Lurking in the shadows in any crisis are the unscrupulous characters looking to take advantage of those struggling the most. We’ve been warned of the scammers pretending to be contact tracers to commit identity theft. We saw giant corporations ripping off taxpayer-funded relief intended to prevent small businesses from going bankrupt.
Likewise, unscrupulous companies that cheated their workers out of wages before the pandemic are exploiting the weakness in our worker protections by shutting down and reopening under a new name in order to avoid paying the wages they owe.
Since March, it’s been low-wage workers, workers of color, and immigrant workers who’ve borne the brunt of layoffs; they’re also the workers most likely to be victimized by wage theft as companies shut down without paying them back wages they’re owed.
These companies hope that their theft will go unnoticed among the thousands of legitimate, Covid-related business closures and new business filings as California recovers. Ensuring exploited workers are not left further behind as California recovers is why it’s so important that Gov. Gavin Newsom sign AB 3075.
Workers like Tess are counting on us.
She worked long hours in a care home for the elderly and people with disabilities. When Tess and her co-workers insisted they be paid overtime, the owner turned management of the home over to an administrator who sought to avoid overtime by putting a three hour gap in the middle of an eight-hour shift.
While responsibility for the home changed on paper, day-to-day management didn’t and neither did the needs to care for Tess’ patients. The same owner called the shots and forced Tess and her colleagues to work through their three-hour “breaks.”
Tess joined the Pillipino Association of Workers and Immigrants and is fighting to recover the wages she’s earned.
In industries with many low-road employers like care homes, employers commit
wage theft with impunity precisely because they know how rarely workers like Tess
are successful in collecting back wages- and that was before Covid-19.
Just 17 percent of workers who’ve gone through the difficult process to secure a court
judgment ordering their employers to pay back wages ever see even a dime of what they’re owed—precisely because companies can simply close up shop and open under a new name. California workers lose an estimated $2 billion from their paychecks to theft from their own employers each year, according to the Economic Policy Institute.
AB 3075 begins to remedy this by requiring anyone who wishes to incorporate
to sign a statement indicating that they don’t have any outstanding wage judgments.
The vast majority of California companies are doing right by their workers during this pandemic. Many small business owners are even dipping into their own savings or retirement funds to make payroll, to buy safety equipment to keep workers safe, or to keep the doors open so workers can put in the hours they need to feed their families.
But businesses who closed up shop in the pandemic and sent workers home without their last paychecks should ensure those workers are made whole when they reopen. AB 3075 would make California’s recovery is fair to the companies that did the right thing—and the workers who’ve been paying the most difficult price in recent months.
Lorena Gonzalez represents the 80th Assembly District in the California Legislature, which includes parts of San Diego and the South Bay. Ruth Silver Taube is the workers’ rights supervising attorney at the Alexander Community Law Center, an adjunct professor at Santa Clara University School of Law, and coordinator of the Santa Clara County Wage Theft Coalition. Opinions are the author’s own and do not necessarily reflect those of San Jose Inside. Send op-ed pitches to [email protected].