City looks at the wage theft issue

On May 15, 2013, in Latest News, by The Somerville Times

By Linjing Cheng

Representatives from Centro Presente and others made their grievances known to members of the Somerville Board of Alderman regarding alleged “wage theft” practices by local employers.~Photo by Linjing Cheng

Representatives from Centro Presente and others made their grievances known to members of the Somerville Board of Alderman regarding alleged “wage theft” practices by local employers. –Photo by Linjing Cheng

Four wage dispute cases between One World Cuisine – which operates Diva Indian Bistro in Davis Square, as well as a number of other restaurants and liquor stores – and its former employees developed into a political discussion in Somerville this week.

Community organization Centro Presente’s organizer Patrick McDermott, who helped file the complaints and organized pickets and petition campaigns, made his debut testimony in front of the Board of Aldermen at their special meeting on Tuesday night. It was the first meeting discussing an ordinance that aims at deterring the wage theft issue since Mayor Curtatone’s April proposal.

It was the first time, too, that the city delved into the legislation covering the wage issue that has been dealt by the state and federal government. The ordinance that McDermott was hopeful to see it pass would be quite a task for the Board of Aldermen.

The passage of the ordinance would allow the city, its boards or commissions, to revoke or suspend the licenses of the violators of the state’s wage law, and the federal’s Fair Debt Collection Practices Act.

In the realm of administrative enforcement, it’s up to the U.S. Department of Labor and Attorney General’s office to enforce their laws respectively. The city has been in a role of assisting the state and federal in the unpaid-wages issue by reporting the disputes to them.

It’s still unclear at the moment as to which entity would be enforcing the ordinance if it passes, or even investigating the cases, as the language of the ordinance has yet to be discussed at the board, with a second hearing later this month.

Alderman at Large John Connolly stated his concern after the first hearing, “The trouble is, the state and federal governments already have department to deal directly with this, and how much enforcement capability the city would have.”

The U.S. Department of Labor declined to comment on the draft.

Jackie Rossetti, the mayor’s Deputy Director of Communications, referred to the Licensing Commission as possibly enforcing the ordinance after the passage. The commission regulates – as shown in their booklet Rules and Regulations – alcohol, restaurants, inns, package stores, various fields of construction, landscaping, painting, and domestic services. The back wage issue was never a city’s issue. The city can withhold a license, but they never revoke them.

“I think what really makes the businesses think twice about not paying workers is the threat of having their abilities to do businesses taken away,” said McDermott.

McDermott reported that workers came to him because they were fired, and he learned about the underpayment issue as he asked more questions. The wage issue oftentimes relates to immigrant families.

The state’s minimum wage is $8 per hour, and the workers should be paid 1.5 times that for overtime labor. Typically, McDermott and his colleagues negotiate with the employers for restitution. When the violators refuse, they file complaints to the Attorney General’s office or U.S. Department of Labor. Sometimes they resort to the state and federal courts.

Davis Square resident Rand Wilson, who has been helping to collect signatures in support of the hearing, thinks the community organizations aren’t within the reach to many. “Our weak labor laws, vicious employer opposition and the growth of part time, subcontracted and temporary employment puts many employees outside the reach of labor protections,” said Wilson at the hearing.

The owner of Diva Indian Bistro, Jaswinder Singh Pabla, was also at the hearing. His restaurant on Davis Square was the focus of McDermott and Wilson’s picketing last July and August.

Diva’s parent company, One World Cuisine, which is owned by the Singh/Pabla family, refused to settle out of court. Plaintiff Cruz Manuel Melgar had to file the case in United States District Court of Massachusetts, as the Statutes of Limitations applied and it was too late to resort to the Attorney General.

As McDermott recalled, the Department of Labor didn’t get to investigate it. Centro Presente helped Melgar, along with other six workers, to file four suits in federal court for $183,500 in unpaid wages, minimum wage and overtime violations in October 2012. That is the case that inspired the draft of the ordinance.

To some people, filing a complaint to the administration is not that efficient. The U.S. Department of Labor Wage and Hour division, which enforces the Fair Labor Standards Act, has investigators answer phone calls, screen, and then register complaints. Assistant district director of the division Carlos Matos said, “We have to make sure our resources are used in the right way.”

As for punitive actions, Matos said that in the majority of the cases, the employers are asked to pay the back wages that go back two years, or three years if the violator is willful, although a civil monetary penalty can be assessed.

It took less than a month since Centro Presente and their ally Rand Wilson, who worked as union organizer for three decades, gathered 191 signatures required by the Board of Aldermen to hold this hearing. Meanwhile, upon learning about the passage of an anti-wage-theft ordinance in Chicago in January, Wilson sent Mayor Curtatone a copy of the unanimously passed ordinance.

“He liked it,” said Wilson. A fresh draft of the ordinance for Somerville was already in the Board of Alderman and audience’s hands while Wilson and McDermott presented a spreadsheet listing 19 violators with a total $121,868 back wages and $20,844 in fines, which Wilson referred to as “the tip of the iceberg.”



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