Bad economy sparks more complaints of wage theft

More workers are getting stiffed just when they need their pay the most.

Complaints of wage theft have risen as the economy tumbled. Allegations range from underpayment to not getting paid at all.

"It's definitely on the rise nationally because of the economic crisis," says Ted Smukler, public policy director of Interfaith Worker Justice, a Chicago organization that advocates for better wages, benefits and working conditions. "Employers are desperate to shave corners when their profits are going down, and some are just greedy."

Wage theft is most common among low-wage earners and day laborers, he says. It affects non-immigrants and immigrants, legal and illegal.

Last year, the Department of Labor collected $57.5 million in back wages for 77,000 workers in industries such as agriculture and garment making. The year before, it collected $52.7 million.

In Austin, the Workers Defense Project received 63 complaints in June, compared with 25 it had in June last year, policy advocate Emily Timm says.

Workers are desperate, she says. "They're sticking with jobs when they're not getting paid because they know they're going to have trouble finding another job," she says. "They're holding onto hope that the employer will come through and pay them in the end."

Chicago's Working Hands Legal Clinic has been getting more complaints from construction, restaurant, janitorial and other workers, Executive Director Chris Williams says. It got 252 in the first half of the year, compared with 161 in the same period last year.

Most are immigrants, he says. The U.S. Labor Department says illegal immigrants are covered under minimum-wage and overtime laws.

"We do a lot of work with workers at temporary staffing agencies, people who work maybe 32 hours but they're only getting paid for 26," Williams says.

The Cincinnati Interfaith Workers Center, which helped workers collect $200,000 in wages last year, already has collected $160,000 this year, director Don Sherman says.

He expects the total to surpass last year's because the center is currently helping 50 workers who allege wage theft, including a man who says he is owed $34,000 for two months of stone- and concrete-laying work he says he wasn't paid for and more than a year's worth of overtime.

Most are illegal immigrants, who are vulnerable to abuse because employers can threaten to report them, Sherman says.

"We've seen a remarkable increase," he says, citing a growing problem of contractors who underbid on jobs, then make up the difference by cheating workers. "They're going to take whatever money is left over for themselves and not pay the workers," he says.

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