Labor Dept. Mishandled Worker Complaints
Of Cheating on Overtime and Unpaid Wages

The Wage and Hour Division of the U.S. Labor Department mishandled or ignored complaints by workers of being cheated by their employers for overtime pay and minimum wages, as required by federal law. The Government Accountability Office (GAO) strongly criticized the Division in two reports last week, noting that its agents had either dropped workers’ complaints on their own or delayed investigating hundreds of cases a year or more after they were filed.

The GAO also rebuked the wage-hour agency for sharply reducing the number of enforcement actions each year and for not focusing on low-wage industries where most violations of the law are likely to occur. In fiscal 2007, the division pursued 29,584 cases of employer violations, down 37 percent from the 46,758 enforcement actions 10 years ago.

“Although the Department of Labor currently has the necessary tools to fight wage theft, the GAO investigation suggests that the problem of wage theft is only getting worse, because of weaker enforcement,” said Rep. George Miller (D-Cal), chairman of the Education and Labor Committee, at a House hearing.

The accountability office said that it found more than 100 cases that were closed because the wage division could not locate an employer, and 350 cases that were assigned to an investigator more than a year after the complaint was received. It inappropriately rejected complaints based on incorrect information provided by employers, failed to make adequate efforts to locate employers and did not thoroughly investigate and resolve complaints about unpaid wages.

In responding to the harsh criticism of its performance, the Wage and Hour Division boasted it had collected $220,633,703 in unpaid wages in 2007, compared with $96,719,308 a decade earlier. It said that a total of 341,624 employees received back wages in 2007 and that the amount per case was $10,500 in 2007, more than double the $5,400 in 2000.

Does Labor Dept. Bias Toward Employers Encourage Cheating?

Critics of the Labor Department have noted that inspectors generally give employers time to correct violations of labor laws on a voluntary basis rather than follow strict enforcement procedures. This is now true in its operation of the Occupational Safety and Health Administration (OSHA), where there is a policy of giving employers advance notice to correct their own violations voluntarily before being cited by OSHA.

Elaine Chao, whom President Bush appointed as Labor Secretary, has used her authority to dismantle and undermine basic labor laws and programs. She became a strong advocate of legislation aimed at depriving millions of workers of overtime pay for extra hours worked if employers could classify those workers as supervisors. Her husband is Mitch McConnell, Republican Senate Minority Leader.

It is worth noting that even with the relatively benign attitude toward corporations, the Wage and Hour Division was able to reimburse 341,624 workers for their unpaid wages, based on employer violations of the federal law. One can imagine the tens of thousands of workers whose complaints about “wage theft” never reached the Labor Department. That employers had to cough up more than $220 million in one year shows to what lengths they will go to avoid treating their employees fairly, as well as disrupting a union organizing campaign.

Under Chao’s administration, corporations get preferred treatment. The case against them can remain unsettled for as long as two years or more. If they are caught violating the law, all they have to do is pay the workers their back wages and promise to put them back on the job. No financial fines or business restrictions are imposed on them. They are free to try to cheat workers again—and this time, maybe get away with it.

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