October 2022, Volume 28, Number 4
California: Wage Theft
Rising labor costs due to California’s increasing minimum wage, overtime pay requirements, covid-related protocols, and fewer new entrants to the farm workforce are prompting three major reactions, more mechanization and mechanical aids, more H-2A guest workers, and more US crop changes and rising imports of labor-intensive commodities.
How much wage theft occurs in California? The Labor Commissioner’s office received 17,000 claims from workers alleging $300 million in stolen wages in 2021, down from the average 30,000 worker claims a year for $320 million. An analysis of 2017 wage theft claims found that workers alleged an average theft of $10,000, and if they settled or proceeded to a hearing received about 10 percent of their claim in back wages.
Wage theft covers payment for hours worked that are less than the minimum wage, failure to pay premium wages for overtime, or employers making unlawful deductions or keeping tips and bonuses. Individuals file wage theft claims with the state Labor Commissioner’s office, which is supposed to make a decision on the claim within 120 days if the parties do not settle. Most cases settle.
The leading sectors for wage theft claims in 2021 were health and child care, 13 percent of all claims, followed by retail, 11 percent, and hotels and restaurants, office support (janitors), and professional services, 10 percent each. Construction accounted for five percent of claims, and agriculture less than five percent.
A 2021 state law makes wage theft of more than $950 over one year or more a crime that can lead to jail time if the employer deliberately committed wage theft via fraud.
Cal-OSHA has since the 1970s required that “all self-propelled equipment shall, when under its own power and in motion, have an operator stationed at the vehicular controls.” Makers of autonomous tractors such as Monarch want the regulation changed so that one operator could monitor several driverless tractors.
California and New York have budget surpluses and debts to the federal government of $18 billion and $8 billion, respectively, due to borrowing to pay UI benefits. States administer UI programs and determine both the taxes that employers pay and access to benefits, and states collectively borrowed a peak $55 billion to pay UI benefits in April 2021. Since then, UI claims fell and most states repaid their UI loans.
1983. A survey of 1,280 farm workers found that 80 percent were born in Mexico, but only 20 percent were unauthorized; 20 percent were US citizens. These hired workers earned an average $4.66 an hour, almost 40 percent more than the state’s $3.35 minimum wage. They worked an average of 24 weeks a year, earning $175 a week and $4,200 a year. The highest-earning workers were young men who worked for piece rate wages, making the harvest labor market akin to professional sports with high earning years concentrated when workers are in their 20s and 30s.
The survey was conducted by 42 EDD offices throughout the state. The sample reflected average employment, including 45 percent in the San Joaquin Valley, 25 percent in Southern California, and 20 percent in the Salinas Valley. A higher share of workers were employed by FLCs in the SJV than in Salinas or Oxnard.
Men averaged 26 weeks of farm work a year and women 16 weeks, and the quarter of farm workers who had nonfarm jobs averaged four weeks of nonfarm work. A third of workers visited Mexico in 1982-83.