Councilman David Mann unveiled draft legislation to protect workers against wage theft and payroll fraud at a Thriving Cincinnati event on Jan. 15 hosted by the Woman’s City Club.
The legislation would apply to all workers on a construction site where the developer receives more than $25,000 in incentives under an agreement with the City of Cincinnati. The developer would risk losing the incentives and could be barred from future city contracts if any contractor or subcontractor on the construction site is found to have committed wage theft or payroll fraud.
People have to be treated fairly, said Mann, if our society is going to work. “We have too long a tradition in this country of building wealth on the backs of people who, at one time, weren’t paid at all and, more recently, aren’t paid what they should be paid.”
The legislation not only promotes fairness and equity for workers, said Mann, but it also protects city income tax revenues which suffer when workers are not fully paid or when employers commit payroll fraud by misclassifying employees as independent contractors. Independent contractors are often paid in cash with no tax withholding.
Through its “Just Pay Cincy” campaign, the Cincinnati Interfaith Workers Center has advocated for more than a year for city legislation to protect workers against wage theft. Peter Metz, Councilman Mann’s chief of staff, worked closely with Brennan Grayson, the center’s executive director, the city solicitor’s office, and the offices of development and economic inclusion to help create the draft.
This is good legislation that deserves to be adopted, said Mann. Mayor John Cranley “has indicated his support.”
Rolando Perez, a Guatemalan immigrant, also voiced his support. Perez, who was twice victimized by incidents of wage theft on construction jobs, spoke through a translator about the hardship on his family. “It’s not easy when they steal your wages because we live on the money I make each day.”
The legislation, in Grayson’s view, encourages developers to set clear expectations among their contractors and subcontractors to follow the laws protecting workers. The legislation helps create a culture of compliance in construction and empowers developers to monitor and fix problems or face consequences.
The Woman’s City Club gave special recognition in absentia to Molly North, president and CEO of Al. Neyer, for squelching an instance of wage theft by one of the company’s subcontractors and for her resolve to prevent such abuses in the future.
The workers center, a local nonprofit, advocates for low-wage and immigrant workers. Since it was founded in 2005, the workers center has helped workers recover more than $1 million in unpaid wages. Despite the center’s efforts, Grayson estimates that tens of millions of dollars in unpaid wages go unrecovered each year in Cincinnati.
The workers center needs more tools like Mann’s legislation, said Grayson, because state and federal enforcement resources are not adequate to address the problem.
The number of state wage and hour investigators has dropped from 14 to six due to budget cuts at the Department of Commerce, according to Grayson, who says the closest investigator is located in Montgomery County, and none of the investigators speaks Spanish. The number of federal investigators also has declined, and some smaller cases “do not get caught in the federal net.”
Col Owens, a policy advocate for a living wage and a former Legal Aid attorney, spoke to what he called the “ultimate wage theft” — that is, people working full time “at a legal wage that is below poverty and radically below what they need” to sustain their families.
Inadequate wages that force reliance on public benefits is part of the “underbelly of our country that is weakening our social fabric,” said Owens. He made the case that increasing wages is in the best, long-term interests of corporations because it improves worker productivity but also supports consumer spending, which accounts for about 70 percent of the country’s economic activity.
While the scope of Mann’s proposed legislation is limited to certain construction workers, Grayson hopes the city will consider using its authority to enforce existing laws protecting workers in all industries in the city.
The Woman’s City Club, which has been active in Cincinnati for more than 100 years, “promotes civic literacy through open public forums and models the democratic process through courageous dialogue and debate,” according to its web site.
The WCC created Thriving Cincinnati in 2015 to be a collaborative of nonprofits, funders, employers, residents, and policymakers addressing income inadequacy in Cincinnati.
“It is imperative for the five sectors to work together to make any headway in decreasing poverty, increasing self-sufficiency, fighting wage theft, and fostering diversity and equity,” said Susan Noonan, WCC spokesperson. “We hope to make Thriving Cincinnati a transformative movement in this region.”
By Mike Brown, firstname.lastname@example.org. Mike volunteers at the Workers Center and is a member of the Woman’s City Club.