House Democrats take aim at wage theft

Working as a cook the past four years, Kevin Osborn of Minneapolis said he has seen a lot of wage theft. Osborn said the practice is common in the restaurant industry.

"You come in, you set up your station for an hour or two here before you clock in," Osborn said. "Then when you get off, you clean for a little bit off the clock. It's just standard issue to fudge a timesheet, to move overtime around so that the employer doesn't have to pay."

Osborn said workers who complain can lose their jobs or see their hours reduced. Still, he and other workers went to the Capitol to speak out about the issue and show support for legislation to prevent future wage theft.

Robin Pikala, a personal care assistant from Fridley, said she worked 45 days without pay in 2004 as her employer approached bankruptcy.

"I kept working, hoping for the best. But as all too often is the case, the harm was never made right. The owners got off unpunished," Pikala said.

Rep. Tim Mahoney, DFL-St. Paul, said most employers are not cheating workers. But he said those who do are criminals that need to be held accountable.

"I represent an area that has people who live on a paycheck-to-paycheck basis," he said. "When they don't get paid, when they get stolen from, their lives spiral out of control, whether it's they can't pay their rent or they can't put food on the table for their kids. That's wrong."

Under a bill authored by Mahoney and approved on a voice vote by the House Labor Committee Wednesday, employers would need to keep detailed records on employee pay. They would face tougher penalties for failing to meet any pay requirements. Minnesota Department of Labor and Industry would also get additional authority to enforce wage laws, including subpoena power.

House Majority Leader Ryan Winkler said the bill is a top priority for the DFL this session. Standing with several concerned workers, Winkler said the legislation would correct an "abuse of economic power" by some employers.

"While most people will do the right thing even though nobody's watching, some people won't. And the people won't do the right thing and will cheat and lie and steal when they can get away with it — they are hurting all of these people."

Other lawmakers think the bill goes too far.

"I don't know that we need to come with a sledgehammer-type approach to businesses until we actually have more data on what's actually going on," said Rep. Dan Fabian, R-Roseau.

Wage theft is a bad thing, said Fabian but he expressed concern about the amount of new administrative work businesses would have to do under the bill, as well as its increase in fines from $1,000 to $10,000.

Fabian also questioned the scope of the problem.

"You know, I have a lot of empathy for small business owners. I've got a tremendous number of them in my district, and I don't know very many people who knowingly, willfully cheat their employees out of their wages," he said. "I just don't think it happens very often."

The bill does not yet have a companion in the Republican-controlled Senate.

Lawmakers passed a funding increase for the Department of Labor and Industry two years ago to hire additional wage theft investigators.

Some additional concerns were raised during the labor committee hearing.

Adam Hanson, of the Associated Builders and Contractors of Minnesota, said the bill doesn't account for unintentional paperwork mistakes or companies with multiple offices. Hanson said employers would also be viewed as guilty until proven innocent.

"The bill in its current form would take that 99.9 percent of good employers who are doing the right thing and put a target on their backs simply for honest mistakes," he said