Wage Theft Criminalization Unresolved

February 29, 2012

DENVER, CO – Well known casualties of the recession have been unemployed Coloradans, 7.9 percent in December, but another class of victims has emerged – employed workers who are never paid. But, would the problem of “wage theft” by employers be resolved by throwing them in jail?

The issue was debated Tuesday by the House Judiciary Committee when they considered HB 12-1296, sponsored by Rep. Jonathan Singer (D-Boulder), a bill to make it a felony for employers who failed to pay wages greater than $1,000 and a misdemeanor for lesser amounts.

“It’s our regular workers that are the back bone of this economy, and ultimately they’re the folks who are going to get us out of this recession,” said Singer. “But without good, responsible businesses to back them up, it’s going to take us longer to recover.”

“Please help us to stop employer theft – it is human trafficking,” implored Billie Jackson, aWestminsterwoman who sent a statement to the committee. A college student, Jackson said she had been swindled out of $200 pay by a housecleaning business.

“I have witnessed what suffering wage theft has caused to individuals, their families and to our community,” testified Ann Dunlap, a United Church of Christ minister.

Dunlap said that one man had worked for two weeks laying marble floors at a bank. He’d been promised $1,000 for his labor, but the contractor never paid him. The minister said another woman had worked 60 hours at a bakery, but the business paid for only 40 hours.

“She was robbed 20 hours of wages,” declared Dunlap.

As a volunteer at the Wage Theft Clinic, Dunlap said she has attempted to help many people recover unpaid wages by consulting attorneys, talking with law enforcement agencies, contacting the state Department of Labor, going to small claims court and even calling the errant employers.

“None of these efforts resulted in our folks being paid,” said Dunlap, who voiced her support for the bill to criminalize nonpayment of wages.

Rhonda Brownstein, a CU law professor, said her students in civil litigation have worked to recover unpaid wages because most attorneys reject these cases because they would be paid too little or not at all.

“Most of these people are fly-by-night operators,” said Brownstein of employer cheats. “They don’t have any wages you can garnish.”

Bob Norris of Longmont said he too has tried to help unpaid workers but none of his efforts resolved the problem. He produced a note from an employee of the city ofBoulderthat adopted an ordinance in 2008 to prohibit wage theft.

He said the city has received complaints from an economically and demographically diverse pool of unpaid employees that include landscapers, janitors, hairstylists, pastry chefs and software engineers.

“It absolutely shocks me that in this country we have a lot of laws… yet there’s such a huge number of people who aren’t protected from wage theft,” said Norris.

He took the issue to Boulder District Attorney Stan Garnett in October 2011, and was told the problem with Colorado’s criminal theft statute is that it only applies to the permanent loss of something of value. A job is not considered permanent. It’s also a challenge to prove beyond a reasonable doubt the loss.

“Stan Garnett feels this law would make it better and easier to prosecute these crimes,” said Morris, who also supports the bill.

“Is it your position that as many laws that we have, if we pass one more law that it’s really going to do a lot of good?” asked Rep. Bob Gardner (R-Colorado Springs), chairman of the House Judiciary Committee.

“We have a law against murder, but people still get murdered. We have a law against rape, and there are still rapes. We have a law against theft, and there’s still a lot of that,” said Gardner. “Do you really think, other than the deterrent of putting someone in jail, that this is going to help this situation?”

Norris said a bad employer might pay up if they were subject to being charged with a felony or a misdemeanor that might result in losing their business license and being disqualified for a loan.

“If the goal is to get the money and get the person paid, if somebody is suffering a criminal penalty and ends up in jail, doesn’t that put the person operating the business even more on the margin?” asked Assistant House Majority Leader Mark Waller (R-Colorado Springs).

But, Rep. Daniel Kagan argued that these are not just struggling businesses, but thieves.

“The testimony has shown there are habitual offenders – repeat criminals – who cheat low income workers by stealing their labor and not paying for it,” asserted the Democrat legislator from Greenwood Village.

“I’ve got no love for people who don’t pay their employees. Quite frankly, I’ll be honest and say I think you’re a dirt bag if you don’t pay them,” said Rep. Brian DelGrosso (R-Loveland). “But I don’t think this bill addresses the problem.”

Singer argued that his bill would be a deterrent to wage theft, and if it didn’t pass, “Colorado could lose some jobs or be perceived as a business unfriendly state.”

“I wonder if the creation of a debtors’ prison in theUnited Statesis the policy that one would want to pursue,” saidGardner, considering the outcome if the bill passed. “That really seems to me that is what we would do – create a debtors’ prison for people who may have as much difficulty and hardship as others.”

Though all the committee members thanked Singer for bringing this issue to light, the bill failed, 6 – 5, on a party line split.

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