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Wage initiative stymies labor nominee

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President Obama's nominee for the Labor Department's top law enforcement job created a first-of-its-kind program in New York that deputized unions and advocacy groups to visit private businesses and report wage violations to the government, an initiative that has raised concerns holding up her appointment.

M. Patricia Smith told senators vetting her appointment to be the Labor Department's solicitor that her "wage watch" pilot program in New York was created over the past year to "engage groups to help us with education" and not to let the private groups conduct labor investigations.

But internal memos obtained by Republican aides on the Senate Health, Education, Labor and Pensions Committee show that Ms. Smith's state labor agency in New York actually referred to the union and group participants as "enforcers," The Washington Times has learned.

Businesses and some Republicans are concerned that Ms. Smith's program and the philosophy behind it amount to an "unprecedented and unwarranted" intrusion on private business, and could empower unions to use their role in the government program to improperly pressure companies to accept contract concessions or unionization of their work force.

Sen. Michael B. Enzi of Wyoming, the top Republican on the Senate Health, Education, Labor and Pensions Committee, called this week on Mr. Obama to withdraw Ms. Smith's nomination. He accused Ms. Smith of misleading the committee about the true nature of the "wage watch" program in New York.

"If it was her intention to mislead the Senate, then I must oppose her nomination," Mr. Enzi wrote Mr. Obama in a letter obtained by The Times. "If she unintentionally gave inaccurate statements to the Senate, then I question her ability to manage a large operation, since she does not have a clear understanding of what is taking place in her own department in New York."

Ms. Smith declined to comment through a spokesman. The White House had no comment on Mr. Enzi's letter and referred questions to the Labor Department, which released a statement by Secretary Hilda L. Solis that defended Ms. Smith as a "tough, fair and innovative" leader but did not specifically address the concerns about her testimony.

Ms. Smith forged a "well-deserved reputation for being a tough enforcer of the law" in New York and "our nation could ask for no better solicitor of labor than this," Ms. Solis said. "Throughout her career, she has fostered collaboration among workers, the community and employers who are put at a disadvantage when their competitors refuse to comply with basic employee protections."

When she was questioned during her nomination hearing about whether she would consider such a program at the federal level, Ms. Smith said, "No, we have not had any discussions of that."

Ms. Smith has served as head of New York's Labor Commission. One of her top regulators who oversaw the "wage watch" program, Lorelei Boylan, has been nominated by Mr. Obama as administrator of the Wage and Hour Division at the U.S. Labor Department.

On Nov. 28, Ms. Boylan wrote a message to co-workers, which was copied to Ms. Smith, on the subject of training groups in the wage watch program. It said, "The one-day session will not turn the enforcers into labor law experts but will assist them in identifying labor law violations and make the referrals of greater value."

Leo Rofales, a spokesman for New York's labor department, said groups that participate in the pilot program do so on a volunteer basis and cannot request financial books from employers. He also said state regulators have "made it very clear" to participants to avoid conflicts of interest. Although outside groups can make referrals, he said, only state authorities will decide whether to conduct investigations.

"Their role is education and referrals," he said. "It's not to ask for records and it's not to be Department of Labor staff."

When Ms. Smith announced the wage watch program, she said the idea was for community groups to improve labor law compliance by giving information on wage laws to workers and managers in supermarkets, laundromats, nail salons and other businesses. When the groups find "serious violations," they'll have a formal point of contact in the labor enforcement offices to make referrals, she said.

"New York Wage Watch will increase labor law compliance by giving regular people a formal role in creating lawful workplaces statewide, and thereby improving the quality of life in their communities," she said.

The program began with six groups: El Centro del Inmigrante in Staten Island; the Chinese Staff and Workers' Association; the Retail, Wholesale and Department Store Union; Make the Road New York; the United Food and Commercial Workers International Local 1500; and the Workplace Project in Long Island.

But within weeks of the announcement, business groups questioned the program. Five trade groups representing restaurants, retail outlets, convenience stores and other businesses across New York sent a letter to Ms. Smith saying the program "steps well over the boundaries of even the most constructive collaborations with community groups and advocates."

The letter from business groups also cited fears of "an unprecedented and unwarranted intrusion on New York's employer community."

Scott Wexler, executive director of the Empire State Restaurant and Tavern Association, who signed the letter, said the business leaders later met with Ms. Smith privately to discuss their concerns.

"We came away with the impression that the department was probably less nefarious than we thought but a bit more than they were letting on," he said. "I don't think any of us left that meeting thinking that this still wasn't a conflict of interest" for unions to participate.

Pat Purcell, assistant to the president for the Food and Commercial Workers Local 1500, which participates in the program, said wage watch isn't being used as a tool to negotiate with employers. He said the union, like any member of the public, already had the power to refer wage violations to the government.

"This is not what it's for," Mr. Purcell said, describing Ms. Smith as "an extremely fair-minded person who's trying to find out ways to bring labor and business together in an educational approach. It's not a gotcha approach."

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