Matthew Fritz-Mauer: The hollow promise of workers’ rights in DC
It might seem like working people in the District of Columbia have a lot to celebrate. In fact, researchers at Oxfam not long ago named DC the most worker-friendly place in the country. Over the past few years, the DC Council has raised the minimum wage, guaranteed paid sick days, and created a paid family leave program.
But despite these accomplishments, there’s something wrong in our city: Employers frequently violate basic workplace laws, and DC is failing to protect workers’ rights. The name of the problem is wage theft, and it wreaks havoc on the lives of working people. Wage theft occurs when a worker is denied the wages or benefits to which he or she is legally entitled. Common forms include not paying minimum wage or overtime, denying paid leave, and failing to pay for all hours worked.
In too many cases, employers steal from their workers. One study estimated that low-wage workers lose 15% of their income to wage theft; another estimated that nationwide minimum wage violations alone cost low-wage workers $15 billion per year. Across the country, millions of people have their basic workplace rights violated every year.
Research commissioned by the DC Department of Employment Services (DOES) estimates that nearly 40,000 workers per year experience minimum wage violations here in DC. Those of us who work with the low-wage community hear stories of wage theft over and over again. My research, which involves detailed interviews with low-income people, found that wage theft is a persistent and devastating problem in their lives.
Wage theft makes it hard to pay rent, buy food, go to the doctor, and keep on the heat and water. Many workers feel angry, depressed and helpless over it. For some, the strain becomes too much, and they think about or even attempt to die by suicide. Wage theft weakens families and communities, strains the social safety net, and makes it hard for legitimate employers to compete against companies that cut costs by defrauding employees.
How can this be the case? In 2014, DC passed a law specifically designed to attack wage theft. The Wage Theft Prevention Amendment Act increased civil and criminal penalties, expanded the authority of DOES, incentivized lawyers to take on claims, and issued a clear statement about our city’s values. It is one of the most robust and progressive anti-wage theft laws in the country.
But that law is, in many ways, failing.
Today, workers who suffer wage theft have four options: They can go to the DC Office of the Attorney General (OAG), find a private lawyer, file a lawsuit themselves, or file a wage-theft claim with DOES. Realistically, though, DOES has to be the primary enforcer of basic workplace laws. Both the OAG and private-sector attorneys have increased enforcement activities, but resources are limited. The vast majority of people can’t get a lawyer to represent them, and filing a lawsuit on their own is too intimidating and confusing. Going to DOES should be a quick, easy and effective way to fight back against wage theft. In reality, it’s anything but.
There are three crippling problems with DOES. First, it misses the vast majority of wage theft that occurs. While almost 40,000 people in DC are paid less than minimum wage each year, fewer than 100 of those go to DOES for help with their minimum wage violations, according to data recently obtained through a DC Freedom of Information Act request. By the government’s own numbers, DOES never finds out about more than 99% of minimum wage violations.
The big issue is that DOES uses a passive, complaint-based system. Instead of proactively looking for wage theft, it waits for people to come through the door. The problem is that hardly anybody does that. We know that wage theft is common, but the agency gets fewer than 700 complaints about it each year. For tipped workers, the agency’s tip portal requires employers to report their wages on a weekly basis, which catches some additional violations, but this approach does not collect information on the vast majority of DC’s low-wage workers.
Second, workers who do file claims report significant problems. In the case of one woman I spoke with, the claims examiner repeatedly lost her documents, ignored her messages, and got basic facts wrong about her claim. Delays are also common, according to the response to my FOIA request. It takes about 51 days for the agency even to serve employers with a complaint. Worst of all, retaliation complaints languish. Despite the pressing need for quick action, it takes the agency almost four months to resolve them, including six weeks to contact the employer. By the time the agency acts, the harm has already been done.
Most egregious of all, DOES imposes inadequate judgments and collects very little money. In DC, employers who admit to wage theft must pay workers liquidated damages equal to 100% of unpaid wages; those who don’t admit it and lose must pay liquidated damages of 300% of unpaid wages. Few employers admit their wrongdoing. Instead, most fight back or ignore the agency.
Adding insult to injury, DOES isn’t imposing damages on employers found guilty of wage theft. In fiscal year 2019, the agency found employers owed about $483,000 in unpaid wages, but only $451,000 in liquidated damages — just 93% of unpaid wages, according to the FOIA response, even though workers are normally entitled to 300% of unpaid wages as liquidated damages. Worse, the agency hardly collects for workers. Last fiscal year, it recovered money equal to only 40% of assessed wages and just 15.5% of assessed liquidated damages.
Let’s summarize: DOES misses the overwhelming majority of wage theft. The claims process is slow and error-filled, and in the end, DOES doesn’t seriously sanction employers or collect much money. There’s not much reason for bad employers to fear the consequences of violating the law.
But there is a better way.
DOES must change its enforcement strategies, and that starts with understanding that wage theft is a serious social problem that requires a robust public response. The agency must adopt a long-term mindset and think carefully about how best to use its limited resources to create change. This will involve moving away from a complaint-based system and conducting targeted, proactive investigations in the most theft-ridden industries, including construction, service and retail. DOES must meet workers where they are, react quickly, meaningfully punish bad employers, and publicize its actions to send a clear message. Most importantly, it should use the energy, resources and knowledge of those in the workers’ rights community who know where wage theft is happening and want nothing more than to help the government enforce fundamental workplace rights.
These techniques have been successful before, including in California and in President Barack Obama’s Department of Labor. By adopting new strategies, especially targeted inspections, California has been able to uncover more violations and collect millions more in unpaid wages and penalties for workers. Implementing these changes here in DC won’t be easy, but one thing is clear: DOES is failing the people who need it the most, and to change nothing would be the worst choice of all.
Matthew Fritz-Mauer is a labor and employment attorney and a member of the Just Pay Coalition. He recently finished his doctoral research on wage theft among low-wage workers in DC. He may be reached at matt.fritzmauer@gmail.com.
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