generation of youth rise up in the church, we must lead them to do better.
And yet, I fear that as we strip away the baggage of STMs, we may also rob our youth of the life-giving spirit of service, compassion, and community. Once we get past the embarrassment of the errors of our past, a powerful narrative of strength in teamwork, and participation of something greater than ourselves, remains. I believe this is a crucial element of adolescent development, as teenagers embark on the road to outgrowing their childhood egotism.
“Missions” has a much broader definition outside the evangelical context. The concept of banding with a team of people and embarking on an adventure to achieve a worthy cause is the driving story behind all of the world’s epic tales. A deep sense of mission is an essential driving force that carry us from moving through each stage of living a meaningful life.
How can the Christian youth of today band together with non-Christian youth in a way that fuels their dreams and taps into the vibrant energy coming of age?
I want to suggest the idea of protest as mission. I propose this idea not from my own jaded adult mind, but from following the lead and tremendous example of young voices in this generation.
In a historic lawsuit, 21 young plaintiffs — nicknamed the “climate kids” — are suing President Obama and the United States government for not doing enough to stop the rapidly changing climate. Children as young as eight-and-a-half are speaking up for their own generation, while the actions of adults are causing consequences for the earth they have to inherit.
And in protest of the Dakota Access Pipeline,which would snake through the sacred lands of the Standing Rock Sioux Tribe and threaten their water supply, young Native Americans are standing up for their own community.
“It’s a time of unification. It’s to be with my brothers and sisters and my youth to stand as one and fight or this land,” Naelyn Pike, from the Chiricahua Apache Tribe, said.
In these brave protests, I see echoes of the same sentiment that fueled my own young evangelical dream — to be in community with my people, and together make a change in the world. Historically, children have been involved in protests, says Kenneth Braswell,author of the illustrated children’s book, Daddy, There’s a Noise Outside. Our youth have a right to learn and understand the issues facing our community, both local and global, and they deserve to insert their voice into the spaces they occupy. This is as sacred and spiritual a mission as short term missions.
Read more from Sojourners.
by Steve Strunsky
Cheese sandwiches in hand, school food services workers from several Essex County districts marched to the office of the state-appointed Essex County superintendent of schools to make their case for better pay.
The sandwiches consisted of two slices of bread and a single slice of American cheese, which is what the workers said they are told to give students who have no money for whatever regular school lunch is being served that day.
Employees of school food service contractors are one of the most recent groups of low-wage workers to seek raises to $15 an hour. The point of the sandwiches, according to the union official who led the workers up to the superintendent's office, was to underscore the meager funding allocated for school lunch programs, which in turn limits the wages for food and workers' wages. Typically, union officials said, the cafeteria workers make $9 to $14 an hour.
Essex Superintendent Joseph Zarra was not in his office at the time, so one of the workers delivered the the message to his assistant.
"This cheese sandwich is not a nutritious meal," said the worker, Leslie Williams, 58, who lives and works in Orange. "And that's the way this food service works. We can't even afford to buy our family a cheese sandwich."
The union official, SEIU Local 32BJ Vice President Kevin Brown, said negotiations are ongoing for a master contract with a food service company, Chartwells Higher Education Food Services of Port Chester, N.Y., The company supplies school lunches and labor for the Orange, Hackensack, North Brunswick, South Brunswick, and Woodbridge districts.
The union has also campaigned for a $15-an-hour wage for cabin cleaners, baggage handlers and security guards at Newark Liberty International Airport. Like cafeteria workers who used to be employed directly by their school districts, many low-paid airport workers now work for contractors following a wave of outsourcing by the airline industry.
Last week, the Port Authority of New York and New Jersey, which runs the airport, decided not to impose a $15-an-hour minimum wage requirement on firms doing business at the airport. The agency had already imposed a minimum of $10.10 an hour for airport workers, above the state minimum wage of $8.38.
Last month, Gov. Chris Christie vetoed a Democratic bill that would have gradually raised the state's hourly minimum to $15.
Brown said the five districts are far from alone in outsourcing food services, and that 70 percent of New Jersey's 10,000 K-12 food service workers are employed by private contractors, a privatization trend that dates back decades that continues as districts look to save money in times of stagnant or declining state aid.
Chartwells did not return a request for comment on Tuesday. Last month, a regional vice president of the company, Gene Sanchez, told NJ Advance Media that Chartwells had reached agreements with the SEIU for 16 years, and remained committed to "a collaborative and productive process" during the current round of negotiations.
"The contractors aren't paid enough by the school districts to pay their workers, thanks to the lack of school funding," Brown said.
Zarra, who works for the state Department of Education, did not respond to a message left at his office on Tuesday. A spokesman for the department declined to comment on the local contract talks.
Read more from NJ.com.
From KUTV CBS 2:
by Matt Gephardt and Cindy St. Clair
Bonnie Bourgeous is a science teacher. It's a passion that, in 2014, landed her a position at a newly founded public charter school, the Utah Military Academy.
It was a new school that didn’t have any science equipment so, Bourgeous says, she got permission to purchase science supplies with the promise that she would be reimbursed. But only a fraction of the $3700 worth of equipment and supplies she purchased was paid back, she claims.
Worse, Bourgeous says the school also withheld money she was promised from coaching and writing grants.
Bourgeous says the ongoing pay disputes prompted her to quit after just one quarter of work – though that led to another dispute. Bourgeous says she was shorted on her final paycheck about $4,300.
"It is in my contract that I have earned that money," she said.
When the school refused to pay, Bourgeous turned to the state of Utah for help, filing a complaint with the Utah Labor Commission. Bourgeous says she couldn't believe it when the commission refused to help because of where she had worked.
"Basically they said that as a Utah public charter school, they are a state entity, that I could not file with the state labor commission."
Having trouble believing that state employees are exempt from state protection, Bourgeous decided to Get Gephardt.
"But believe it," said Alison Adams-Perlac, Director of Utah Antidiscrimination & Labor Division at the labor commission. Adams-Perlac says they are eager to investigate all claims that come into their office but, like they told Bourgeous, they are forbidden from helping her.
“Right now it's really up to the legislature and they've made it very clear that the Wage Claims Act does not apply to public entities,” said Adams-Perlac.
In fact, Utah's Wage Claim Act carves out all sorts of protections for workers, then takes all those protections away for state employees. The enrolled law reads, “None of the provisions of this chapter shall apply to the state."
"It prevents us taking any action on claims that are filed against a public entity and there's also a statute that says a public charter school is a public entity," Adams-Perlac said.
Adams-Perlac says if Bourgeous wants help, she can try her luck with the feds -- the US Department of Labor -- or she can file a lawsuit.
For its part, the Utah Military Academy says it doesn't owe Bourgeous anything. In a statement from the school's lawyer which, because they are a public entity, is the Utah state Attorney General, said the academy is square on all wages owed.
Read more from: KUTV CBS 2.
From The New York Times:
by Stacy Cowley
At least 5,300 Wells Fargo employees have been fired for ethics violations like setting up illicit accounts without customers’ knowledge to meet sales targets. Now there’s another group of aggrieved Wells Fargo workers: people who say they were fired or demoted for staying honest and falling short of sales goals they say were unrealistic.
That second group of workers, who claim that they played by the rules and were punished for it, are starting to coalesce around two lawsuits that were just filed and that seek class-action status. The first was filed in Los Angeles last week by former Wells Fargo workers who say that while their colleagues created unauthorized accounts to meet cross-selling quotas, they were penalized or terminated for refusing to do the same. The bank’s chief executive, John Stumpf, has often stated his goal that each Wells customer should have at least eight accounts with the company. That aggressive target has made the bank’s stock a darling on Wall Street, the lawsuit notes.
On Monday, a federal lawsuit with analogous claims was filed in the United States District Court for the Central District of California, seeking to create a class of current and former Wells employees across the country who had similar experiences.
“These are the people who have been left holding the bag,” said Jonathan Delshad, the lawyer representing the workers in both suits. “It was a revolving door. If you weren’t willing to engage in these types of illegal practices, they just booted you out the door and replaced you.”
In a statement on Monday, Wells Fargo said: “We disagree with the allegations in the complaint and will vigorously defend against the misrepresentations it contains about Wells Fargo and all of the Wells Fargo team members whose careers have been built on doing the right thing by our customers every day.”
One former employee planning to join the lawsuit is Dennis Russell, 62, who said he was fired in 2010 after a five-year career as a telephone banker at Wells Fargo’s call center in Orange County, Calif. Mr. Russell handled incoming customer service calls and was expected to refer 23 percent of his callers to a sales representative for additional product sales, he said.
But the customers Mr. Russell spoke with were usually in dire financial shape, he said in a telephone interview on Monday. Looking at their accounts, he could see mortgages in foreclosure, credit cards in collections and cars being repossessed for overdue loan payments.
“The people calling didn’t have assets to speak of,” Mr. Russell said. “What products could you possibly offer them in a legitimate way?”
The two fresh lawsuits echo many of the allegations in a 2015 lawsuit filed by the Los Angeles city attorney’s office. Wells Fargo settled the case this month, agreeing to pay $185 million in fines, including a $100 million penalty levied by the Consumer Financial Protection Bureau, the federal watchdog agency that conducted its own investigation.
But some Wells Fargo employees tried, years earlier, to sound the alarm — with personally disastrous results.
Yesenia Guitron, a former banker, sued Wells Fargo in 2010 — three years earlier than the bank has admitted it knew about the sham accounts. Ms. Guitron became alarmed when, two months into her job at Wells Fargo, she noticed that a fellow banker at the company’s St. Helena, Calif., branch was opening and closing customers’ accounts without their permission.
Intense sales pressure and unrealistic quotas drove employees to falsify documents and game the system to meet their sales goals, she wrote in her legal filing.
Ms. Guitron said she did everything the company had taught employees to do to report such misconduct internally. She told her manager about her concerns. She called Wells Fargo’s ethics hotline. When those steps yielded no results, she went up the chain, contacting a human resources representative and the bank’s regional manager.
Wells Fargo’s response? After months of what Ms. Guitron described as retaliatory harassment, she was called into a meeting and told she was being fired for insubordination.
In 2012, the United States District Court for the Northern District of California sided with Wells Fargo and ruled that even if its sales targets were unreasonable, the bank had the right to use them as an employment yardstick. Ms. Guitron appealed the decision and lost again — leaving her with a bill for more than $18,000 in court costs.
“She put her neck on the line” and they punished her, said Yosef Peretz, the lawyer who represented Ms. Guitron. “She’s a single mom with two kids, barely making it, and her reputation was poisoned. No one would hire her.”
Ms. Guitron left the banking industry and now works in property management, he said.
Christopher Johnson, 38, a plaintiff in the lawsuit filed on Monday, said he hesitated to get involved in the legal case because it brought back memories of “a very dark time in my life.” He was fired in 2008 after working for Wells Fargo for five months.
In trainings, the company repeatedly emphasized the importance of its ethics code and urged employees to call its confidential hotline if they observed anything inappropriate, Mr. Johnson said. But just two weeks after he started working as a business banker in a Wells Fargo branch in Malibu, Calif., his manager began pressuring him to open accounts for his friends and family — with or without their knowledge. When he refused, he was criticized for not being a team player.
Mr. Johnson soon learned that his colleagues routinely opened unauthorized accounts for customers who they thought wouldn’t notice, like elderly clients or those who didn’t speak English well. Disturbed by this practice, he did as he was instructed during training and called the company’s ethics hotline.
Three days later, he was fired for “not meeting expectations,” he said. Broke, Mr. Johnson was evicted from his house and spent the next seven months living out of his truck. He put all of his possessions in a storage unit, then lost them to auction when he was unable to pay the storage bill.
Mr. Johnson, who now works as a writer, said he had stepped forward at his mother’s urging: “She was like, ‘Your story needs to be told. You got fired because you tried to do the right thing.’”
Mr. Russell also lost his home after he lost his Wells Fargo job. Unable to find a new position in the industry, he now works part time for a church in Costa Mesa, Calif., helping with its outreach programs for the homeless.
Last week, he watched — in disbelief, he says — as Mr. Stumpf was grilled by the Senate Banking Committee and insisted that Wells Fargo never wanted its employees to do anything unethical to meet their sales goals.
“It’s a crock,” Mr. Russell said. “They established the culture that made this happen — it comes down from the top.”
During the hearing, Mr. Russell said, “I was sitting there in a rage. The people who had a conscience, the employees who refused to go along, they deserve vindication.”
Workers’ efforts to band together to litigate cases against employers are often derailed by mandatory arbitration clauses that require them to address disputes privately and individually. Wells Fargo has such a clause in some of its employment agreements, but it was added only recently, in December 2015, according to Mark Folk, a spokesman for the bank.
Mr. Delshad, the lawyer pursuing the workers’ cases, said he thought the covered class could grow to “tens of thousands of people” nationwide.
“We’ve had former workers, and some current ones, calling our office all weekend,” he said. “We have a whole bunch of new plaintiffs to be added to the suit. It’s just unbelievable, the amount and scope of this fraud.”
Read more from The New York Times.
From The Atlantic:
by Adam Chandler
If it takes three examples to label something a fad, then San Francisco, Seattle, and New York City have collectively been some of American labor’s most prolific trendsetters. In recent years, the three coastal cities were among the first and highest-profile polities to instate a $15 minimum wage, efforts that begot statewide regulations in California and New York and inspired legislation around the country. This urban triumvirate is also part of a handful of American cities to adopt paid-sick-leave policies in recent years.
This month, following San Francisco’s lead, lawmakers in Seattle and New York City have set out to address another progressive cause: hourly workers’ schedules. On Monday, Seattle’s city council unanimously passed a proposal that will require employers to post the schedules of hourly employees at chain restaurants and large retailers no less than two weeks ahead of time. According to the city, Seattle’s Secure Scheduling Proposal is meant to benefit workers who face “erratic schedules, unreliable incomes, involuntary part-time status, not enough time to rest between opening and closing shifts, and coercion from employers to take shifts.” Employers, with some exceptions, will be required to compensate employees with “predictability pay” for last-minute schedule changes. The measure will go into effect next July.
The Seattle vote came just days after New York City officials announced its intentions for a similar plan, which focuses specifically on workers in the fast-food sector in what the city called a “natural next step" following the passage of a $15 minimum wage. Notably, New York's plan would apply only to fast-food workers. “In New York City, we know that most of our fast-food workers are not unionized,” said Freddi Goldstein, a deputy press secretary for Mayor Bill de Blasio. “They don’t have the support of unionized labor and collective bargaining behind them, which obviously helps a lot of our workers come to a better place in the workplace.” She added that the city is studying and consulting with Seattle and San Francisco as it maps out the policy.
While wages and overtime have long driven advocates to gather at the barricades, the issue of erratic scheduling is a concern that has emerged relatively recently, enabled in large part by the rise of scheduling software. Tracking the plight of hourly workers in 2014, Jodi Kantor explained in The New York Times how algorithms allow employers to gauge how and when workers are needed:
"Along with virtually every major retail and restaurant chain, Starbucks relies on software that choreographs workers in precise, intricate ballets, using sales patterns and other data to determine which of its 130,000 baristas are needed in its thousands of locations and exactly when. Big-box retailers or mall clothing chains are now capable of bringing in more hands in anticipation of a delivery truck pulling in or the weather changing, and sending workers home when real-time analyses show sales are slowing. Managers are often compensated based on the efficiency of their staffing."
For many workers, this software has also exacerbated the particulars of a long-standing system in the service industry whereby workers remain on-call (and unpaid) until they are needed, and scramble accordingly; technology has enabled major retailers to turn this practice into a science. (In recent months, several large companies have eliminated the practice.)
But like minimum-wage initiatives, the scheduling ordinances have vocal detractors. Opponents of San Francisco’s measure, which was enacted in 2014, claim that the new policy has led to job cutbacks and reduced hours as well as less flexibility for the service-industry workforce. Ahead of Seattle’s vote, retailers were particularly outspoken about their resistance to the scheduling bill. “In our opinion, the proposed Seattle ordinance would do nothing to improve upon our relationships with employees, and would impose administrative requirements that could make it more inefficient to run the business,” wrote an executive from Costco, a company frequently praised for its progressive business practices. Among those also standing in opposition to the ordinance were Starbucks, Home Depot, JC Penney, and others.
Read more from The Atlantic.
From The Boston Globe:
by Massachusetts State Senator Sal DiDomenico
I WISH I could say I was surprised by the recent Globe investigation into the exploitation of immigrant workers (“The work they need, the perils they face,” Page A1, Sept. 18). Unfortunately, I’m all too aware of the unethical, unsafe, and illicit practices that are pervasive throughout the Massachusetts economy and the construction industry in particular.
I’ve heard from far too many workers who have been misclassified as “independent contractors,” cheating them out of minimum or prevailing wages and leaving them on the hook for medical costs when injured on the job. I’ve spoken with countless immigrants who have been exploited by their employers, going weeks without pay and left unable to care for themselves and their families.
Wage theft comes in different forms, but they all have the common denominator of hurting workers, families, and our communities.
That’s why I filed legislation to prevent this illegal practice and promote employer accountability by giving the state greater power to go after corrupt employers and providing the attorney general with additional tools to hold violators fully accountable.
I was proud to work with my Senate colleagues and friends in labor to get this bill passed in June, but our work isn’t over until this bill becomes law. I plan on filing it again next session, and my colleagues and I in the Legislature will once again have the opportunity tackle this problem. It’s time to stop talking about protecting workers and put our words into action.
Read more from The Boston Globe.
The Enquirer/Patrick Reddy
From the Cincinnati Enquirer:
by Fatima Hussein
Brennan Grayson and Manuel Perez represent the region's low-wage and undocumented workers, who are often taken advantage of by the region's largest employers.
The respective director and membership coordinator for the Cincinnati Interfaith Workers Center, located in the Peaslee Center in Over-the-Rhine, have fought to improve conditions for workers in a variety of roles for the organization.
Last February, Grayson and Perez, along with several volunteers at the workers center, helped pass a local ordinance that prevents city contractors from engaging in wage theft.
Under the measure, if the city or another agency determines a company has committed wage theft, city officials would be able to have the money returned and the company would be barred from doing business with the city.
"Cincinnati’s ordinance is a model for all Ohio cities and sends a message that economic development projects will protect the dignity of wage earners," Grayson said.
The pair spoke with The Enquirer about the issues low wage and undocumented workers face in the area:
Question: What is the biggest issue your clients or workers who come to youface?
Answer: We run a worker rights hotline, 513-621-5991. Most people are looking for help with getting paid for their work. When people work but don't get a legal wage for all their work, that's wage theft. For example, in 2012 the U.S. Department of Labor recovered $212 million dollars in unpaid wages theft, nationwide, but only $139 million was taken nationwide through street, bank, convenience store robberies. It is the crime wave no one is talking about.
Q: Explain what wage theft is and whether it is happening more often or not? Who is particularly susceptible to falling victim to wage theft?
A: Wage theft is the illegal withholding of wages that are rightfully owed to an employee. This can take the form of being paid less than the minimum wage, being shorted hours, being forced to work off the clock, not being paid overtime, being misclassified as an independent contractor so that overtime requirements do not apply, or, as is often the case when an operation winds down or an employee is laid off: not being paid at all.
Q: What was the biggest case your organization took on this year?
A: In the spring, the workers' center collaborated with a local union to uncover massive wage theft in the development of the Princeton pool. This resulted in over $140,000 in recovered wages. But for us, all the cases are important. Even small claims are big to us. The janitor who is ripped off, not paid for cleaning the Immaculate Heart of Mary parish offices, or the ironworkers who (say they didn't) get paid for reinforcing ironwork at the new apartment complex in Clifton, or the framers who help refurbish the many row houses in Over-the-Rhine into high-end condos. Some of the most important breakthroughs come through these smaller cases. The cases that loom the largest are those we haven't won yet, like (allegations of) the tens of thousand in unpaid wages for framing work at the luxury Hunt Road apartments in Blue Ash. Developers want their name in lights when the build something, but want to run and hide when the workers on the project don't get paid.
Read more from the Cincinnati Enquirer.
From Pacific Business News:
by Duane Shimogawa
The state Department of Labor and Industrial Relations has fined Texas-based R&R Construction Services $767,095 for the misclassification of its workers as independent contractors that are part of the Maile Sky Court hotel-condominium redevelopment project in Waikiki.
The state said Monday that R&R has 20 days to appeal the citations.
“Law-abiding contractors who pay their fair share face unfair competition, and workers suffer when deprived of their rights and benefits,” Linda Chu Takayama, director of DLIR, said in a statement. “The visitor industry and a pleasant visitor experience is important to Hawaii, but Hawaii’s working people and law-abiding contractors need to benefit fairly.”
R&R allegedly misclassified 65 construction workers as independent contractors and, by doing so, it avoided requirements to provide unemployment, workers compensation, temporary disability and prepaid health care insurances, according to the state.
About a couple of weeks ago, the state said it was looking into this issue, with Labor Department personnel along with officials from the U.S. Department of Labor Wage and Hour Division and the Hawaii Department of Commerce and Consumer Affairs taking part in a site visit at the condo-hotel after receiving tips of the possible misclassification of workers.
The U.S. Department of Labor’s Wage and Hour Division, which enforces the wage and record-keeping provisions of the federal Fair Labor Standards Act, and the Hawaii Department of Commerce & Consumer Affairs, which enforces licensure, also have opened investigations regarding the employer.
“Legislators significantly increased the penalties for violations of workers’ compensation and temporary disability insurance laws by passing what became Act 187 just this year,” Chu Takayama said. “We believe that the increase in penalties from $1 per day to $100 for temporary disability insurance and worker’s compensation from $10 per day to $100 serves as a powerful incentive for employers to provide these coverages instead of just waiting till they are caught.”
Read more from Pacific Business News.
From The New York Times:
by Julia Preston
Do immigrants take jobs from Americans and lower their wages by working for less?
The answer, according to a report published on Wednesday by the National Academies of Sciences, Engineering and Medicine, is no, immigrants do not take American jobs — but with some caveats.
The question is at the heart of the furious debate over immigration that has divided the country and polarized the presidential race. Many American workers, struggling to recover from the recession, have said they feel squeezed out by immigrants.
Donald J. Trump, the Republican nominee, has called for a crackdown on illegal immigrants, saying they “compete directly against vulnerable American workers.” He promises to cut back legal immigration with new controls he says would “boost wages and ensure open jobs are offered to American workers first.”
Hillary Clinton, his Democratic rival, takes an upbeat view, saying immigrants contribute to the economy whether they are here legally or not, by providing labor for American employers and opening businesses that create jobs for Americans rather than taking them.
The report assembles research from 14 leading economists, demographers and other scholars, including some, like Marta Tienda of Princeton, who write favorably about the impacts of immigration and others who are skeptical of its benefits, like George J. Borjas, a Harvard economist. Here’s what the report says:
• “We found little to no negative effects on overall wages and employment of native-born workers in the longer term,” said Francine D. Blau, an economics professor at Cornell University who led the group that produced the 550-page report.
• Some immigrants who arrived in earlier generations, but were still in the same low-wage labor markets as foreigners just coming to the country, earned less and had more trouble finding jobs because of the competition with newer arrivals.
• Teenagers who did not finish high school also saw their hours of work reduced by immigrants, although not their ability to find jobs. Professor Blau said economists had found many reasons that young people who drop out of high school struggle to find work. “There is no indication immigration is the major factor,” she said.
• High-skilled immigrants, especially in technology and science, who have come in larger numbers in recent years, had a significant “positive impact” on Americans with skills, and also on working-class Americans. They spurred innovation, helping to create jobs.
“The prospects for long-run economic growth in the United States would be considerably dimmed without the contributions of high-skilled immigrants,” the report said. It did not focus on American technology workers, many of whom have been displaced from their jobs in recent years by immigrants on temporary visas.
Read more from The New York Times.
From Al Día News:
by Liliana Frankel
Former employees of the gourmet hors d'oeuvres production plant Perfection Foods are suing the company, saying they were paid less than minimum wage for work weeks as long as 72 hours.
Many of the workers who’ve stepped forward so far are Central Americans. Though potentially hundreds of workers, including many contracted through temporary employment agencies, may be owed back wages, so far the plaintiffs are a relatively small group. Lawyers from Community Legal Services’ Employment division are hoping to be in touch with as many workers and ex-workers of the plant as possible before the end of September.
“The laws say that you deserve to be paid minimum wage and overtime no matter your immigration status,” said Nadia Hewka, one of the attorneys handling the case. “Even those who may have worked under a different name or an alias are still entitled to be paid for all of the hours that they worked and for overtime.”
How can people stay there? I don’t understand why people don’t demand their rights, why they don’t speak out. Sometimes I feel guilty, remembering that I didn’t say anything. But I didn’t know anything about this place, I didn’t know that they were exploiting us.
Scarlet (not her real name) is one of the plaintiffs in the case. She came to the United States from Honduras in 2013, and had to find work right away, as she was in debt from her journey and was also supporting her mother and daughter, who'd stayed behind in the countryside. A friend’s brother told her about Perfection Foods, and soon she was on her feet in the plant’s freezer room every day from 6 in the morning till at least 6 at night—and sometimes later.
“At 5 pm—supposedly—everyone had to leave, because the [Health and Safety] inspector was arriving,” she said. “So what they [the managers] did was tell us to go to the dressing area where we put on our work clothes and wait till he left.”
Once they’d seen the inspector’s car leave the lot, the employees emerged from bathrooms and dressing rooms, punched in again, and continued working until 6, 7, 8 at night. This overtime, though supposedly recorded through the punchcards, was never reflected in the quantity of cash she received at the week’s end: about $170. Even if Scarlet had only been paid for a 40-hour week, that salary is equal to $4.25 an hour, significantly less than minimum wage.
“Everyone complained, ‘Oh, I didn’t get anything, this money isn’t enough, what will I do with it?’” Scarlet recalled. As soon as she could find another job, she quit. “How can people stay there? I don’t understand why people don’t demand their rights, why they don’t speak out. Sometimes I feel guilty, remembering that I didn’t say anything. But I didn’t know anything about [this place], I didn’t know that they were exploiting us.”
In Pennsylvania, the minimum wage is $7.25 an hour, and overtime pay for hours worked beyond the 40-hour workweek should be at least 1.5 times that. But at Perfection Foods, not only were employees paid significantly less, sometimes their hours and deductions weren't accurately recorded. What’s more, Scarlet says that while working at the plant, she was forced to punch out on her timecard if she needed to eat lunch or use the bathroom.
Even if Scarlet had only been paid for a 40-hour week, that salary is equal to $4.25 an hour, significantly less than minimum wage.
Scarlet had never worked in an industrial setting before her job at Perfection Foods, “a very bad experience.” After she was finished at the plant, she never considered going back; in fact, the thought of it had her “biting her nails.” Instead, she found work cleaning houses, a job which pays nearly five times what she was making before.
It’s important, she said, “that your work be valued. My new boss never bothers me, never,” even though there’s always work to do.
When asked about the case, Bob Burke, an attorney representing Perfection Foods, responded that his client “denies [the plaintiff’s] allegations and will vigorously defend against the claims in court.”
Read more from Al Día News.
From The Hill:
by Alba Morales
Last month, the U.S. Department of Labor announced that U.S. Senate federal contract workers like me had been robbed of over $1 million dollars from our paychecks by our employer, Compass Group.
DOL found that Compass had been paying us less than the legal rates for our jobs, had not being paying us proper overtime or even for all the hours we worked, and had not kept proper payroll records.
Within weeks, some of my co-workers started receiving as much as $20,000 in back-pay awards. But I only received $240, with no explanation of how it was calculated.
I’ve worked at the Senate for over a decade and I believe the company likely stole much more than a couple of hundred bucks from me.
And I’m not alone. Over a dozen Senate contract workers received little or no compensation as wage theft victims.
Worst of all, neither myself, nor any of these workers were contacted or interviewed by the Labor Department or the Architect of the Capitol, the agency that oversees the contract, as part of the investigation.
Since we did not have the opportunity to speak with investigators, DOL must have based its calculations of the back pay we are owed on information provided by the Compass. But how can this make sense when DOL also found that the company had been keeping false records?
The truth is that this is a symptom of a bigger problem: Workers and our representatives have not been invited to participate in the investigation and settlement talks even though we exposed the illegal conduct and are directly impacted by the results.
If this were a court case, the victims would have their say, but we are low-wage workers who can’t afford a private attorney.
That’s why workers are sending a letter to the Architect of the Capitol and the Department of Labor to request that our voices are respected.
For us, respect means a willingness to bring workers into the process.
We want to make sure every worker at the U.S. Senate is interviewed by Labor Department investigators and provided with an explanation of how their back-pay awards were calculated.
But even more importantly, we want to be represented during the negotiation of the final settlement. We believe that we can play a role in holding the company accountable to following the law.
Read more from The Hill.
Harry Fisher/The Morning Call
From The Morning Call:
by Anthony Salamone
The union representing about 400 workers at Just Born Quality Confections has filed a complaint with the National Labor Relations Board, alleging a nonunion employee posed as a union representative and urged striking members to return to their jobs.
The Bakery, Confectionery, Tobacco Workers and Grain Millers International Union Local 6 filed an unfair labor practice charge, union organizer John J. Price said Friday. He said the union had received several complaints that an unidentified nonunion company employee was telling striking members "they could cross the [picket] line, that it's OK to go back to work."
While a company can notify its workers of any consequences regarding a strike, the union alleges that Just Born is misleading the workers by its action.
Harold Maier, assistant regional director with the National Labor Relations Board's Philadelphia office, said the agency will review the complaint, which was filed Thursday, but a decision on its validity could take up to 10 weeks.
Matt Pye, Just Born's vice president of corporate affairs, said the company had not seen the complaint as of Friday afternoon.
"We can't comment until we see the details," he said. "Our hope is that the NLRB will rule pretty quickly."
Workers have been striking since Sept. 7 outside Just Born's headquarters and plant at 1300 Stefko Blvd. after negotiations on wages, health insurance and pension broke down, according to the union.
The key sticking point is the pension, according to the company. The union says Just Born wants to eliminate its defined pension, while the company says it is willing to keep current workers in the pension while putting new workers in a 401(k) retirement plan. The pension has simply gotten too costly, the company says.
A brief synopsis of the union's complaint appears on the NLRB website, but Maier said the entire case was not available Friday because the agency needs to review it first for any possible redactions.
The complaint against the maker of marshmallow Peeps, Mike and Ike, and other candy specifies it is an unfair labor practice for an employer "to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed" under Section 7 of the National Labor Relations Act. Those rights include forming and joining a union and collective bargaining.
Meanwhile, the company has kept up production by using nonunion workers and hiring what it calls permanent replacement workers. Just Born held a job fair Thursday that drew about 175 people and at least 600 people have applied for jobs online.
A recent ruling by the NLRB subjects employers to penalties, such as back-pay liability, if the union can show that hiring replacement workers was a punitive measure or intended to prevent future walkouts. That ruling is under appeal.
Read more from The Morning Call.
From The Boston Globe:
by Beth Healy and Megan Woolhouse
Luis Mayancela was 15 years old when he fell from the roof of a house in Portland, Maine, where he was helping fasten shingles. He tumbled two stories, severely breaking his leg.
His employer did not call an ambulance. Instead, a co-worker drove the Brockton High School freshman 75 miles in an old work van, across state lines, to a hospital in Massachusetts. As they crawled through rush-hour traffic, Mayancela had no idea his boss would try to dodge responsibility for the accident.
“I couldn’t breathe, much less talk,” recalled Mayancela, an Ecuadoran who took the job in 2013 to help support his family. “It’s pain you don’t forget.”
He is one of thousands of immigrants, many undocumented, helping meet the demand for workers in the region’s booming construction industry. They haul slabs of sheetrock and climb rooftops and dusty scaffolds, doing often dangerous work for contractors seeking cheap labor.
A Globe investigation found that these workers, eager for a paycheck, are often paid below the prevailing wage and illegally, in cash. They are also the most likely to be subjected to unsafe work conditions, without insurance to cover medical bills or lost pay if they get hurt. And the unscrupulous contractors who employ them are too seldom caught and penalized.
“This is not about catching a few bad actors that are dragging down the industry,’’ said Diego Low, director of the Metrowest Worker Center in Framingham, which helps workers fight for fair wages and safety. “We’ve evolved a system for providing subsidized labor to build our houses, and it’s based on the vulnerability of the workforce.”
Federal officials identified 910 “willful or repeat violations” that involved hospitalizations or deaths in the Massachusetts construction industry over the past three years, according to public records requested from the US Labor Department’s Occupational Safety and Health Administration. Of those, 98 percent took place on jobs run by nonunion contractors, OSHA said.
The real number of injuries is likely higher, advocates and government officials said, because undocumented workers on these job sites often are pressured not to report accidents.
Interviews with more than three dozen construction workers, legal advocates, and regulators, as well as construction site visits and the review of hundreds of pages of records, reveal industry practices that routinely exploit immigrant workers. They also point to companies that are repeat offenders, undercutting legitimate contractors who play by the rules.
Sometimes the victims are minors, or young men barely in their 20s.
Among the personal stories uncovered by the Globe:
■ A 23-year-old roofer from Ecuador shattered his collarbone after falling from a 32-foot ladder in Waltham during Christmas week in 2014. His employer told him to drive himself home, even though he had been briefly knocked unconscious. It took five days for him to get medical care, and a year-and-a-half before receiving the surgery he needed to repair the break.
■ A dozen immigrant workers repeatedly sought a combined $150,000 in back wages from a New Hampshire drywaller who, they said, threatened not to pay them if they quit. When they finally made plans to leave, he left a profanity-laced voicemail on the phone of one of the workers.
■ A former Boston restaurateur-turned-contractor routinely failed to pay immigrant construction workers, even after they traveled to his home to complain and court judgments were entered against him.
“We know these workers are particularly susceptible to abuse,’’ Massachusetts Attorney General Maura Healey said in an interview. “They switch locations; they switch bosses regularly. By the time they complain to us, or we become aware of it, the bad actors may be long gone from the scene.”
Plenty of US citizens and documented workers get hurt in construction, too. But undocumented immigrants, deeply woven into the fabric of the economy in ways often overlooked by the public and political candidates, face additional struggles.
Many do not speak English and are unfamiliar with federal and state labor laws, which require employers to pay them at least minimum wage and carry workers’ compensation. These workers are often improperly characterized as independent contractors by employers who want to avoid paying their insurance and payroll taxes.
“There’s no contractual obligation between the employer and their workers,’’ said Marcy Goldstein-Gelb, longtime executive director of the Massachusetts Coalition for Occupational Safety and Health, who was recently promoted to run the national organization. “There’s no written agreement that if they speak up about health and safety, that they still have a job.”
When injured, these workers can get lost in medical limbo. If they tell doctors they were hurt on a work site but have no pay stubs or documentation to prove who their employer is, it can be next to impossible to get care, according to lawyers, advocates, and regulators.
That’s what happened to a 16-year-old Guatemalan youth, nicknamed Baby, on the work sites of a Lynn contractor. He plunged to the ground last fall from a ladder while lugging too much wood for his 118-pound frame.
His employer dropped him off at home that night instead of taking him to a doctor, according to the boy’s account to the Globe, his lawyer, and advocates. He was for months declined medical care because he had no legal guardian and no employer offering to pay his insurance, his lawyer said.
In another case, Isidoro Peralta, the Ecuadoran roofer, had to fight for medical care for a year-and-a-half after falling from a ladder in Waltham. While he waited, his collarbone healed improperly and he could no longer lift weight with his right arm. He was out of work, without pay, and in pain.
When Peralta talked to his employer at AN Construction, “Nothing happened,” he said.
Indeed, his boss, Angel Namina, denied to his insurer that Peralta was hurt on the job, according to Peralta’s workers’ compensation claim filed with the state.
The owner of the Milford construction outfit did not answer calls to his phone and could not be reached. He has failed to pay a fine for a prior serious violation with OSHA for failing to guard against fall hazards, according to public records.
Peralta’s lawyer fought the claim denial and reached an agreement with the insurer, so Peralta could have surgery. His doctor at Boston Medical Center said he had to cut apart his clavicle and repair it. Peralta said he was warned that if the doctor missed by a quarter-inch and sliced an artery, Peralta would be at risk of dying within a minute.
“I did it,’’ said Peralta through a translator, his youthful smile covering up many months of stress. “Thank God it came out OK.”
. . .
AT LUXURY CONDOMINIUMS in Wellesley and modern apartment complexes in Chelsea, as well as building projects for colleges and major retailers, developers have been accused of looking the other way when subcontractors underpay workers and cut corners on safety.
Wage and safety violations have resulted in 1,300 complaints in the past three years just to the Massachusetts attorney general’s office. Some incidents have involved broken limbs, concussions, and wounds that went untreated for long periods because employers failed to provide the required insurance.
Many workers are urged not to say that injuries occur on a work site. Some fear losing their jobs if they complain, or worse, being exposed as undocumented, then deported.
Mayancela, who fell from the roof in Maine in the summer of 2013, was lucky in one way: He eventually received the care he needed, after being transported to Boston Children’s Hospital and later having a rod surgically placed in his femur.
Low, the Metrowest worker advocate, helped him navigate medical appointments. A Medford lawyer who specializes in such cases, Stacie Sobosik, cut through layers of subcontractors to find an employer in the chain whose insurance would pay for his coverage.
“It had nothing whatsoever to do with our company, although it dragged us through the mud for a while,’’ said King Weinstein, the Old Orchard Beach, Maine-based general contractor at the house where Mayancela fell. He said his firm ran its usual checks on the Massachusetts roofing subcontractor, Force Corp., and confirmed it had liability insurance and workers’ comp coverage at the time it was hired.
But those checks did not turn up problems at Force or with its general manager, Juliano Teles Fernandes.
Mayancela was receiving pay on the Portland job from Twin Pines Construction Inc., a company owned by Fernandes.
He and companies he has owned or managed have been cited for more than 100 violations since 2007, by federal safety regulators, including some that endangered workers’ lives, according to public records.
Over his career, Fernandes has racked up obligations and fines of $1.5 million with OSHA that have not been paid. The US attorney’s office in Boston is suing to collect those.
Fernandes and his Twin Pines firm were cited by the agency in May 2013 for serious and willful violations. That June, Fernandes let his workers’ comp policy lapse, according to public records. A month later, Mayancela fell from makeshift scaffolding in Maine.
Fernandes would claim to OSHA investigators that yet another subcontractor was the teen’s employer. But if there was such an assignment, it was informal and did not relieve Fernandes of his responsibility. The insurer for the other subcontractor — the same as Force’s — ultimately covered the claim. Force, which has had offices in Woburn, Clinton, and Lunenburg, was cited by OSHA in the Mayancela case for having a child under age 16 do hazardous construction work and for failing to keep proper date-of-birth records.
It’s illegal in Maine to hire anyone under age 18 for roofing. Yet the fine was modest: $15,350.
Meanwhile, even the serious injury of a 15-year-old and a string of fines didn’t move Force or Fernandes to change their ways. Last December, Force was sanctioned yet again, for exposing roofers to potentially fatal fall hazards, and for what OSHA called “unacceptable behavior that must change before a worker’s life or career is destroyed.’’
Fernandes could not be located at his listed addresses and declined to comment through a spokeswoman. This summer, federal authorities reached a settlement with Force to pay $2.4 million in back wages and damages to 478 workers for “willful” violations.
Force, in a statement at the time, said, “We take our commitment to our employees seriously and have cooperated fully with the DOL in its review, and are pleased to have resolved this issue in the best interest of our employees.”
Force also said, in response to Globe inquiries, that it is now requiring more safety training for workers and is “actively monitoring all job sites” for compliance. “We now better understand how critical it is to provide OSHA with feedback and contest findings in real time.”
. . .
STACIE SOBOSIK, the Medford attorney who represents injured workers, said the most frustrating part of these cases is how general contractors persist, even after egregious workplace violations, in hiring abusive subcontractors.
“They don’t care. They’re going to keep using this company because they’re cheap labor,’’ Sobosik said. “There’s a reason that they’re so inexpensive compared to the market,’’ she said. “It doesn’t come free, that discount.”
Force recently landed a job working on a new 447-unit development at Somerville’s Assembly Row. The contractor that hired the company is Callahan Construction Managers, a Bridgewater company that has managed several of the largest residential projects in the Boston area in recent years.
Callahan, unlike Boston’s downtown commercial developers, often hires nonunion labor. The firm has been criticized by public officials in Quincy and Cambridge for allegedly failing to thoroughly vet its subcontractors.
The company’s president, Pat Callahan, said in a statement that when he hired Force, he was unaware of its issues with the Labor Department and OSHA.
“Since these matters came to light, Callahan has employed a stringent workforce monitoring process, and we are enforcing the right to inspect payroll records,’’ he said in the statement. “In the meantime, we are confident in the work Force Corp. is performing at Assembly Row.”
General contractors bid on multimillion-dollar jobs and divvy up the work to a thicket of smaller firms. It has proven notoriously difficult for authorities to police those subcontractors, according to regulators in Massachusetts, New Hampshire, and Connecticut.
“People, when they cheat the system, recognize big cost savings,” said Rudolph Ogden, an attorney for New Hampshire’s Department of Labor. He said the state is working to crack down on employers who break the law, but, “A lot of times we only hear when people stop getting paid. Or get hurt.”
. . .
JUAN GONZALEZ, a 36-year-old from Mexico, worked for Yankee Drywall Corp. in Hudson, N.H., for nearly 15 years. His father, nephew, and cousin worked there too. He put up with the company’s difficult owners, he said, because the money was good. He started at $26 per hour and worked his way up to $33, and made enough to send some home to his mother.
“I love what I do,’’ Gonzalez said. “Create something. You can be proud.”
The company is owned by Gerald “Gerry” Crete, a gruff 59-year-old who runs the business with his wife, Martha Laramee, out of their home. They have a tidy yard and $50,000, his-and-hers, four-door Ford pickup trucks, black and white, in the driveway.
There would be weeks the workers were paid, followed by missed weeks, then promises of catching up. By late last year, Yankee allegedly owed more than $150,000 to a dozen workers, including Gonzalez and his family members.
“They used to tell us, ‘If you leave, I’m not going to give you the money. So you’ve got to show up for work tomorrow,’ ” said Iran Gonzalez, Juan’s cousin.
In late December, Juan Gonzalez received an angry voicemail from Crete, peppered with expletives, pleading with him and the other workers to return, and promising they would be paid. But the Gonzalez family had had enough: This time, they took their complaints to the authorities.
“You have to be a tough guy in this business,’’ Crete said during an interview in the couple’s kitchen in March. He called the industry “crooked,” and bitterly blamed missed payments to his crew on contractors who, he said, owed him money.
He said he owed the men no more than $5,000 each in back pay. But Juan Gonzalez said he alone is owed more than $20,000.
“I’m broke,’’ Crete said. He claimed to have filed for bankruptcy protection, but there were no such records in federal court in New Hampshire.
In April, Attorney General Healey’s office investigated and cited the company and Crete $26,000 for intentionally failing to pay employees and misclassifying them as independent contractors to avoid paying benefits and workers’ compensation.
Crete failed to respond to the AG’s demand for records, according to Healey spokeswoman Jillian Fennimore, and allegedly ignored multiple attempts to resolve the allegations.
New Hampshire’s labor department is pursuing Yankee for $171,000 in unpaid wages plus penalties. A hearing is set on the matter for October.
. . .
EVEN WHEN AUTHORITIES do catch firms breaking the law, it can be cheaper for employers to pay fines than follow the rules. Some firms simply skip town and open under a new name.
Of the 1,300 complaints to the Massachusetts attorney general over the past three years, the office issued 455 citations against construction employers, sometimes multiple times, seeking restitution totaling $2.4 million and nearly $1 million in penalties, according to public records requests.
But companies often fail to pay even small sums. Healey’s office has collected just one-third of the $1.7 million in violations since January 2015, or $580,234. The bulk of the rest is under appeal or past due.
The AG’s office can’t readily say how much it collected prior to 2015, because the records were not computerized.
In Massachusetts, workers have to navigate a number of agencies to complain about employers who break the law. Neither the attorney general nor OSHA can easily shut down a company, even if it has multiple violations against it. The state Department of Industrial Accidents can issue stop-work orders when its investigators find companies not paying for workers’ compensation.
Governor Charlie Baker and Deval Patrick before him have heard the complaints of union executives that firms paying in the low $20s per hour or less, without overtime or insurance, are unfair competition. The residential union construction rate in Boston, including insurance and benefits, is $45 per hour, according to the New England Regional Council of Carpenters.
“This is wage theft,’’ said Manny Gines, an organizer for the union, who travels the Northeast helping workers and confronting companies that are breaking wage laws. “We really can’t compete with them if they’re not getting paid.”
. . .
THE RECENTLY COMPLETED One North of Boston complex in Chelsea, a $110 million project with some 450 apartments, boasts luxury studios for $1,735 a month and two-bedrooms for $2,390. There are yoga and spin studios, an indoor basketball court, and doggie day care.
The general contractor was Callahan, the Bridgewater company. On one visit by the Globe, Universal Drywall of Auburn, N.H., had about 30 workers framing and building walls at the massive property; only a handful were marked as employees on sign-in sheets.
The rest were classified as subcontractors — the same practice the attorney general challenged when it sued Universal in 2014, alleging a “pattern of unfair competition” on the Chelsea job because it did not pay workers as employees. That case is ongoing, according to the AG’s office.
Read more from The Boston Globe.
Andre Malok | NJ Advance Media for NJ.com
by Kelly Heyboer
As the sun begins to rise, Rafael Sanchez emerges from the unheated garage that serves as his home and joins the other temporary workers hustling toward French Street.
He becomes part of a small crowd gathering outside of one of several storefront temporary employment agencies that line the busy street. While the rest of the city is waking up, this immigrant neighborhood in the heart of Middlesex County is bustling.
At 6 a.m., a gray van rumbles up to the agency Sanchez and about a dozen people silently climb inside. The van travels 30 miles south to a factory near Trenton.
For the next eight hours, Sanchez, 65, will stand at a packaging machine on an assembly line. Though he is a temp — short for temporary worker — he has worked in this same factory for six years.
The Mexico native earns $10 an hour with no paid vacation days, few benefits and little hope of ever getting a raise. After his temp agency takes out taxes, the cost of the van ride and other fees, Sanchez will take home $295 at the end of the week, according to his pay stubs.
"Not enough," Sanchez says, in Spanish, with a weary smile. As an immigrant living in the country illegally, he says this is the best job he can find.
The business of providing blue-collar temps to factories and warehouses is booming in New Jersey, which now has one of the largest concentrations of temp workers in the nation, according to federal statistics. The increasing demand has helped spawn what researchers call "temp towns." They are places like Union City, Elizabeth and, especially, New Brunswick, with dozens of small temp agencies and neighborhoods full of temp workers.
But New Jersey's "temp towns" have a dark side. Workers and activists say the sector of the temporary employment industry supplying blue-collar workers to warehouses and factories is rife with mistreatment. They complain about low pay or not being paid at all, rampant racial and sexual discrimination, unsafe working conditions and a system that seems to exploit them at every turn.
Many temps, including Sanchez, are immigrants living in the U.S. illegally. They say the storefront temp agencies in Hispanic neighborhoods routinely overlook their illegal status and provide them with a vital link to paying jobs in New Jersey's growing network of warehouses and factories.
Because few temps are willing to risk deportation by reporting mistreatment to authorities, workers say they often endure working conditions reminiscent of the troubled countries they fled.
With assistance by Reveal from The Center for Investigative Reporting -- a nonprofit news organization based in California -- NJ Advance Media spoke to dozens of temp workers, temp agency recruiters, labor activists, government officials and experts over several months about the industry in New Jersey. Among the findings, which reflect a national investigation by Reveal:
- Racial discrimination is widespread in temp agencies supplying blue-collar workers. In New Jersey, agencies sending workers to warehouses and factories in Central and North Jersey are overwhelmingly located in Hispanic neighborhoods, according to one study. Workers allege companies prefer, and often request, Hispanic temps, who are less likely to complain about low pay or poor conditions because many of these workers are new immigrants or are living in the country illegally.
- Gender discrimination is rampant in the employment agencies. Women are often paid less than men in blue-collar jobs. Photos taken by New Labor, a local activist organization, show some temp agencies advertise "women's jobs" and "men's jobs," in what a Rutgers University report calls a blatant violation of federal law.
- Many warehouses and factories offer little, if any, safety training to temps. At least three workers have died in recent years, including a temp who was crushed while sorting packages at an Amazon fulfillment center in Woodbridge in 2013, according to U.S. Department of Labor's Occupational Safety and Health Administration reports. Other New Jersey companies have been fined for exposing temp workers to hazardous chemicals, excessive noise and other dangerous conditions.
- Several prominent temp agencies in New Brunswick and surrounding towns appear to be operating without a license, in violation of state law, according to a check of a state database of licensed firms. When questioned about the unlicensed firms, the state Department of Consumer Affairs, which oversees licensing of temp agencies, said it would investigate. However, a department spokeswoman admitted Consumer Affairs has not investigated any temp agencies in years.
While parts of the U.S. economy have struggled to recover from the recession, the temp industry is thriving. Last year, there were nearly 3 million temps employed nationwide, an all-time record, according to data from the federal Department of Labor Statistics. Other studies conducted by the temp industry say the numbers are much higher and as many as one in 10 workers nationwide is temporary.
"There are more temp industry offices in the U.S. than (restaurants of) the big three burger companies — McDonald's, Burger King and Wendy's — combined," said George Gonos, a labor studies professor at Florida International University.
Middlesex County alone averaged between 18,000 and 23,000 temp workers a month last year, according to federal statistics. Temp workers made up more than 6 percent of the county's workforce, nearly triple the national average. Passaic and Burlington counties also have some of the highest percentages of temp workers in the nation.
While temps may bring to mind the image of the "Kelly Girl" office worker who is hired to do a few days of filing or reception work, the industry has changed. About half of temp workers nationwide work in transportation or "light industrial" jobs in warehouses and factories, according to government statistics.
Every time a consumer picks up something at Wal-Mart or orders something on Amazon, chances are good a temp worker has handled the merchandise. The low cost of these workers helps keep down the price of products and helps companies offer cheap, fast shipping.
In New Jersey, the temp industry has been fueled by the surge of container ships bringing foreign-made goods into the Port of Newark, the second-busiest port in the nation after the combined Ports of Los Angeles and Long Beach.
To handle the goods, companies have built giant warehouses and distribution centers near the New Jersey Turnpike.
Many companies and retail chains also save money by hiring third-party logistics firms to run the warehouses, according to researchers who study the industry. The logistics firms often hire temp agencies to supply staff for the warehouses to easily increase or decrease the number of workers during busy or slow seasons.
Some workers become "perma-temps," working in the same warehouse for years without getting hired as permanent employees with benefits.
Temp workers in New Jersey warehouses and factories typically earn between $8.38 (minimum wage) and $12 an hour, and have no guarantee of work every day, according to workers.
In many New Jersey warehouses and factories, the temp workforce is entirely Hispanic, Gonos said.
In a 2011 study, Gonos and a Rutgers researcher mapped dozens of blue-collar temp agencies in New Brunswick, Union City, Elizabeth, Paterson, Passaic, Plainfield, Trenton and other cities. Nearly all the agencies were located in or bordering on neighborhoods with the highest percentage of Hispanic residents.
Warehouse supervisors and employers want Hispanic workers, due in part to the fact that they are likely to accept low pay and difficult conditions because they are either new immigrants or are living here illegally, Gonos said.
"The reason they do that is they are the most vulnerable workforce and hardworking," Gonos said. "And the temp agencies exploit them to the hilt."
The New Jersey Staffing Alliance, the industry group that represents the state's temp agencies, disputes any allegations of widespread mistreatment of temporary workers.
Temp firms are closely watched by several state and federal agencies and undergo regular audits by their workers' compensation insurance providers, said Elaine Balady, a spokeswoman for the New Jersey Staffing Alliance and a 30-year industry veteran.
"We have to meet the standards, and I think as an industry we do," said Balady, president of the Assurance Group, a Bergen County-based temp agency, executive search and consulting firm.
But Balady said there may be some temp agencies that are mistreating workers.
"Like every industry, there are some people who don't follow the rules," Balady said. "NJSA doesn't support that."
It is unclear how many temp workers in New Jersey are immigrants living here illegally.
Louis Kimmel, executive director of the New Brunswick-based worker activist group New Labor, says a large percentage of temp workers in immigrant neighborhoods turn to agencies because they are not authorized to work in the U.S.
"Temp agencies set up shop basically wherever there are Latino neighborhoods in New Jersey," said Kimmel, who has spent more than 15 years advocating for temp workers. "So that's New Brunswick, Perth Amboy, Paterson, Union City, Passaic, Plainfield."
Workers say it is easy to purchase forged Social Security cards or simply share stolen or fake Social Security numbers to fill out temp agency applications.
"That's the way everyone does it. You're able to find papers," said Carmelo Hernandez, 56, a temp worker who came to the U.S. illegally from Mexico and says he has had the same $10.25-an-hour assignment unloading trucks at a clothing company warehouse for nine years.
Balady, the spokeswoman for the New Jersey Staffing Alliance, said her employment agency is among those that use E-Verify, the government's online system to check if a potential employee's name matches the Social Security number on his or her application.
Some states, including Arizona, Mississippi, South Carolina and Alabama, require employers to check E-Verify before hiring someone. New Jersey is among the states that don't require employers to use E-Verify.
Lyneer Staffing Solutions, a national temp agency with an office in New Brunswick, uses E-Verify and tries to confirm all its temps are in the country legally, said Bryan Smith, president of the Lawrenceville-based firm.
But the process is not foolproof, he said.
"All of our employees go through the full compliance and verification process," Smith said. "If people are presenting documents that are not theirs, we can't police everybody."
In a 2013 lawsuit, the former director of human resources at Lyneer accused the temp agency of intentionally using and hiring "illegal and/or undocumented employees." The lawsuit was settled out of court and neither side would comment on the case.
At Delta Personnel Services, president and chief executive officer Stan Lyskowski said his temp agency uses E-Verify to confirm temps are in the country legally only if a company requests it.
Delta places as many as 600 temps a week out of its offices in New Brunswick, Bound Brook and Somerset, said Lyskowski, a 30-year veteran of the temp industry. Under New Jersey law, temp agencies are not required to investigate whether the social security cards and immigration documents handed over by employees are legitimate.
"We certainly don't knowingly employ any illegal aliens," said Lyskowski. "If the documents presented to us look legitimate ... we process the person."
The temp agencies in New Brunswick are easy to spot. They are the businesses lit before dawn year-round. Inside, there are rows of men and women sitting in folding chairs. Some look anxious. All look weary.
They are waiting for their names to be called for a job for the day. The stakes are high. If their names are not called, they don't get paid. If they don't get paid too many days in a row, they can't pay their rent and they can't buy food.
Some are lucky to score "perma-temp" positions, assigned to the same warehouse or factory every day for years. Others sit in the agencies daily, waiting for short-term assignments.
Reynalda Cruz said she spent nearly two decades working on and off for On Target, Delta, Olympus and a long list of other local temp agencies in her New Brunswick neighborhood.
Over the years, she packed flowers, boxed up candies, sorted packages, worked on an assembly line at a pharmaceutical company and did other jobs at a series of warehouses across Central Jersey.
If she complained that the agency vans were overcrowded or the warehouses were unheated, or questioned whether the chemicals she was breathing were dangerous, Cruz said she usually heard the same answer.
"All the jobs are the same. They say, 'You don't want it? There's someone else,'" said Cruz. Frustrated with the treatment she received daily, she left temp work a few years ago to become a community organizer with New Labor, the worker advocacy organization in New Brunswick.
Some of Cruz's former employers, including On Target, did not respond to requests to comment on how they handle complaints from workers. Olympus is no longer in business.
The owner of Delta Personnel Services disputed Cruz's claim that his temp agency fails to respond to workers' complaints about safety and working conditions.
The agency has an extensive screening process to inspect worksites and check the safety record of companies before placing temps in warehouses and factories, said Lyskowski, Delta's owner.
Delta pays more than $700,000 for worker's comp insurance each year in the event someone is injured, he said. It would be bad business to ignore the safety of temp workers and risk driving up the cost of that insurance, he added.
"We pride ourselves on that," Lyskowski said. "We're going to get bit by having an inordinate amount of injuries."
There is little Delta can do about worker complaints about excessive hot or cold conditions in warehouses, which are often unheated and unairconditioned, company officials said. But the agency has pulled workers out of some jobs, including a warehouse where temps complained they were required to work in a freezer without insulated suits.
Delta has also removed temps from warehouses where they were asked to perform duties outside of their job descriptions, including driving forklifts, company officials added.
"We've actually walked away from companies because (temps) were doing things that weren't reported to us," said Maritza Hernandez, Delta's operations manager.
It is a complicated process to get workers from the street to the factory in the temp industry.
Under the system, companies or logistics firms call in orders to the temp agencies for a certain number of workers. It is up to the agency to select workers. The agencies usually are paid a certain amount per worker. After paying the worker, the agencies keep the rest of the fee for expenses and profits.
Because agencies do not need to explain why they choose one worker over another for an assignment, temps say discrimination often goes unchecked.
Several logistics firms declined to comment on hiring practices in the industry.
'Culture of flirting'
Last year, Rutgers University researchers released a study on the conditions female temp workers face in New Jersey warehouses. The study, based on interviews with dozens of temps in New Brunswick, found widespread gender discrimination and sexual harassment.
New Jersey women working as temps described a "culture of flirting" in which temps who respond favorably to sexual comments or inappropriate touching from warehouse or factory supervisors are rewarded with better jobs or easier work, according to the report by Rutgers' Center for Women and Work.
The women who complain about harassment risk not getting called back for assignments. So most stay silent, the study found.
"They don't have other options, really. I don't think that they are willing to endure it — they have to," said Danielle Lindemann, one of the Rutgers researchers, now working as an assistant professor of sociology at Lehigh University.
Women temps also were routinely paid less than men for the same assembly line work and were rarely given higher-paying forklift operator jobs, the study found.
The report included photos of signs in Spanish in New Brunswick temp agencies advertising work "for men only" and lower-paying jobs "for women."
"They are doing things that are blatantly and patently illegal," Lindemann said.
Activists with New Labor, the New Brunswick-based workers group, said they took the report to several agencies, including Lyneer Staffing Solutions and On Target, late last year to show managers. Some agencies let New Labor activists remove the signs, said Kimmel, the group's executive director.
Representatives of On Target did not respond to requests for comment.
Bryan Smith, the president of Lyneer, said he was unaware there were signs advertising men's and women's jobs in his New Brunswick branch.
"That is absolutely not our policy," Smith said.
Germania Hernandez, a longtime temp now working as a community organizer in New Brunswick, said it is unlikely conditions have improved for female temps since the 2015 Rutgers report highlighted the alleged abuses.
Hernandez, 43, said she spent years going to assignments where she had no opportunity to ask about getting one of the better-paying "men's" positions at the warehouses.
"Simply, I was told to sit there. Go over here or go over there," Hernandez said through a translator. "Sometimes they didn't tell us what they were going to pay us or how many hours we were going to work. ... It was as if we were sent like a doll or something."
If temp workers want to complain about agencies, it is often difficult to know where to turn.
Temp agencies are overseen by a complex web of state and federal agencies, including the state Department of Consumer Affairs, the federal Occupational Health and Safety Administration, the Equal Employment Opportunity Commission and both the state and federal labor departments.
Under New Jersey law, a temporary agency must put up a $1,000 bond and apply for a license for each office it opens in the state. But an NJ Advance Media check of several large agencies in and around New Brunswick found at least four prominent firms that appeared to be unlicensed, according to the database of 2,200 licensed temp agencies and employment consulting companies available on the state Department of Consumer Affairs' website.
When asked about the locations, a department spokeswoman confirmed the temp agencies appeared be "engaging in unauthorized activities" and would be reviewed.
In 2013, Command Center, an Idaho-based temp agency, paid $27,800 in a settlement with the state after being accused of opening offices in Newark and Paterson without a license. The state began investigating when temp workers hired to do post-Hurricane Sandy cleanup work complained Command Center was not paying them as promised.
In the settlement, Command Center did not admit to doing anything wrong. It has closed its New Jersey offices.
Since that investigation three years ago, there have been no attempts to crack down on illegal temp agencies in New Jersey, said Lisa Coryell, a spokeswoman for the state Department of Community Affairs.
"The division has not received complaints about any employment agency or temporary help service firm ... in recent years," Coryell said.
A spokeswoman for the state Department of Labor, which investigates complaints about workers not getting properly paid, said it has no statistics on how many investigations it has done into temp agencies because it does not track cases by industry.
The federal Equal Employment Opportunity Commission, which oversees complaints of gender and racial discrimination, has taken temp agencies to court in several high-profile cases in Chicago.
However, the number of investigations the commission has done in New Jersey is so low there are no statistics available for recent years, said Raechel Adams, EEOC's acting regional attorney for the New York district, which includes New Jersey.
All workers, even those living in the country illegally, have the legal right to complain about safety hazards, discrimination or other abuses, federal officials said.
"We are absolutely interested in pursuing these kinds of cases," Adams said. "EEOC does absolutely pursue cases regardless of (immigration) status."
Deaths on the job
The federal Occupational Safety and Health Administration – known as OSHA-- investigates workplace accidents and safety complaints. The agency started a campaign three years ago to focus on safety for temp workers.
The problem is temp workers often get little or no safety training from their agency, factory or warehouse because it is unclear who is responsible for training the workers.
"The temp workers are often put in the position where no one is taking responsibility," said Steven Kaplan, OSHA's assistant regional administrator for federal enforcement operations.
At least three temp workers from New Jersey died on the job in recent years.
Ronald Smith, of Irvington, was working for the temp agency Abacus when he was crushed in a conveyer belt at an Amazon fulfillment center in the Avenel section of Woodbridge in 2013, according to OSHA reports.
Mark Jefferson, of Trenton, was a Labor Ready temp when he died in 2012 while working in extreme heat as a garbage collector for Waste Management in Hopewell Borough, the reports said.
James Hoyt, a Labor Ready temp from Bogota, was killed in 2012 when he was crushed by a 2,500-pound rack of computers that tipped over while he was loading them into a truck. Hoyt's family was disappointed when OSHA fined the agency and other companies involved in the accident $2,800.
"We thought it was toothless — $2,800? That's not much of a deterrent," said his brother, Mike Hoyt. "It's nobody's job to keep these people safe. It's all put on the workers. These temp workers are kind of cannon fodder."
Labor Ready, Waste Management and Abacus did not respond to requests to comment on the deaths of their temp employees.
Kelly Cheeseman, an Amazon spokeswoman, also declined to comment on the 2013 death of the temp employee in its Avenel warehouse. But she said temp employees make up a small percentage of Amazon's workforce.
"Nearly 90 percent of employees across the company's U.S. fulfillment network are regular, full-time employees. As a way of finding high-quality permanent employees to manage variation in customer demand, we also employ seasonal associates," Cheeseman said.
In 2015, OSHA conducted 219 inspections of factories and warehouses in New Jersey and handed out $1.9 million in penalties in its effort to focus on temp safety, according to agency records.
In each case, OSHA officials said they fined the company and the temp agency because both are expected to take responsibility for workplace safety.
OSHA is trying to ensure "temp workers aren't falling through the cracks," said Kaplan, OSHA's assistant regional administrator.
Read more from NJ.com.
Photo Credit: Unite Here Local 26
From Harvard Magazine:
by Marina N. Bolotnikova
Harvard might soon find itself dealing with its largest labor battle in more than a decade, when in 2002 its lowest-paid workers fought for, and won, the right to earn a living wage. Yesterday, the University’s dining hall workers voted 591-18 to authorize a strike, following nearly four months of tense contract negotiations between Harvard and UNITE HERE Local 26, the union that represents the 750-person dining staff. The negotiations will enter federal mediation on September 27; the union plans to strike if a resolution is not reached by September 30. At the center of the union’s demands is a $35,000 minimum salary for employees willing to work full-time (currently, 48 percent of dining hall staff earn less). “Everything hinges on this right now,” said Brian Lang, president of Local 26.
The demand reflects a decades-long disagreement about the status of Harvard University Dining Services (HUDS) staff. Dining hall workers are seasonally employed, the University points out, because most students are away during the summer months and winter break. “Harvard’s dining hall workers currently receive highly competitive wages that lead the local and national workforce for comparable positions in the food-service industry, with the average dining hall worker earning $21.89 an hour,” University spokesperson Tania deLuzuriaga said in statement. Workers also receive retirement benefits and health insurance far more generous than those offered in the commercial food service industry, she added. But because dining hall employees don’t work year-round, incomes are still low: on average, the workers make just less than $34,000, which, according to the MIT Living Wage Calculator, is not enough to support a household of more than one person in the Boston area. Many of the employees work overtime or find temporary jobs elsewhere during the summer to supplement their income, but, the union argues, they shouldn’t have to.
Implicit in the union’s demand for a $35,000 salary are opportunities for HUDS employees to work during the summer months, so that they can work a full-time schedule (defined as 2,087 hours per year) without having to work overtime. Harvard has collaborated with the union to provide such opportunities in the past, but with limited success. Meeting this demand would likely require significant changes in Harvard’s labor structure—which is perhaps what the union wants. At Yale, for example, dining hall staff belong to the same union as workers in other trades, and are able to work year-round by switching among duties. At Harvard, dining hall staff have their own union. (Other universities avoid this challenge by outsourcing dining services to private contractors. But given the centrality of residential life to the Harvard undergraduate experience, the University values a direct relationship with HUDS.)
As the union and its supporters in the Harvard community stress the University’s obligations to its workers, administrators focus on the institution’s finances in an era of seeming modest endowment returns, pressure on other revenue sources, and rising costs in general. It certainly wasn’t a coincidence that Local 26 announced its intent to strike last week, just days after Harvard disclosed that its capital campaign had already raised more than $7 billion, surpassing its goal of $6.5 billion. The endowment, which reached its highest-ever nominal value of $37.6 billion last year, has been central to Local 26’s messaging: “Harvard has broken all fundraising records in the last few years,” Brian Lang said. “In that context, what we’re asking for is small change.” The University, naturally, views its fundraising and endowment resources very differently: “The Harvard Campaign seeks to raise funds around priorities related to the University’s core mission of teaching and learning,” deLuzuriaga said. “In addition, fundraising campaigns by their nature are long-range undertakings in terms of both vision and benefits. The current total includes both gifts and longer-term pledges that are paid over many years; many of these contributions are restricted, invested in the endowment, and will be distributed over time.” And indeed Harvard’s fundraising zeal has come during a moment of lackluster returns on its endowment. Despite gifts secured in the course of the capital campaign, it appears that the value of the endowment, typically announced in early autumn, may have declined in the 2016 fiscal year; last week, MIT reported a nominal investment gain but a net decline in the value of its endowment after distributions for its operations.
University officials describe the union’s proposal for a minimum full-time salary and annual raises, which they say would amount to raises of 40 percent over the next five years, as unaffordable. In response, Harvard has offered a schedule of raises totaling 10 percent over five years. The final result likely will end up somewhere in the middle. Earlier this year, the University’s largest union, the Harvard Union of Clerical and Technical Workers (HUCTW), negotiated raises of about 3.4 percent annually during the three-year life of its new contract.
Alongside its basic income demand, Local 26’s grievances include the University’s proposed health plan, identical to the one that it had negotiated for HUCTW. The plan offered by Harvard would create a new health-care tier for employees earning less than $55,000 (by far the majority of HUDS workers), who would pay the least in monthly premiums. Under the current health-care plan, the lowest tier includes all workers earning less than $70,000, who contribute 15 percent of the cost of their premiums. The sub-$55,000 tier would contribute 13 percent. But Local 26 has rejected the plan because it would also raise copayments substantially: emergency room visits would increase from $40 to $100, and hospital inpatient and outpatient services would increase from no copay to $100. “For people living paycheck to paycheck, an increased copay is a big deal,” said Local 26 spokeswoman Tiffany Ten Eyck. “Workers are afraid higher copays will make taking their children to the doctor a difficult decision or an undue burden.”
According to the University, Local 26 hasn’t made any counter-proposals to the health plan. Union officials respond that Harvard has refused to provide information about health-care utilization that they’ve requested in order to design a plan. “It’s disingenuous to say, ‘We’ve made a proposal and we’re waiting for the union to counter-propose,’ while they won’t give us the information we need to know what’s going on,” said Lang.
Despite these challenges and the threat of a strike, Paul Curran, Harvard’s director of labor relations, said, “I’m optimistic that we can get a contract that’s affordable for the University and that satisfies most of the issues of Local 26.”
The debate over who should be responsible for paying for workers’ health care arose in 2014, when the University introduced deductibles and coinsurance in its plans for faculty and nonunionized staff members. (The plan the University has proposed for Local 26 does not include deductibles.) Nationally, the proportion of employers offering plans with deductibles has risen dramatically in the last decade, reflecting both rapid increases in medical costs and the view among economists that shifting more of the cost onto patients will encourage them to shop around for the best prices and, ultimately, bring down health-care spending. But research on such policies suggests that they haven’t worked very well, and instead have simply encouraged employees to use less health care, even when they need it.
Why have HUDS workers decided to strike now? Lang said that workers have been frustrated with conditions at Harvard for a long time and have simply decided that “enough is enough.” Whatever the precise motivations behind the vote, it appears, for the union, to be auspiciously timed. Students appear more willing now than in the past to view Harvard’s endowment as a tool for ameliorating equality. Ten Eyck confirmed this observation: “Across the campuses we’re seeing widespread student support for the workers that goes well beyond what we imagined,” she said. “Dining hall workers have always known Harvard students support them, but never in numbers so great and with such strong commitment.” The Harvard Crimson, whose editorial board tends to defer to the administration on labor issues, recently urged the student body to support HUDS workers: “[W]e will support HUDS and whatever course of action they pursue in this negotiation process.”
About 200 people attended the dining hall workers’ rally announcing the strike vote last week,according to The Crimson, and about 100 medical and dental students rallied for the union the next day.
Read more from Harvard Magazine.
From The New York Times:
by Michael Corkery and Stacy Cowley
The message to the dozens of Wells Fargo workers gathered for a two-day ethics workshop in San Diego in mid-2014 was loud and clear: Do not create fake bank accounts in the name of unsuspecting clients.
Similar warnings were being relayed from corporate headquarters in San Francisco to regional bankers in Texas, as senior management learned that some Wells employees had been trying to meet exacting sales goals by creating sham bank accounts and credit cards instead of making legitimate sales.
Across the vast retail bank, more “risk professionals” were deployed in efforts to stamp out the illegal activity.
But the bank’s efforts were not enough. Three years after the first false accounts were exposed publicly and the authorities began investigating, Wells, one of the nation’s largest banks, said it was still firing employees over the questionable accounts well into this year.
Some former employees say the explanation is simple: Wells has continued to push the sales goals that caused employees to break the rules in the first place. In fact, the goals at the center of a $185 million civil settlement and investigations by prosecutors in three states are not set to be phased out for another three months.
“They warned us about this type of behavior and said, ‘You must report it,’ but the reality was that people had to meet their goals,” said Khalid Taha, a former Wells Fargo personal banker who resigned in July. “They needed a paycheck.”
In the week since banking regulators and the Los Angeles city attorney announced the settlement with Wells over the illegal sales practices, Wells Fargo executives, including the chief executive, John Stumpf, have denied that the misdeeds were the result of a flawed incentive structure or an aggressive sales culture. In all, 5,300 employees have lost their jobs because of the scandal.
Wells said in its defense that over the last several years it had adjusted its compensation structure to place less emphasis on meeting sales goals and more on other factors like good customer service.
The bank analyzed potentially questionable accounts and employee terminations from 2011 through much of 2015 and concluded that it had made progress in cleaning up its act.
Mary Eshet, a Wells Fargo spokeswoman, said the bank’s analysis of that period showed that the questionable accounts and the terminations had been declining since 2013.
“The steps we have been taking have been effective,” she said. “And we are continuing to do more.”
In interviews, former employees say the fact that the behavior has continued to occur — even if less frequently — shows that the bank has not been doing enough to stop it.
The biggest problem, the former employees say, has been Wells Fargo’s aggressive sales culture, which was nurtured and honed over decades at the bank’s highest levels.
“The branch managers were always asking, ‘How many solutions did you sell today?’” said Sharif Kellogg, who used to work in a Wells Fargo branch in Catonsville, Md. “They wanted three to four a day. In my mind, that was crazy — that’s not how people’s financial lives work.”
One particular branch in the Los Angeles area was held up as a model of employees’ cranking out huge numbers of new accounts. Years before the scandal came to light, retail bankers from other parts of the country used to visit the branch to divine the secret sauce, according to a former bank executive.
The branch was eventually hit with a wave of firings over phony accounts.
Former employees have scoffed at the bank’s suggestions that the sham accounts were primarily the result of bad decisions by unethical workers.
In an online discussion on Reddit this week, former Wells employees swapped grim stories about the dichotomy between their ethics training — where they were formally told not to do anything inappropriate — and the on-the-job reality of a relentless push to meet sales goals that many considered unrealistic.
Mr. Kellogg said he was constantly being hounded by his supervisor to increase his sales, or “solutions,” as they were known.
“I was always getting written up for failing to bump my solutions numbers up,” he said.
Some of his co-workers, facing the same pressure, bent the rules, said Mr. Kellogg, who was making $11.75 an hour when he left the bank in 2012. They would ask local business owners whom they knew well to open additional accounts as favors, saying they could close them later.
“It seems as though you’d have to be willfully ignorant to believe that these goals are achievable through any other means,” Mr. Kellogg said.
“During our training we go through SO much training about ethics and how you CANNOT do that,” another former Wells teller wrote in the Reddit forum. “I got threatened to be fired as a teller with them because I wasn’t meeting my numbers. I told them I didn’t believe in trying to convince someone to spend money they don’t have, get what they don’t need.”
Bank employees were expected to hit sales goals as part of their regular duties. If they hit the goals, it also factored into their yearly bonus. The bank said the goals were only one of several factors used to evaluate an employee’s job performance. But some former employees said they worried that they would lose their jobs if they did not meet them.
Other former Wells employees have vented their frustrations in a series of cartoon videos on YouTube that spoof on the bank’s hard-driving culture — and the fact that they were hardly getting rich from hitting their bosses’ targets. In one video, a cartoon banker drones on: “If tellers and bankers make those sales numbers each day, at the end of the month everybody in the branch will get a $5 gift card to McDonald’s. The district manager will get a $10,000 cash bonus.”
After the practice of creating phony accounts was first reported in The Los Angeles Times in late 2013, the bank stepped up its monitoring and ethics training, former employees said. For its part, the bank said it had caught the behavior and started firing workers before the article appeared.
In San Diego, Mr. Taha said he attended two days of ethics training where employees were shown the difference between valid and improper accounts.
But the problems persisted. Mr. Taha, 28, said he fielded complaints from customers about questionable accounts until shortly before he left the bank this summer. He said bank managers had grown weary of writing up reports on potentially improper sales.
“It was like jaywalking,” Mr. Taha said of the practice of creating fraudulent accounts. “It was hard to police.”
Mr. Taha now belongs to the Committee for Better Banks, an advocacy group that has been petitioning banks like Wells to improve working conditions for lower-level employees.
Customers all over the country have experienced the effects of the questionable sales. Early last year, Walter Mankowski, a 52-year-old computer science researcher who lives in Bryn Mawr, Pa., received a Wells Fargo credit card in the mail that he had not applied for. He essentially forgot about the card until months later, when a $45 annual fee for it turned up on one of his account statements.
“It took talking to three different people at Wells Fargo to cancel it,” Mr. Mankowski said. “I probably spent half an hour on the phone trying to cancel this card I didn’t know about and didn’t want.”
He is not alone. When the Los Angeles city attorney, Mike Feuer, sued the bank in May of last year over the phony accounts, his office received hundreds of calls from Wells customers and employees.
Some of those complaints regarded questionable accounts created only months before the lawsuit was filed.
“Clearly the necessity to fire 5,300 employees shows that there is something that needs to change with Wells internal oversight and with its practices generally,” Mr. Feuer said in an interview.
Some customers — even those who were not victims — agree and are voting with their feet. Darin Grantham, 43, a management consultant who lives in Phoenix, said he planned to close his checking, savings and credit card accounts with Wells Fargo this week — not because he had a bad experience, but because “I lost trust in them” because of the scandal.
Mr. Stumpf, Wells Fargo’s chief executive, has been called to testify at a Senate Banking Committee hearing on Tuesday, and federal prosecutors are considering bringing charges. He has publicly said he feels accountable for what has happened, but he blamed workers for “misinterpreting” sales goals.
Customers like Mr. Grantham aren’t buying it. “They deny it because they don’t want to affect their million-dollar bonuses and jobs, but at some level they had to have an idea,” he said of Wells’s senior management. “When 5,300-plus employees lose their jobs, it’s not just them — they’re the scapegoats.”
Read more from The New York Times.
From The Atlantic:
by Adrienne Green
Americans are working harder than they used to to stay afloat. After adjusting for inflation, the average two-parent household in the U.S. earned 23 percent morein 2009 than they did in 1978. But they did so by working 26 percent more hours. Discounting those extra work hours, wages have remained stagnant for the median family for nearly four decades.
In 2012, 5 percent of workers in the U.S. held more than one job. Linda Estepan is one of them. She works at least 60 hours a week at two jobs to make ends meet: one as a full-time bus cleaner, the other as a part-time cafeteria worker in a high school. I spoke with Estepan about how her cafeteria job is connected to her dream of working in the restaurant industry and how she manages her busy workload. The interview that follows has been lightly edited for length and clarity.
Adrienne Green: What brought you to start working in a school cafeteria?
Linda Estepan: My dream was to be a restaurant owner. I went to school and got an associates degree in hotel and restaurant management. When I graduated, I found out that there were not a lot of jobs out there for that position. The restaurant jobs that they were offering me were minimum wage, so I went to work for New Jersey Transit. I wasn't making enough money at New Jersey Transit to cover my bills, so I end up getting a second job with the school.
I'm a full-time employee at New Jersey Transit. I work 40 hours a week over there. At the school, where I work part-time, it’s 20 to 25 hours a week. I work at the school from 9 a.m. to 1:45 p.m., and for New Jersey Transit I work from 8 p.m. to 4:30 a.m. I sleep when I have time or when I can, and after that you just have to pick up the pieces. Working in the restaurant industry was my passion, and it still is. But I couldn't survive the hours and the money they were paying. I still can’t, so I had to go elsewhere and find another job.
Green: What are your responsibilities at each of those jobs?
Estepan: At the school, I prepare food for the kids and also clean in the kitchen. At New Jersey Transit, I clean buses. I’ve been working these two jobs for five years. I love both my jobs, and I'm making a little bit more money, but I'm barely surviving.
I have an excellent relationship with the students. We're there to serve the food and make sure that they have a nutritious meal at the end of the day, and that they're not at school for eight hours and starving. We have a lot of kids [that have come to school without having eaten]. We have over 100 kids that come for breakfast every day. That's how I started, serving breakfast. I'm a mother myself; some of these kids, their parents are just like me, struggling to make it.
Green: You have two children. What is your work-life balance like?
Estepan: My personal life begins when my work ends. Right now, I pick up my kids from school, make them dinner, and help them do homework. I take my kids to the park sometimes, or to the movies, as much as I can afford. After that, I get ready to go to work.
Green: What do you think is the most challenging and the most rewarding parts of your jobs?
Estepan: The most challenging is feeling like we're not really getting paid enough for the work that we do. The most rewarding is you know that you get up every day and you go and you get to see these amazing kids. With the New Jersey Transit job, it's not that I don't value my job or appreciate my job, but I couldn't say that's my career. I'm sweeping and mopping buses, so I see that as a job. [For my food-service job,] what makes me want to go to work at the school is knowing that I'm actually kind of fulfilling my dream of working in a restaurant.
Estepan: I see my school job as what I want to do, but right now, that is just the way for me to support my family. I don't think that makes me less motivated. Everyday, when you come to work, some way or somehow you have to love what you do. If you don't, it's going to be miserable. I'm not saying I'm miserable, I love the people I work with and when it comes to the school, that's what I envisioned about my future myself when I was in high school. The problem is that we’re working and we can't even feed our family with the money we're making.
Green: How does that make you feel?
Estepan: Unhappy. If you have to support your family at $10.05-an-hour salary and you cannot live in that county where you work, don't you feel like there's something not right in that picture? I grew up in Bergen County, I work in Bergen County, but I don't live in Bergen County because I cannot pay the rent in Bergen County with the money I make. That's the experience of everybody I work with. I'm serving food to hundreds of kids. Meanwhile, I can barely put food on the table for my kids.
Green: Do you feel like people value the job that you do?
Estepan: When these kids come to us and they say thank you, and they appreciate what we do. The kids value our job, but I feel like our employer does not really value our job.
Read more from The Atlantic.
From Monterey County Now:
by Ana Ceballos
For two years, a couple hundred farm workers contracted by Fernandez Farms Inc., through a temporary agricultural worker visa program, were defrauded.
Starting in 2010, workers brought to work at the Royal Oaks-based strawberry farm were forced to pay $125 a month for rent—bunk beds in trailers—even though that was an expense covered with the program. In addition to that, paychecks would routinely come in short to cover administrative costs of the program, a direct violation of the program’s rules, according to U.S. Department of Labor attorney Abigail Daquiz.
Investigators with the U.S. Department of Labor began to sift through records and came up with a long list of issues. Eventually, the department sued the president of the farm, Gonzalo Fernandez, on behalf of the workers in hopes to recoup $1,650 in kickbacks for each of the 249 temporary workers.
On Aug. 25, after two years of court proceedings, Administrative Law Judge Richard Clark ordered Fernandez to pay $2.4 million—$1.1 million of which will go to pay back immigrant and domestic workers—in back wages and penalties. Clark said evidence showed Fernandez engaged in a “systematic and extensive disregard” of the H-2A visa program and when confronted interfered with the investigation by “fabricating evidence and “intimidating the vulnerable employees.” Daquiz says workers testified to being coached on what to say to investigators.
Aside from defrauding temporary workers, Clark found that Fernandez’s actions “deprived domestic workers of paying work.” Five domestic workers, who applied to work at the farm in 2011, were rejected. In that year, 135 temporary workers were financially abused, according to Daquiz.
During court proceedings, at least three workers testified against Fernandez.
“It was incredible to have the workers talk about their experience and see them confront their employer, who had control over them,” Daquiz says. “We want workers to know the Department of Labor is serious about protecting the rights of the farmworkers.”
For Daquiz, one of the important achievements was showing that farmers can also be held liable as individuals and cannot hide behind large corporations. Fernandez, however, has never admitted to any wrongdoing and did not respond to numerous calls for comment for this story.
Read more form Monterey County Now.
Earl Dotter / Oxfam America
From the Wilkes Journal-Patriot:
by Kaitlin Dunn
A representative of a worker right’s organization asked the Wilkesboro Council to require certain things of Tyson Foods Inc. during a public hearing Monday night on the town’s proposed application for a $1.9 million state grant that will help the company expand its local processing operation.
Wilkesboro officials proposed seeking the Community Development Block grant from the N.C. Department of Commerce for designing and building a 100-foot diameter clarifier at the town’s wastewater treatment plant to handle additional wastewater resulting from Tyson’s planned expansion.
Tyson spokesman Worth Sparkman said earlier that if the grant is approved, Tyson will invest over $14 million in improvements and create as many as 75 new jobs at the company’s cooked products plant in Wilkesboro. The grant requires that at least 60 percent of the new employees be from low to moderate income households and that 46 earn more than the county’s average wage.
Hunter Ogletree, a spokesman for the Morganton-based Western North Carolina Workers Center, said Monday night that “to assure that taxpayer money does not support companies that cut corners on worker safety and jeopardize worker safety and health,” the organization was asking the council to require that Tyson do four things.
Ogletree asked that Tyson be required to:
• comply with all safety and health laws and regulations, including letting workers on poultry lines have use of toilet facilities whenever needed;
• fulfill its obligation to provide adequate medical care to workers injured on the job, maintain a first aid station with proper clinical supervision and “refer all injured and ill workers early on to a doctor if symptoms or signs do not resolve.” He also said company emergency medical technicians and nurses “must not operate beyond their legally allowable scope of practice;”
• not be allowed to maintain a policy of punishing workers by giving them points or other demerits if they take sick leave for work-related illnesses or injuries, if they are sick or have a child who is sick;
• maintain a robust safety and health program with management commitment, training and education of workers on hazards, plant hazard identification, employee involvement evaluation and a program to prevent any retaliation against workers for exercising any right under the health and safety laws.
Mayor Mike Inscore said he would bring these points up with Tyson.
Ogletree said the federal government documented that poultry companies significantly under-report injuries that occur on the job. He noted that OSHA fined Tyson over $250,000 for repeat violations of these reporting requirements last month. According to media reports, these violations occurred at Tyson plants in Texas.
“Because of the dangerous and often inhumane conditions at poultry plants, most plants have, unbelievably, between 50 and 100 percent turnover every year among workers,” he said.
Ogletree said government studies and OSHA citations show poultry companies have routinely delayed adequate medical care to injured workers by not sending them to physicians, thereby exacerbating their injuries.
He said many poultry workers then rely on social insurance programs to help them recover from injuries that resulted from unsafe conditions at plants.
Gary Mickelson of Tyson Foods responded to the group’s claims in a statement Wednesday.
“Contrary to the claims made by this group, we’re already committed to providing a safe workplace and treating our team members with respect.
“We’re continually focused on improving our workplace safety efforts. We employ almost 500 health and safety professionals throughout our company who are involved in such areas as safety training, audits, ergonomics and health care. We also have programs and policies to help protect our employees. In addition, we require workers to report any workplace injury or illness, so it can be immediately addressed.
“We believe in treating our team members respectfully, which is why we have a code of conduce, core values and a team member Bill of Rights. We also provide a confidential, toll-free help line for workers to report concerns without the fear of retaliation. If a worker needs a restroom break, we give them one.”
Read more from the Wilkes Journal-Patriot.
Joel Cervantes Macias/Facebook
by Jorge Rivas
Joel Cervantes Macias says he took this now-famous picture of the 89-year-old popsicle vendor because he saw an “elderly man struggling to push his paleta cart.”
“I respect this man to the fullest,” Cervantes wrote when he posted the picture on Facebook.
Response to the photo led to a GoFundMe crowdfund campaign, which has already raised more than $320,000 in retirement funds and made don Fidencio Sánchez the darling of the internet.
At a time when Donald Trump is calling Mexican immigrants drug dealers and rapists, the image of this hard-working Mexican immigrant has become a defiant symbol that challenges hateful stereotypes. The photo also seems to remind people of someone they know, creating an emotional bond that has inspired 15,000 people to donate money to the cause.
But the feel-good story of the month actually speaks to an unpleasant reality: Many aging Latinos don’t have enough money saved for retirement.
Don Fidencio has been pushing his paletas cart up and down the streets of Chicago for the past 23 years. He takes pride in his work, and says he enjoys being outside. But he also told CNN that his body is starting to give out.
“I need to work to pay bills, to pay rent, to buy food,” Sánchez told CNN in Spanish. “And that’s what makes me work.”
He says he plans to keep working for now, but acknowledges that he can’t keep it up forever and says he’s “grateful” that the money he’s getting will allow him to “stop working soon.”
Retirement is a scary and seemingly elusive prospect for many working Americans. You’re never too young to start saving money for retirement. But even the best savings plans can still be outlived as retirees live longer and healthcare gets more expensive, especially in old age.
Further complicating the matter is that young people ages 18-34 are constantly reminded that their generation could make less money than their parents did, and social security could be drained before they reach retirement age.
But perhaps no other group is feeling the looming burden of retirement more than Latinos. For them, the future retirement crisis is already happening.
“The system that is now broken for everyone else has always been broken for Hispanics, and it’s just getting worse for them,” said Monique Morrissey, an economist at Economic Policy Institute, a think tank that researches the impact of economic trends and policies in the United States.
According to a study by the EPI, only 26% of Hispanic families have retirement account savings, compared to 65% of white non-Hispanic families and 41% of black families.
Many older Latinos can never fully retire because they don’t have the savings to do so, according to research from the Economic Policy Institute.
Chicago’s most famous paletero has not talked about his immigration status publicly, but in general the financial security for undocumented immigrants is even more dismal than it is for U.S. born Latinos and immigrants who have legal authorization to live and work here.
While the great majority of the estimated 11 million undocumented immigrants in the U.S. are working age, there is thought to be some 550,000 undocumented immigrants here over the age of 65, according to Mark Hugo Lopez at the Pew Research Center.
One-fifth of adult undocumented immigrants lives in poverty, according to the Pew Research Center. And folks who are struggling to put food on the table every night are not usually saving for retirement.
“Street vendors are living day to day,” said Martin Unzueta, executive director of Chicago Community and Workers’ Rights, a group that works with street vendors. “There are some street vendors who have social security cards, but that doesn’t mean they can send money [for retirement] to the Social Security Administration.”
Read more from Fusion.
From Stand For Security:
by T Albert
The last we spoke, Navy Veteran Fatima Sheikh had filed a wage theft claim with the California Department of Labor Standards Enforcement–for hours worked that her employer didn’t pay her for.
At the time, Fatima was making $11 an hour at Universal Protection Services. She scraped by using money she had saved while in the military and by relying on food stamps and Medicaid.
Fatima filed the claim over unpaid hours during a holiday–“I worked on Thanksgiving, and didn’t get paid at all,” she says. “I filed discrepancy pay paperwork with the company. I sent texts to my manager, who said he’d look into it, but then he stopped responding after the third text.”
It took about four months for her case to reach a decision.
And she won.
“I’m happy I won my case. But I’ll be really happy once the company puts that check in my hand,” she says.
She encourages those in the security industry to stand up and get paid for the hours they worked. “It’s our money so no one should be scared to file these claims,” she says. “It’s not fair if security companies don’t pay what they owe. The companies have the money to pay us. We did the work. So pay us.”
Read more from Stand For Security.
by Rabbi Renee Bauer
One particularly cold December day in 2014 as I tried to warm up my hands after chanting outside a local McDonald’s restaurant with workers striking for $15 an hour and the right to join a union, I wondered what effect this bone-chilling activity would really have. How would protesting with a few dozen people convince the massive corporation to raise its wages? As the director of The Interfaith Coalition for Worker Justice of South Central Wisconsin I was used to speaking out without expectation of a clear, tangible win, and as a rabbi I know from Jewish tradition that it is essential to speak out when we see injustice. But I was cold and tired.
Once my hands warmed up I thought about the faces of the workers who I stood with that morning. Derek stood up and told us that this was the first strike he had ever participated in. “I am doing it for my son,” he shared. “I want him to know when he grows up that his dad was out here. That we are worth more.” I thought about Kyra, a middle-aged woman, who told me why she joined the movement. She said, “They think we are robots. They don’t care about our lives. They think they can pay us late because we are poor and that we can just tell the landlord that the rent is coming.”
By standing with these workers, some of whom are among the 52 percent of fast food workers in the United States who must depend on public assistance to meet their basic needs, my colleagues and I let them know that we care and that their lives and their work matters.
This was enough to make us keep standing with the workers. Our coalition has been an active member of the Fight for $15 since the first strike day in Madison in August of 2013, only nine months after the movement began when 200 workers went on strike in New York City. We bring the religious community out to show solidarity with low wage retail and fast food workers in their struggle to increase the minimum wage by attending rallies, walking workers back to work after they go on strike to avoid retaliation, and bringing workers into congregations to tell their stories.
At that first strike in 2013, we all hoped that this movement would help increase the minimum wage, but $15 an hour seemed like an idealistic fantasy. Now we stand in awe that our demands are becoming a reality. By the end of 2015, policymakers in 14 cities, counties and states had approved $15 minimum wage laws. Earlier this year both California and New York State, where nearly one in five Americans live, passed laws to phase in a $15 minimum wage.
Our voices rising up in the depths of the Wisconsin winter and in the sweltering heat matter. They matter because they speak in chorus with voices from over 150 cities across the country and across the globe.
This Yom Kippur we will read Isaiah’s call:
“Cry from the throat, do not relent, raise up your voices like a shofar, tell my people of their transgressions.” (Isaiah 58:1, 8).
When we hear these words we will know that we can make the prophetic message a reality. And we will know that we must keep raising our voices because here in Wisconsin the minimum wage remains static at $7.25 an hour with a state Legislature that has banned localities from raising minimum wages locally. Wisconsin is now in the minority as 29 states and the District of Columbia have raised their state minimum wages over the federal minimum wage of $7.25 an hour.
Research shows that $7.25 an hour is not a living wage and that raising the minimum wage does not reduce the number of jobs for low-wage workers. It is incumbent upon us to tell legislators of their transgressions, of the moral disgrace of paying people poverty wages. We must keep speaking out in favor of raising the minimum wage until all workers in Wisconsin and throughout the country can support themselves and their families.
On Rosh Hashanah and Yom Kippur we listen to the blowing of the shofar. The shofar says to us “Awake from your slumber and rouse yourselves from yourselves from your lethargy. Scrutinize your deeds and turn in repentance.” (Moses Maimonides). Its piercing sound calls us to take an accounting of our lives and to do teshuvah, to make amends and to set a direction for ourselves for the coming year. This year when we hear the shofar let us hear in it the cry of the workers, like Derek and Kyra, who work hard every day but still live in poverty. And then let us turn their cries into a cry for justice. Let us each raise our voices like a shofar to add to a chorus that is calling for justice here in Wisconsin and throughout the country.
Read more from The Wisconsin Jewish Chronicle.
From Common Dreams:
by Lauren McCauley
Demanding that elected officials and candidates for office embrace morally just policies that include living wages, health care for all, racial justice, and union rights, thousands of workers led by clergy are holding protests at 27 state capitals and Washington, D.C. on Monday.
Dubbed the Higher Ground Moral Day of Action, the demonstrations are being spearheaded by Rev. Dr. William J. Barber II, president of the North Carolina NAACP and architect of the Moral Mondays movement, and accompanied by activists with the national Fight for $15 movement.
At the rallies, which began at 11am EDT, workers, clergy, and community leaders will read and deliver a public policy framework entitled the Moral Declaration, signed by more than 10,000 people and 2,500 faith leaders, to their respective governors, U.S. senators, and candidates for office.
The declaration calls for "a radical revolution of values," in the words of Dr. Martin Luther King Jr., and disputes the prevailing notions of morality in politics.
"We challenge the position that the preeminent moral issues today are about prayer in public schools, abortion, and homosexuality," it states. "Instead, we declare the deepest public concerns of our faith traditions are how our society treats the poor, those on the margins, the least of these, women, children, workers, immigrants and the sick; equality and representation under the law; and the desire for peace, love and harmony within and among nations."
The declaration echoes the rousing address Barber gave at the Democratic National Convention in July, during which he called on Democrats to "shock this nation" as the "moral defibrillators of our time."
The agenda serves as a foil to the vitriol, and what it describes as the "divide-and-conquer strategies," being put forth by "extremist" lawmakers. It seeks to "retur[n] public discourse to our deepest moral and constitutional values," by standing firmly "against systemic racism, classism, poverty, xenophobia, and any attempt to promote hate towards any members of the human family."
As such, the moral platform includes: criminal justice reform, expanded voting rights, "equality in education," healthcare for all, "fair policies for immigrants," "critiquing policies around warmongering," a "just transition away from fossil fuels," and "pro-labor, anti-poverty, anti-racist policies that build up economic democracy through employment, living wages, the alleviation of disparate unemployment."
Read more from Common Dreams.
From The New York Times:
by Stacy Cowley
Workers in New York State who receive their wages on prepaid cards will gain consumer protections next year that advocates say are among the strongest in the nation. The new rules are intended to guarantee that employees do not have to pay any fees to gain access to their paychecks.
An estimated 200,000 workers in the state are paid through debit cards, and activists have for years complained about high fees, concealed costs and other abuses.
Under the new rules, released on Thursday by the New York State Department of Labor, employees who are paid on debit cards must be allowed to make unlimited, free withdrawals from their cards from at least one A.T.M. located “a reasonable travel distance” from their home or work.
What qualifies as “reasonable” will be left to employers and the Labor Department to interpret, according to an official in the administration of Gov. Andrew M. Cuomo. The rules also prohibit a host of incremental fees, including charges for monthly maintenance, account inactivity, overdrafts, checking a card’s balance or contacting customer service.
Companies will have to offer their workers the option of being paid either by cash or check, if they prefer — employers will not be allowed to require that employees accept a payroll card. Federal regulations already prohibit such requirements, but worker advocates say the rule is routinely flouted.
“We’re extremely excited; we think these rules will go a long way in addressing the issues we’ve been hearing about from low-wage workers,” said Deyanira Del Río, co-director of the New Economy Project, a group that has pressed for stricter protections on payroll cards.
The cards are prevalent in the retail and service industries — Walmart and McDonald’s are among the large companies that use them — and card issuers say they can be beneficial for employees who lack bank accounts by giving them a safer, more secure way to store their accrued wages and spend them.
But critics say that the cards are too often forced on low-wage workers, who then see their scant paychecks devoured by hidden or unavoidable fees. A 2014 report by the New York attorney general found that workers at some companies paid fees averaging as much as $20 a month.
At Mr. Cuomo’s direction, the State Labor Department began drafting the new regulations last year after a proposed bill with similar protections died in the State Legislature. The rules are to take effect in early 2017.
“These tough new standards protect some of our most vulnerable New Yorkers from predatory practices that seek to deny them a fair day’s pay for a fair day’s work,” Mr. Cuomo said in a statement.
Business groups say the new rules will increase compliance costs for employers and prompt companies to shy away from using payroll cards. In a comment filed on an earlier draft of the rules, the Business Council of New York State said that most employers viewed the new requirements as “unworkable.”
“It’s a more restrictive rule than we think is necessary,” said Kenneth J. Pokalsky, the group’s vice president. “We’re expecting that this will not be a widely used product in New York after these rules come out.”
Nationally, payroll card use has grown quickly. Around $12 billion in wages flowed through them last year, according to an estimate from the Aite Group.
From The New York Times.