To fight wage theft California gets strong assist from worker centers

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Annelisa Luong met with the Kome Japanese Seafood & Buffet employees in secret to talk about their sub-minimum wages and lack of overtime pay.

She convened clandestinely with cooks and dishwashers. Sometimes they met at a McDonald’s, other times at a transit stop and other times in workers’ homes.

“Here is an opportunity,” she recalled saying. “The state is investigating. You actually have the opportunity to speak up.”

Her efforts worked. Workers cooperated with the state’s investigation of Kome, a popular San Francisco Bay area restaurant, and in 2018 the labor commissioner issued $5.16 million in citations alleging wage theft by the employer. The restaurant ultimately closed, but its owners settled without admitting fault in August 2020, eventually paying $2.6 million to 133 workers.

The probe was the outcome of the state’s partnership with the Chinese Progressive Association, a San Francisco nonprofit that employs Luong and has organized working-class immigrant Chinese families for 50 years.

The investigation also is part of a broad strategy the state launched six years ago to work alongside 17 labor-friendly organizations, most of them worker centers — nonprofit community hubs that advocate for low-wage workers. The state calls its collaboration with the groups the California Strategic Enforcement Partnership.

Labor experts say the partnership is one of the state’s most proactive responses to wage theft. By convincing groups of workers to testify in an investigation, the partner groups help the state target prominent employers and seek large repayments for workers, despite legal fights that are long and drawn out, state officials said.

“We’re going after bigger companies, and we have multiple defendants,” Labor Commissioner Lilia García-Brower said in an interview. “They have a lot to protect, right? And so they’re coming in with their A-game to defend themselves against these multimillion-dollar citations.”

Community connection

Wage theft — the failure of bosses to pay workers what they are owed —  frequently occurs in low-wage industries. The state partners with worker groups that operate in such industries as restaurants, janitorial services, construction and residential care.

These labor groups have referred investigations resulting in citations against 50 businesses, a state spokesperson said.

Among the major wage theft cases involving these partnerships was an $11.9 million labor commissioner citation against RDV Construction in Los Angeles, $8.5 million in citations against elder care facility Adat Shalom Board & Care, also in Los Angeles, and more than $4 million in citations against two janitorial companies employed in California by the Cheesecake Factory, as well as the chain itself. On Friday, a labor commissioner spokesperson said the agency had reached a tentative settlement in the Cheesecake Factory case, but did not immediately provide details.

Business groups are divided about the strategy. The California Chamber of Commerce said it allows the Labor Commissioner’s office to target bad actors.

Another group, the California Business and Industrial Alliance, said the partnership strategy blurs the line between regulator and state.

Before Gov. Gavin Newsom appointed her labor commissioner in 2019, García-Brower was executive director of one of these labor organizations, Los Angeles-based Maintenance Cooperation Trust Fund, a nonprofit that advocates for janitorial workers. It is funded through union contracts and is assisting workers in the Cheesecake Factory case.

As with other wage theft cases, staffing shortages in the Labor Commissioner’s office and the pandemic are slowing the state’s strategy. The citations take months and even years to resolve. A state database of the partnership’s 50 cases shows the agency has collected 14% of the wages cited — though the number may be higher as some settlements are still being paid out.

Even so, García-Brower says, the partnerships are necessary to help the state enforce the law.

“They have a connection to the community that the state won’t be able to build in time,” she said.

Read the full article at CalMatters.