Low Income Employees Losing Income Left and Right

Moneychanginghands Steve Greenhouse over at the New York Times gives us the scoop about an interesting new workplace study by Ruth Milkman, among others:

Low-wage workers are routinely denied proper overtime pay and are often paid less than the minimum wage, according to a new study based on a survey of workers in New York, Los Angeles and Chicago.

The study, the most comprehensive examination of wage-law violations in a decade, also found that 68 percent of the workers interviewed had experienced at least one pay-related violation in the previous work week.

“We were all surprised by the high prevalence rate,” said Ruth Milkman, one of the study’s authors and a sociology professor at the University of California, Los Angeles, and the City University of New York. The study, to be released on Wednesday, was financed by the Ford, Joyce, Haynes and Russell Sage Foundations.

In surveying 4,387 workers in various low-wage industries, including apparel manufacturing, child care and discount retailing, the researchers found that the typical worker had lost $51 the previous week through wage violations, out of average weekly earnings of $339. That translates into a 15 percent loss in pay.

Part of the study’s findings were that employers of low-income workers were successful in intimidating them not to bring workplace claims, including worker compensation claims.

I actually think this study resonates with the current fight between unions and companies over the Employee Free Choice Act and the need for voluntary recognition of unions versus the need to keep secret ballot elections.

Really what this argument is all about is whether you are more concerned about union intimidation or management intimidation in the workplace.  I think, at least in the low income world, this study is further proof that employer intimidation is much more prevalent and impactful.  As someone recently put it to me: there is just something about an employer having the ultimate power of hiring and firing workers.

This Post Has One Comment

  1. Larry A. Johnson

    As the head of the Compensation practice group at an employee rights firm here in Milwaukee, I see this kind of thing walk through the door all the time. Employees working eighty plus hours a week and being paid two hundred dollars in cash – that’s $2.50 an hour without even bringing overtime into the picture. It is the low wage workers working areas where unemployment is high who get taken advantage of the most. Employers say “if you don’t like it, then quit and I can find someone else who will work for the $2.50.”

    The bargaining power between and employee and employer may be equal (or close to it) for most white-collar employees, but when it comes to either unskilled employees and/or low wage employees, it is nowhere near equal. For them, the threat of loosing their job means so much more.

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