Bill to stop wage theft advances in Minnesota House

Supporters of House File 6, a bill to crack down on wage theft, staged a press conference at the Capitol.

A labor-backed bill to protect Minnesota workers from wage theft advanced out of its first committee hearing at the Capitol today. The bipartisan measure would crack down on employers that don’t pay workers what they are owed – and create an even playing field for employers that do.

“Those good employers are getting burned by these criminals – and that’s what they are,” said Rep. Tim Mahoney (DFL-St. Paul), the bill’s lead author and a member of Pipefitters Local 455.

Working people nationwide lose billions of dollars to wage theft each year. They include an estimated 39,000 workers in Minnesota, according to an estimate from the state’s Department of Labor and Industry.

CTUL, a worker center based in the Twin Cities, has helped workers recover over $2 million in lost wages in recent years.

Wage theft can take a number of different forms. Employers who fail to comply with minimum- or prevailing-wage laws commit wage theft, as do employers who don’t pay overtime.

Sometimes, wage theft is obvious, as it was when Lakeville Motor Express abruptly shuttered its Roseville terminal in November 2016, claiming it had no money to pay 95 members of Teamsters Local 120 for their prior two weeks of work.

The same thing happened in 2014 to Robin Pikala, a personal care assistant from Fridley and member of SEIU Healthcare Minnesota. She was among 800 workers who lost a combined $1.4 million when Crystal Care, one of the largest in-home service provider in Minnesota, filed for bankruptcy – after stringing employees along without pay for 45 days.

“Wage theft is real, and it’s hurting too many families in our state,” Pikala said at a press conference staged in advance of today’s committee hearing by the Minnesota Coalition to End Wage Theft, which includes several of the state’s largest unions.

Other workers who spoke at the press conference described how wage theft can be embedded within an industry’s culture, or built into a complicated web of workplace relationships, like construction workers misclassified “independent contractors” to circumvent wage and benefit standards.

“In the restaurant world, wage theft isn’t the exception,” Kevin Osborn, a line cook in Minneapolis, said. “It’s the norm.”

Osborn said it’s “standard procedure” for cooks to set up their workstations before punching in and continue cleaning them after punching out. Sometimes employers will move hours around between pay periods to avoid paying overtime, he said; other times they don’t bother paying at all.

And if a worker complains? “We don’t call it retaliation,” Osborn said. “We call it getting your hours cut.”

New penalties for employers who retaliate against employees, commit wage theft or deny workers access to their payroll information are among the provisions of Mahoney’s bill, House File 6. In addition, the bipartisan measure would require uniform payroll record keeping, and empower the Department of Labor and Industry to subpoena those records if a worker brings forth a wage-theft claim.

Mahoney has 34 co-authors on House File 6, although there is currently no companion bill in the Senate.

House Majority Leader Ryan Winkler, who attended the press conference, said addressing wage theft was a top priority in the DFL caucus. Winkler said he is confident the measure would pass the House, potentially as part of a larger “omnibus jobs bill.”

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