Tuesday, March 24, 2009

DOL's Wage & Hour Unit Found To Be Failing

DOL 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. . . .




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It is too bad that people do not understand in advance what terms like "Smaller govt" and "do more with less" and "cutting budgets" really mean to an agency like WH which spends 98% of its annual budget on salaries. It means: no one to answer your calls, no one to investigate your complaints and no resources to go after bad actors.

Posted by: Brooke | Mar 25, 2009 10:49:54 AM

Some of this is due to a failure to conduct investigations and to prosecute. Investigations and litigation costs money. Where was Congress, GAO and the NY Times when the agency went from 1250 WH Investigators in 1997 to the 740 it now has? Where was the concern when additional laws were given the agency to enforce like The Family and Medical Leave Act, and the Immigration and Nationality Act without additional resources to do so? Where was the public outcry when the Bush Administration packed this agency and many others in government with lobbyists from the very industries those agencies were charged to regulate? Is there any wonder this agency and many others in the federal government are demoralized? Blaming the dedicated folks in Wage and Hour for the failures of their leadership does them and our nation's workers a disservice. It is time to get serious about addressing the problems of this agency by listening to the folks who remain and have run it quite well for so many years. They have the will and expertise to restore public faith in this department and given the chance and the resources....they will.


Posted by: JP | Mar 25, 2009 12:21:01 PM

In the "glass-is-1/8-full" view....this is the latest, necessary investigation uncovering the consistent, ongoing horrors of the past eight years. In order to move forward, we need to document what has happened AND THEN link it to countless other anti-regulatory, anti-enforcement disasters that almost everyone is paying for now. At least the information is emerging out of the shadows...

Posted by: David Yamada | Mar 25, 2009 9:38:51 PM

Does anyone find it interersting that on the same day that GAO & ABC News aired this story that the DOL announced the hiring of 250 new investigators? Are we to believe that these entities were not actually in discussion about this as a way to get public outcry so that Congress could easily justify their vote? Looks like they were in active concert. There was no mention of DOL's strong response to this same GAO stuff last summer. This is the new media-government complex we are seeing. Brought to you by the same media that got Obama elected in November. It sets a dangerous precident.

Posted by: JuanGarcia | Mar 26, 2009 7:36:35 PM

"I have filed a complaint against my employer reagrding back wages and they have already accepted their mistake to DOL investigator, but for some unknown reason DOL investigator has not requested the back wages or I have not received my back wages and after numerous follow ups with DOL investigator I always get a reply that they are going to let me know the update, which has started me thinking if the agent has been playing with me or misleading, even I have been asked to file lawsuit agaisnt the employer by DOL, which I have questioned DOL why should I file a lawsuit when employer has already accepted their mistake with them and they should be asked to pay the backwages. "
Now after reading this above article which I found on google, it is making me think that have I become a victim of another DOL 9 out of 10 case?
Can anyone advice what I can do to make sure that my case has been handled properly, can I report my concerns to any other department?

Posted by: Amigo | Aug 30, 2009 10:25:43 AM

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