Denver recovered a record amount of wage theft money this year. Stronger protections for workers may be coming

When Michael Ginzel did every week of building work for a contractor in Denver, Ginzel mentioned his employer informed him to count on a verify within the mail. Weeks glided by with no cash, and Ginzel’s calls went unanswered. He confirmed as much as the employer’s home in particular person and located himself in what he known as a combative and harmful state of affairs.

“I used to be determined, I had no cash, no work,” Ginzel informed Metropolis Council at this week’s Finance and Governance Committee public remark session on preventing wage theft. “It’s not essentially about doing what is true for the employees, it’s additionally about defending their security.”

Metropolis Council is weighing an ordinance that will strengthen protections for staff experiencing wage theft.

It has the assist of labor leaders, however companies fear it would add paperwork and hurt small companies. On Tuesday, Council members on the Finance and Governance Committee expressed assist for the proposal, however voted to postpone passing it to the total council with a view to reply further questions and have interaction with companies.  A particular assembly to vote on sending the proposal to the total council is scheduled for Dec. 20.

Dialogue of the ordinance comes throughout a 12 months the place Denver recovered a document $1.1 million in wages for staff in 2022, in contrast with round $690,000 in 2021 and round $1 million in 2020.

A report from the Colorado Fiscal Institute estimates that employers steal an estimated $728 million from staff throughout the state, with low earnings staff, staff of colour and girls most in danger. The report estimates that this interprets to an approximate $45 million in misplaced tax income for the state.

In 2022, one of many largest sums recovered in Denver got here from a $207,000 case for 35 folks working for trash elimination companies and disposal web site contracts, the place the contractor was incorrectly claiming advantages like medical health insurance, paid day off or retirement plans.

One other investigation recovered about $48,000 for 107 workers working for a valet parking firm, which was underpaying its workers and impartial contractors. “Valet corporations had been certainly one of our most typical areas of underpayments this 12 months,” wrote metropolis Auditor Timothy O’Brien in his report. “We recognized underpayments of greater than $111,000 for staff in that business alone.”

A 3rd case recovered cash and acquired a elevate for an Afghan refugee getting paid beneath minimal wage. The auditor’s workplace didn’t embody the particular person’s job, or identify any particular corporations in its report.

“We encourage any group teams to achieve out in the event that they know of a attainable underpayment,” O’Brien wrote. “The minimal wage applies to all work carried out within the Metropolis and County of Denver, no matter a employee’s immigration standing.”

In 2023, Denver’s minimal wage is rising from $15.87 to $17.29 per hour, apart from folks within the meals and beverage business, who can declare as much as $3.02 per hour in documented ideas.

Metropolis Council’s ordinance would strengthen protections for staff towards wage theft.

Councilwomen Stacie Gilmore, Candi CdeBaca and Amanda Sawyer, and Council President Jamie Torres, sponsored an ordinance on stopping wage theft at Council’s Finance and Governance Committee on Tuesday.

The brand new coverage would enable employee complaints to go on to the auditor. “By avoiding courts and threats of jail time, staff can receives a commission extra rapidly,” wrote the Council members in a presentation on the ordinance.

Torres defined that employers typically keep away from paying out owed wages by classifying staff as impartial contractors, which is why the ordinance would increase to incorporate impartial contractors as effectively. It might additionally enable staff to take their complaints up the chain of command, even when their employer is bancrupt and can’t pay.

The ordinance would additionally give staff the chance to deliver a civil motion to courtroom, as a substitute of going via the auditor.

The sponsors emphasised that the proposal just isn’t meant to unfairly goal unintentional theft, and that the auditor has flexibility in penalties imposed.

“We’re actually going after people who find themselves deliberately withholding wages, don’t repair points in 30 days and/or don’t cooperate with investigation, so this isn’t supposed for individuals who make an trustworthy mistake,” CdeBaca mentioned.

On the committee assembly, individuals who had skilled wage theft shared their tales.

Building staff spoke about being pressured to categorise as self-employed, not getting extra time pay and never with the ability to qualify for unemployment. Labor leaders additionally acknowledged that wage theft makes it troublesome for lawful companies to compete.

David Hernandez spoke on behalf of painters, drywall finishers and different building staff. He mentioned his union present in a survey that one in six of their staff had skilled wage theft. “Like me, there are staff in all places being victims of wage theft,” he mentioned. “Not solely that, however there are various corporations that make the most of these staff’ immigration standing.”

Labor organizer Alejo Gonzalez shared the tales of residence care staff, who’re predominantly ladies of colour, together with somebody who needed to reside in her automotive and one other who skipped meals after checks bounced.

“Day-after-day this occurs,” Gonzalez mentioned. “The espresso that a few of you’re consuming, these baristas are experiencing it. The lunches and dinners you had, these restaurant staff are experiencing it.”

Enterprise leaders denounced wage theft, however mentioned Council’s proposal would damage the enterprise group.

Leaders expressed concern with the flexibility for staff to deliver complaints up the chain, saying that it might disproportionately have an effect on small and minority owned companies that haven’t finished something mistaken.

Jess Kostelnik, who spoke on behalf of the Denver Metro Chamber of Commerce, condemned wage theft, however mentioned that Colorado already has robust state and federal protections. “We severely query the necessity for and efficacy of Denver’s wage theft proposal as it’s at the moment written,” she mentioned. “[It] would make proudly owning a enterprise and doing enterprise in Denver much more bureaucratically nightmarish.”

Others requested for a delay.  “Let me be clear, we don’t assist wage theft, we strongly imagine that everybody must be paid for his or her work,” mentioned Kate Barton, Chief of Exterior Affairs for Downtown Denver Partnership. “We wish to be certain that your entire enterprise group, these which are most impacted by this coverage, have the chance to supply significant suggestions and guarantee this coverage has the specified affect.”

CdeBaca mentioned that in growing the ordinance, town checked out states like Maryland and Massachusetts with related laws that allowed legal responsibility for wage theft to go up the chain of command. “There’s nonetheless clearly enterprise occurring, nonetheless clearly building occurring at unprecedented ranges,” she mentioned.