- The Washington Times - Saturday, June 15, 2002

The District's Department of Employment Services (DES) plans to start fining employers for failing to pay their employees as soon as this fall.
The fines are included in new regulations the DES is scheduled to submit to the City Council by July 1 for final review.
The regulations would allow fines against employers of up to $10,000 for failing to pay minimum wage or for refusing to pay overtime. They also could be fined up to $500 each time they are late with an employee's paycheck.
The new rules represent the first time that District employers could be fined for failing to pay employees.
"A lot of them seem to be low-income people who don't know there's any recourse," said DES director Gregg Irish. "It's been happening a lot with Latino workers."
The City Council approved the idea of fining deadbeat employers on April 3, 2001. D.C. Mayor Anthony A. Williams asked the Department of Employment Services to write the regulations.
"This legislation strengthens the city's laws so that workers' wages, especially those of low-wage employees, are protected," Mr. Williams told The Washington Times. "We look at employees as an asset to the city and we must treat them as such."
Support on the City Council for the fines grew during the shortage of workers that preceded the recession last year.
"A lot of workers were being exploited," Mr. Irish said. "We believe this is necessary because of that. We're talking about folks who are making minimum wage or a little more. They can't afford to have their checks delayed."
Last year, the D.C. Wage-Hour Office, a part of the DES, collected $559,368 in wages owed to 962 unpaid or underpaid employees. The average amount collected per claim was $581. The largest amount collected on a single claim in the past five years was $47,000.
This year, the office is heading toward total collections of about $600,000, Mr. Irish said.
So far, the idea of fining employers has met no significant opposition on the City Council, Mr. Irish said.
"I think it's been long overdue," said Josh Williams, president of the Metropolitan Washington Council, AFL-CIO. "There's just no excuse at all for someone who has provided their labor not to be compensated."
The D.C. Chamber of Commerce and the Greater Washington Board of Trade chose not to comment.
However, Amy Jensen, a lobbyist for the National Federation of Independent Business, said, "There is currently a system of court review and administrative review through the Department of Labor. Any additional penalty, it seems to me, would be unnecessary."
After the DES completes a final draft of the regulations, the City Council plans to review them, then publish them in the D.C. Register for public comment. The Wage-Hour Office expects to begin fining employers next fall.
All the money collected in fines would be returned to the Wage-Hour Office to pay for its enforcement program. The office is operating with a seven-person staff on a $527,214 annual budget. Fines are expected to generate $50,000 in new revenue during the first year.
Other jurisdictions have dealt with deadbeat employers in different ways. New York imposes fines of up to $3,000 per offense. Maryland lets workers collect up to three times the amount they are owed through lawsuits. Virginia imposes fines of up to $1,000 per offense for failing to pay employees and up to $200 for failing to pay minimum wage.
Currently, if a D.C. Wage-Hour Office investigation turns up a valid claim against a deadbeat employer, the office will notify the employer of its finding that the back wages should be paid. If the employer refuses, the Corporation Counsel can prosecute the employers under civil or criminal law.
Most employers pay promptly when the Wage-Hour Office notifies them they owe workers money. However, about 15 employers are prosecuted by the Corporation Counsel each year, most of them on criminal fraud charges.
So far this year, six employers have been successfully prosecuted. Five were prosecuted on criminal charges and one in civil court.
Pam Banks, associate director of the Wage-Hour Office, said fining the employers could be a better alternative for both the employers and the employees.
"It's a more effective and actually a more friendly way to deter violations of the law," Mrs. Banks said. "If it gets to criminal court, then they have a criminal record. It's not hard to get a criminal conviction."



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