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Know Your Rights
Source: Crain's New York Business
Subject: Workplace Justice
Type: Media Coverage

Assembly Passes Wage Boosts for Workers

The Assembly overwhelmingly approved two measures Tuesday aimed at raising standards for low-wage workers across the state.

A bill that increases penalties on employers who violate wage and hour laws and protects workers from retaliation passed by a vote of 89 to 42. And an amendment to a bill that had passed earlier in the year that extends prevailing wage law to contracted building-service workers at Consolidated Edison and other public utility companies gained approval by a 77 to 54 count.

The measures had already won Senate approval, so the bills are now headed to Gov. David Paterson’s desk for his signature. Business groups are calling on the governor to veto the prevailing wage bill, citing its costs and potential new burdens on the city’s business improvement districts. A spokeswoman for Mr. Paterson did not immediately respond to a request for comment.

The Wage Theft Prevention Act increases penalties on employers who violate wage and hour laws and don’t properly keep records. The violations typically impact immigrant and women workers and include paying employees less than minimum wage, not paying time-and-a-half for overtime, and forcing off-the-clock work.

Under the new law, workers will be able to recoup the money they are owed, plus a 100% penalty. The current law allows for just 25% in damages, meaning even if caught, employers typically end up paying little more than they stole.

The act also beefs up protections for workers who are retaliated against for exerting their rights, and gives the state’s commissioner of labor new powers to collect damages from employers who violate the law. Community advocacy group Make the Road New York and the retail and supermarket unions had pushed heavily for the bill.

In New York City alone, wage theft costs more than 300,000 workers $18.4 million every week, adding up to nearly $1 billion a year, according to a study by the nonprofit National Employment Law Project. Workers most affected include home care and child care workers, dishwashers, food-prep workers, construction crews, cashiers, laundry workers, garment workers, security guards and janitors, the report said.

Some lawmakers argue that wage theft not only hurts workers, but makes it tougher for businesses that follow the law to remain competitive. The new law would also boost state tax revenues by about $50 million a year, advocates said.

“These rogue employers not only steal wages from hard-working families…but also steal much-needed funds from our city and state coffers,” said state Sen. Diane Savino, D-Staten Island, who sponsored the bill in the Senate.

The Assembly also passed an amendment to a controversial bill that gets rid of the exemption under state prevailing wage law for public utility companies. Under the new law, contracted building-service workers at companies like ConEd and National Grid would see their wages rise from as little as $7.75 an hour to as much as $21.80 an hour, plus benefits.

“When the governor signs this bill, 2,000 hard-working New Yorkers will be able to get off public assistance programs and support their families,” said Hector Figueroa, 32BJ SEIU secretary treasurer.

The bill had drawn the ire not only of the utility companies and chambers of commerce across the state, but also of the 64 business improvement districts in the city, who worry that their contracted street cleaners could get caught up in the new law. An earlier version of the bill included BIDS, but after leaders protested, a revised version specifically exempted them. The measure that passed on Tuesday did not specifically mention BIDs but union officials insist the BIDs are not included in the new law.

But the BIDs are not convinced. In a new wrinkle, 32BJ filed a complaint last week with city Comptroller John Liu, alleging the Union Square Partnership has run afoul of existing prevailing wage law. The complaint was the union’s way of “declaring war against BIDs,” said Dan Biederman, chairman of the BID Association, an umbrella group representing the city’s BIDs.

“This [bill] exemplifies why the business community is in outright rebellion against the legislature,” Mr. Biederman said “The coalition against this is large. We will be asking the governor sincerely to veto the legislation.”

Utility companies like ConEd forcefully campaigned against the prevailing wage bill, arguing it would mean rate hikes for customers. ConEd and Orange & Rockland Utilities alone would be hit with an added $21.1 million per year in labor costs, according to company estimates.

“We urge the governor to veto the legislation,” a ConEd spokesman said. “It hurts everyone who pays electric and gas bills as well as municipalities and businesses throughout the state.”