1,300 Bay Area Nursing Home Workers Cheated out of Millions

Wednesday, April 08, 2015

The U.S. Department of Labor ballyhooed an enforcement initiative Tuesday that it said compensated 1,300 Bay Area nursing home workers with $6.8 million for minimum wage and overtime violations between 2011 and 2014. 

“The initiative has served to level the playing field among the businesses by ensuring compliance with the federal Fair Labor Standards Act,” according to the department’s press release.  

Not really.

As the Los Angeles Times reported the day before, even workers who manage to prove they were ripped off by their employers rarely collect their money. The newspaper cited a UCLA Labor Center report that found only 17% of workers who received a favorable judgment in 2008-11 actually got any money.

A report by California Labor Commissioner's Bureau of Field Enforcement found an equally dismal collection rate of 20%. The low number might have something to do with the ephemeral quality of the employers: they tend to change their ownership and names a lot.

“The new corporation isn't responsible for the old corporation's debts,” Wage Justice Center Director Matthew Sirolly told the Times. “So it's like trying to collect from the Tooth Fairy.”

Most workers don’t bother complaining about not getting paid. Around 30% of low-wage earners in Los Angeles County surveyed in 2010 said they received less than the minimum wage. Although there are around 744,000 low-wage workers, only about 5% file a complaint.

The Labor Department cited examples of success. The owners of Retirement Plus of San Carlos and four other Bay Area retirement facilities paid caregivers as little as $5 an hour. They were forced to pony up $630,000.

The Lake Alhambra Assisted Living Center went the extra mile and violated a protective order prohibiting retaliation against workers cooperating with investigators. The owners had to pay $304,000 in back wages and damages to 32 caregivers.

Anne’s Guest Home, operator of six facilities in Livermore and Pleasanton, were ordered to pay $447,000 in back wages and damages for paying workers below the $7.50 hourly minimum wage and stiffing them on overtime. Farol's Residential Care Home was told to pay $405,284 for the same shenanigans.

Noe Flores, former cook on the Flying Pig food truck, was not that fortunate and  probably has a more typical story. The Times related how Flores worked 12-hour days, six days a week in 2011 cooking pork belly buns and duck tacos for a month before being told his first two months were a free internship.

Flores filed a claim with the state and was awarded $11,000. Four years later, he has collected just a fraction of the money.

–Ken Broder        


To Learn More:

Low-Wage Workers Cheated at Nursing Homes, U.S. Says (by Bob Egelko, San Francisco Chronicle)

Few California Workers Win Back Pay in Wage-Theft Cases (by Marc Lifsher, Los Angeles Times)

US Labor Department Conducts Compliance and Enforcement Initiative in Bay Area Nursing Homes, Residential Care Facilities (U.S. Department of Labor)

Feds Find “Alarming” Minimum-Wage Violations in California and New York (by Ken Broder, AllGov California)

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