Tuesday, March 24, 2009
Steven Greenhouse (NY Times) has a story on a recent GAO audit of the Department of Labor's Wage and Hour Division. The bottom line is not pretty. The GAO found widespread failure in the division's handling of wage and hour cases; although I knew there were problems, some of the findings made my jaw drop. Among them, according to Greenhouse:
In a report scheduled to be released Wednesday, the Government Accountability Office found that the agency, the Labor Department’s Wage and Hour Division, had mishandled 9 of the 10 cases brought by a team of undercover agents posing as aggrieved workers. In one case, the division failed to investigate a complaint that under-age children in Modesto, Calif., were working during school hours at a meatpacking plant with dangerous machinery, the G.A.O., the nonpartisan auditing arm of Congress, found. . . .
“This investigation clearly shows that Labor has left thousands of actual victims of wage theft who sought federal government assistance with nowhere to turn,” the report said. “Unfortunately, far too often the result is unscrupulous employers’ taking advantage of our country’s low-wage workers.”
The report pointed to a cavalier attitude by many Wage and Hour Division investigators, saying they often dropped cases when employers did not return calls and sometimes told complaining workers that they should file lawsuits, an often expensive and arduous process, especially for low-wage workers.
During the nine-month investigation, the report said, 5 of the 10 labor complaints that undercover agents filed were not recorded in the Wage and Hour Division’s database, and three were not investigated. In two cases, officials recorded that employers had paid back wages, even though they had not. . . .
The accountability office also investigated hundreds of cases that it said the Wage and Hour Division had mishandled. In one, the division waited 22 months to investigate a complaint from a group of restaurant workers. Ultimately, investigators found that the workers were owed $230,000 because managers had made them work off the clock and had misappropriated tips. When the restaurant agreed to pay back wages but not the tips, investigators simply closed the case. In another case, the accountability office found that workers at a boarding school in Montana were not paid more than $200,000 in overtime. But when the employer offered to pay only $1,000 in back wages as the two-year statute of limitations approached, the division dropped the case.
Secretary of Labor Hilda L. Solis said she took the report’s findings seriously. . . . Ms. Solis said the Wage and Hour Division planned to increase its staff by a third by hiring 250 investigators — 100 of them as part of the federal stimulus package — “to refocus the agency on these enforcement responsibilities” and “ensure that contractors on stimulus projects are in compliance with the applicable laws.” . . .
The report concluded that the Wage and Hour Division had mishandled more serious cases 19 percent of the time. In such cases, the accountability office said, the division did not begin an investigation for six months, did not complete an investigation for a year, did not assess back wages when violations were clearly identified and did not refer cases to litigation when warranted. . . .