Shortchanged: An in-depth look at wage theft
A former employee of LaMac Cleaners in Lynnhurst and Tangletown went to court this month asking for thousands in overtime pay she said she was shorted over the course of five years.
“We knew that we were entitled to it, but out of need we never said anything,” said the woman, who spoke through a translator and requested not to print her name.
Since taking a different job, she’s brought hundreds of pay stubs in to Centro de Trabajadores Unidos en la Lucha (CTUL), the nonprofit that translates as The Center of Workers United in Struggle. She showed the court pay stubs that initially list all hours paid at one rate — 97 hours in a two-week pay period at $12 per hour, for example. Later pay stubs document 80 hours per pay period, she said, with her overtime hours switched to a separate line item called “Commissions” also paid without a time-and-a-half rate.
LaMac owner Nugzari Zedania said the allegations are “not right,” and declined to discuss the issue.
“We did pay commissions, vacations, everything,” he said.
A judicial officer determined April 15 that the employee is entitled to a judgment of more than $4,000.
The woman said she wants to see more workers fight for what they are owed.
“I did something so that people stop abusing us workers,” the woman said. “Us immigrant workers, we come here to struggle, to progress, to not stay on the bottom. That’s why we work so hard, to get ahead and to have something in life, but sometimes you can’t.”
“So many stories”
CTUL reports that its recent survey of 173 Twin Cities workers in low-wage industries found that half of respondents experienced wage theft.
A 2008 survey of more than 4,000 workers in low-wage industries in Chicago, Los Angeles and New York City (funded by the Ford, Haynes, Joyce and Russell Sage Foundations) found that more than two-thirds of respondents experienced at least one pay-related violation in the previous work week. Twenty-six percent of respondents were paid less than minimum wage, and 76 percent were not paid overtime rates.
Lyndale resident Irene Gomez said she was paid a flat monthly rate for cleaning work in Minneapolis, and when she did the math, she realized she was only making $2-$3 an hour.
Her son Javier Martinez said his paychecks bounced last year while he worked for a subcontractor cleaning P.F. Chang’s at Southdale Center. When he pursued the matter, he said he learned the contractor Coast to Coast went bankrupt and closed, and said he lost nearly $4,000 in wages.
A spokesman for P.F. Chang’s did not respond for comment, and Coast to Coast could not be reached for comment.
“There are so many stories, and everybody has one,” Gomez said through a translator. “It feels like discrimination to me.”
While Gomez was discussing the issue at a Lake Street shop, a passerby stopped to listen and shared her own story. The Whittier resident said she was owed $600 or more from Las Mojarras Restaurant on Lake Street. She found another job and encountered the same issues there, she said through a translator.
Las Mojarras did not respond to voicemails for comment.
“Big stores or small stores, they do the same thing,” Gomez said.
“They take advantage of people who don’t have documents, and they use that to intimidate you,” said the Whittier resident. “They say, ‘If you speak, then I’ll speak. If you speak about me not paying you, I’ll speak about your status.’”
“Many of us are afraid,” Gomez said. “Sometimes I think it’s my right, I’m not doing anything wrong. I’m not stealing … I just want my money that I worked for.”
Bryant resident Jose Gomez’ paychecks for construction work bounced so frequently, bank staff said they would call the police if it happened again, according to CTUL Organizer Terin Mayer. Gomez is preparing to seek nearly $7,000 in payment from Parada Roofing & Remodeling for work in 2015.
Enoc Parada Garcia could not be reached for comment.
“This is such an important issue for our clients and the entire community,” said Martha Delaney, deputy director of the Volunteer Lawyers Network, in an email. “When people aren’t paid their wages, they can sink into homelessness (which is difficult to recover from) and even be pushed on to public assistance. People who steal from those in poverty are stealing from our community as a whole, not just the people who suffer directly.”
One man’s wage war
Willard-Hay neighborhood resident Dameon Jones said weeks without pay from his employer had a major impact on his life — he was facing eviction, and he was involved in a custody battle over his son at a time when lost wages meant he couldn’t pay the bills. He said he worked for Jamek Engineering beginning in 2012 at projects including the Jackson Flats in Northeast and the Emanuel Housing project near the Vikings stadium.
When Jones renewed his personal business certification, a city compliance officer alerted him that he was eligible for prevailing wage pay, significantly more than what he was making at Jamek, according to a determination by the Minneapolis Department of Civil Rights. Under the law, contractors and subcontractors must pay the prevailing wage for projects that use more than $2,000 in federal funding.
Jones said his boss refused to pay him unless he signed an affidavit affirming that he was properly paid. So Jones said he signed the affidavit.
“At that time, I really needed the income. They still made me wait several weeks before they gave me money,” he said.
Jones said he dealt with other issues that made him uncomfortable. The hours on his time sheet were changed, he said. On one occasion, he said Jamek owner James Ekhator watched him cash a paycheck at the bank and asked for $300 back, saying he paid Jones too much.
“I started keeping track of everything I was doing,” Jones said. “I would take pictures of my time sheets and checks.”
When asked about the allegations, Ekhator said he’s had issues with Jones. He pointed to a 2013 police report he filed for a paint sprayer Jones allegedly did not return. He also pointed to a judicial decision in May 2014 that determined Jones was not eligible for unemployment benefits after leaving Jamek, under the reasoning that Jones did not quit for a good reason caused by the employer.
U.S. Department of Labor spokeswoman Rhonda Burke said there is an open investigation of Jamek Engineering involving alleged violations of prevailing wage laws. Additional investigations into Jamek concluded in July 2014 and ordered payment to Jones and other workers for back wages owed, she said.
The Minneapolis Department of Civil Rights (MDCR) awarded Jones findings of probable cause in 2015 for employer discrimination and retaliation, and ordered a $20,000 judgment in Jones’ favor last March. According to the MDCR investigation, bank statements show Jones was paid thousands of dollars less than a Caucasian painter on the same job site, and Jones was paid on a less regular basis. MDCR also determined that Ekhator’s police report was filed less than a week after Jones filed a discrimination complaint with the city, at a time when Ekhator knew Jones had the sprayer.
Jones said the experience has been discouraging.
“I’m scared to get back into the field, because I don’t know if I’m going to come across a guy like that,” he said.
He said he hasn’t been able to collect funds awarded in the MDCR ruling.
A challenge to collect
Minneapolis resident Cecilia Guzman is still owed thousands awarded in Hennepin County District Court for a job cleaning an Uptown apartment building, said Mayer of CTUL. Court records indicate that a writ of execution to secure $4,570 in back pay was unsuccessful, because HD Cleaning LLC had closed its bank account. The court recently agreed to order the company to file a financial disclosure form.
HD Cleaning could not be reached for comment.
Glen Drew, resource attorney at the Volunteer Lawyers Network, said he sees many employees left without pay when a restaurant or business closes. If the business dissolves or files for bankruptcy, securing lost wages becomes extremely difficult, he said.
“Collectability is usually No. 1 for these clients,” said Drew. “…Oftentimes I’m giving people bad news.”
Ryan Hanson of Coon Rapids said he did recover back pay for lost wages. He said he was installing carpet and vinyl flooring in late 2014 for Hunt’s Carpet Service Inc. when he learned from a co-worker they were entitled to prevailing wage pay. He recalls they were making $17 an hour, when the prevailing wage rate was more than $46.
CEO Robert Hunt declined to discuss the issue.
After a yearlong process working with Hennepin County and the Fair Contracting Foundation, Hanson received one of two checks for several thousand dollars in back pay last Christmas Eve.
“It was a good day,” he said. “…I had the short end of the stick other times, where I basically end up walking away. They just file for bankruptcy or whatever they do, and nobody recovers a dime.”
A 2015 agreement between Hennepin County and Hunt’s Carpet Service calls the prevailing wage settlement a compromise of a disputed claim and not an admission of guilt; the principals agreed not to work on any government projects for five years.
“It was a nice change of pace to have something go right,” Hanson said. “I am a guy who does an honest living and just wants an honest check.”
Other stories in this special report