Preventing Wage Theft in Illinois
(Editor’s note: due to a technical glitch with this week’s recording, we are presenting an encore presentation of an earlier commentary by Bill Knight)
Illinois has one of the strongest laws in the country with its Wage Payment and Collection Act, which helps workers recover pay withheld from them in so-called wage theft cases and discourages employers from breaking the law. The wage-theft law lets current or former employees file claims against employers for disputes ranging from a last paycheck, earned bonuses or commissions to illegal deductions or lack of compensation for required work.
The state’s Department of Labor’s better enforcement has resulted in fewer claims and higher recoveries from cases pursued. However, (in December) the U.S. Supreme Court heard arguments that could make such enforcement difficult since conservative Justices’ decision could make class-action lawsuits themselves harder.
Scott Lemieux, a professor of political science at New York’s College of Saint Rose, said the case, “Symczyk v. Genesis Healthcare Corp. presents another case in which conservatives on the Supreme Court might erect a barrier making [the Fair Labor Standards Act] harder to enforce.”
Laura Symczyk worked as a Registered Nurse at a nursing home owned and operated by Genesis Healthcare in Philadelphia in 2007, when the employer routinely docked workers’ pay for lunch breaks that were not taken, Symczyk said. Genesis offered Symczyk $7,500 plus fees to settle, but she rejected the offer because she sought standing as a class-action suit involving many workers who lost pay under the practice. Genesis sought to get the lawsuit dismissed because, it said, the offer would have satisfied Symczyk's claims.
Lemieux said, “Class-action lawsuits are absolutely critical. Many workers who have their rights violated lack the knowledge or resources to pursue claims and can also be subject to intimidation.”
Wage theft itself is widespread but mostly unacknowledged. Temporary workers and employees at bullying big-box stores with no job security are especially vulnerable to managers forcing people to work without clocking in, through breaks, or unpaid overtime.
A study by the University of Illinois at Chicago underscored the negative impact of wage theft on more than 300,000 individuals in Chicagoland, plus the overall economy. Researchers found that almost half of the low-wage workers surveyed experienced at least one pay-related violation and that full ‐ time, year-round workers surveyed annually lost more than $2,500 out of total earnings of $16,000, due to workplace violations.
UIC researcher Nik Theodore said that more than $7 million a week is stolen from workers – in the Chicago area alone. The consequences to workers and to the economy include keeping working families in poverty, reducing consumer spending and tax revenues, and forcing responsible employers to compete with lawbreakers.
Previously, employers found guilty of cheating workers over pay they’d earned were liable just for back pay, which meant that employers essentially were keeping workers’ money – even temporarily – as an interest-free loan without permission. Under previous Illinois administrations, said Chicago community organizer Adam Kader, “the state-level Department of Labor was zero percent effective in our experience.”
In Illinois, the state wage-theft law was strengthened in 2010 so workers can now take alleged violations to the state Department of Labor, which has more oversight in dealing with the 10,000-plus wage theft claims it gets each year and a streamlined process to resolve claims of less than $3,000 (most of the cases).
Also, workers will be protected from retaliation and permitted to file suit in circuit court against individuals, instead of their companies, making it harder for employers to escape obligations by declaring bankruptcy. If found guilty, a violator also would have to pay a $250 fine plus interest and victims’ legal fees.
Further, for the first time ever, workers are expressly allowed to file class-action lawsuits against employers.
Anjali Julka, spokeswoman for Illinois’ Department of Labor, said, “The amendment to the [law lets the Department provide an expedited hearing process; enter an enforceable judgment versus a wage demand; and impose statutory damages, fees and penalties.”
According to state records, the year 2010 had 5,600 claims, and $1.7 million was recovered for workers.
In 2011 – the new law took effect that Jan. 1 – 4,700 claims were heard but $1.9 million was collected; in 2012, more than 4,100 cases were heard and $2.6 million was collected. Also, $2,500 in penalties was collected in 2011, and a whopping $70,000 in penalties was collected last year.
Kader, the workers advocate, said, “The law is good, but it’s limited. You need different kinds of community pressure to win those complaints, those lawsuits. Our most heavy emphasis is still on developing and perfecting our direct-action strategies.”
Such strategies could become even more crucial if the U.S. Supreme Court impedes class-action suits.
Bill Knight is a freelance writer. His newspaper columns are archived at billknightcolumn.blogspot.com
The opinions expressed are not necessarily those of Tri States Public Radio or Western Illinois University.