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Putting Wage Theft on the Map (Literally)

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Image: Adam KaderWorkers employed in low-wage and poorly regulated industries (most prominently restaurants, residential construction, domestic cleaning, and mechanics) are confronted with staggering exploitation as employers look to cut corners in today’s recession. Such exploitation includes health and safety violations, discrimination, sexual harassment, retaliation, firing for participating in union activity, and wage theft—failure to pay workers for work performed, including overtime hours and final pay periods.

To combat this wave of illegality, a Chicago worker center has collaborated with a local university to create a map of law-breaking employers against which they have organized, giving workers and activists a powerful visual tool to bring to politicians and the community.

The Arise Chicago Worker Center has no shortage of evidence for the dire conditions facing Chicago’s low-wage workers, having collaborated with over 2,050 workers in the past seven years.

None of the restaurant workers who have contacted our organization during that time received overtime wages. One of our members seriously injured his back at a construction site, but his employer refused to pay legally required workers’ compensation. One African-American member, who works for a state-funded social service agency, has consistently received paychecks one to three weeks late, for more than two years. A group of candy manufacturers were denied bathroom breaks.

Recently, we spoke with a Guatemalan immigrant car wash worker who works from 7 a.m. to 8 p.m., six days a week, for $5.25 an hour. He does not receive overtime pay and takes home an average of $9 a day in tips. If that weren’t enough, the employer does not provide gloves needed for the work, and illegally deducts the cost of the workers’ required uniform from his paychecks.

With the help of the University of Illinois-Chicago Center for Urban Economic Development, Arise has mapped by ward—a political district—the law-breaking employers against which Arise has organized. The maps illustrate law-breaking employers in 43 of Chicago’s 50 wards, affecting workers living in 47 of the wards.

Groups of worker center members plan to meet with their ward aldermen to discuss workplace abuses and enlist support for a city response to the biggest problem facing low-wage workers: wage theft.

Clergy whose congregations are located in the 43 wards will join the workers. Recently, Catholic Bishop John Manz attended a meeting with Alderman Danny Solis in the 25th Ward, where Arise has recorded a dozen labor violations.

Solis committed to introducing the issue to the city council’s Hispanic Caucus, whose wards include great concentrations of Arise membership. Alderman Mary Ann Smith’s office offered to explore legislative strategies that could deny additional business permits to law-breaking employers. Additional meetings and research are planned to determine the best approach to address wage theft in Chicago—which may include a citywide ordinance that could make stealing a worker’s wages treated like other forms of theft.

*This post originally appeared in Labor Notes on December 3, 2009. Reprinted with permission from the author.

About the Author: Adam Kader (www.arisechicago.org) is the director of the Arise Chicago Worker Center, part of the national Interfaith Worker Justice network.


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Court Upholds $1.9 Million Dollar Verdict In Gender Discrimination Case Against Wal-Mart

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Female Pharmacist Wins Appeal Including Punitive Damages and Huge Front Pay Award

It’s one thing to prove discrimination. It’s an altogether different thing to prove damages which occurred as a result of it.

In the recently published gender discrimination case of Haddad v Wal-Mart Stores Inc,*, the Supreme Court Judicial Court (“SJC”) of Massachusetts affirmed a jury verdict which included $733,000 for 19 years of front pay (future economic loss) and $1 million dollars in punitive damages – and that’s big news.

What Happened In The Case

Cynthia Haddad worked as a pharmacist at Wal-Mart for ten years (seven of those in the Pittsfield, Massachusetts store) mostly as a staff pharmacist. Throughout her time at Wal-Mart, she received excellent evaluations.  

Towards the end of her employment, Haddad accepted the position of pharmacy manager.

During that time, she received less pay than any male pharmacy manager which she consistently complained about.

On April 14th, 2004, Haddad was questioned by three Wal-Mart managers about abut two fraudulent prescriptions.

One of the prescriptions was written in 2002 while Haddad was on duty, and another was written in 2004 while a male pharmacist was on duty.

Haddad told the managers that she did not know anything about the fraudulent prescriptions.

She did admit that the 2002 fraudulent prescription could have been written when she briefly left the pharmacy area to buy a soda at a nearby counter, or when she was in the restroom, eating lunch, or talking to customers.

Haddad’s employment was terminated that same day.

She was told that the reason for her termination was based on her statement during the interview that she failed to secure the pharmacy and left Baran (the technician) unattended in the pharmacy area. Baran, who admitted that she falsified the prescription,was also terminated.

The other pharmacist involved — Richard Blackbird — was on duty the day the fraudulent 2004 prescription was written. That prescription contained his initials.

In a clear case of unequal treatment, neither Blackbird, nor any other pharmacist was questioned about or disciplined for the 2004 fraudulent prescription.

In stark contract to the treatment Haddad received,  Blackbird was appointed to be pharmacy manager at the time of Haddad’s departure.

In addition, Blackbird testified that he commonly left the pharmacy area unsecured to talk to a customer, go the restroom, or get a snack – and that he was unaware of any policy prohibiting this practice.

Haddad filed a lawsuit alleging unequal compensation and termination of employment in violation of Massachusetts laws against discrimination. (M.G.L. c. 151B, s.4) The complaint also stated a claim for defamation.

The jury found in Haddad’s favor and awarded $922,774 in compensatory damages which included:

  • $17,700 in special damages
  • $125,000 for emotional distress
  • $95,000 in back pay
  • $733,000 in front pay

The jury also awarded $1 million dollars in punitive damages.

The Appeal

Wal-Mart appealed claiming a number of errors.

Sufficiency of the Evidence

Wal-Mart claimed that Haddad did not introduce enough evidence to prove discrimination. The Supreme Judicial Court of Massachusetts disagreed. It held that there was sufficient proof to support the verdict including evidence that:

  • Wal-Mart’s proffered reasons for terminating Haddad were false
  • Similarly situated male employees were treated differently than Haddad for similar infractions of the same policy
  • Other incidents occurred  in which male pharmacists were not disciplined for far more serious infractions, ie. one pharmacist was caught writing prescriptions and taking drugs for himself and was not fired
  • Wal-Mart failed to follow its progressive discipline policy

Front Pay

The jury awarded the plaintiff nineteen years of future economic loss which consisted of the difference in pay and benefits that Haddad would have earned at Wal-Mart compared to the pay and benefits she earned at the job she held at the time of trial.

Nineteen years of compensation represented Haddad’s loss of earning through age 65.

Wal-Mart contended that the front pay award was excessive and speculative. The Court disagreed:

While the award of $733,307 represents a significant dollar figure for front pay, the evidence supported such an award ….

The plaintiff testified to her difficulty in obtaining a new job. There was evidence that Wal-Mart’s allegations concerning her alleged responsibility for drug losses became generally known….

[T]he award of lost income of nineteen years is consistent with the plaintiff’s anticipated retirement age of sixty-five.

Based on the plaintiff’s ten-year tenure at Wal-Mart, her testimony that she had planned to continue working at Wal-Mart for the remainder of her career, and the limited number of pharmacies in the area around Pittsfield, the jury permissibly could have concluded that an award of nineteen years was appropriate.

The Court discussed other cases (both state and federal) in which employees were awarded economic loss for long periods of time into the future – particularly where the circumstances indicated that plaintiffs would have difficulty obtaining comparable employment.”

It’s a very helpful opinion for plaintiffs and their lawyers on the issue of damages for future economic loss in wrongful discharge cases

Punitive Damages

It’s not often that we see cases in which an award of punitive damages is affirmed on appeal.

To sustain the award of punitive damages in this case, Haddad had to prove that the defendant’s act “was outrageous, egregious, evil in motive, or undertaken with reckless indifference to the rights of others.”

Some of the evidence which the SJC of Massachusetts relied upon to support the award included proof that:

  • Wal-Mart was aware that gender discrimination was not illegal
  • Wal-Mart refused to pay Haddad the hourly rate it paid male pharmacy managers
  • Wal-Mart fired a ten-year employee for a single infraction after a sham investigation
  • Male pharmacists were not disciplined for similar or far more serious infractions

It wrote:

The jury was warranted in concluding that Wal-Mart’s pattern of unequal treatment of male and female pharmacists was outrageous and reprehensible.

Lessons To Be Learned

There is no doubt that in today’s economic climate the chances of finding comparable employment after a discharge are slim. What this means is that when employees unlawfully lose their jobs, and prove it, it’s likely that we will see larger and larger verdicts just like this one. It’s an important case both for its content and as a harbinger of what’s to come.

* Reprinted from Westlaw with permission of Thomson Reuters

** This post originally appeared in Employee Rights Post on December 1, 2009. Reprinted with permission from the author.

Images:

63.135.122.65/bergdahlphoto/Wal-Mart

www.a-fib.com/images

About the Author: Ellen Simon is recognized as one of the first and foremost employment and civil rights lawyers in the United States. With more than $50* million in verdicts and settlements and over 30 years of experience, Ellen has been listed in Best Lawyers in America and in the National Law Journal as one of the nation’s leading litigators. She has been lauded for her work on landmark cases that established employment law in both state and federal court. Ellen also possesses a wealth of knowledge as a legal analyst discussing high-profile civil cases, employment discrimination and women’s issues. Ms. Simon has been quoted often in local and national news media and is a regular guest on television and radio, including appearances on Court TV. She is the author of the Employee Rights Post, a legal blog devoted to employee and civil rights.

*prior results do not guarantee a similar outcome


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Putting People Back to Work and Obama’s Jobs Summit

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The U.S. is now 24 months into the worst economic crisis since the Great Depression. Over the course of those two years, we have lost 8.1 million jobs and 17.5 percent of the workforce–27.4 million workers–are unemployed, underemployed, or have given up looking for work. Economists surveyed by Bloomberg forsee the unemployment rate remaining at above 10 percent well into the first half of 2010.

On the eve of President Obama’s Jobs Summit at the White House, SEIU Secretary-Treasurer and Change to Win Chair Anna Burger has a piece on the Huffington Post outlining a bold jobs plan to meet the demands of a 21st century economy:

“If we are going to come out of our current crisis stronger and better prepared for the challenges of a 21st century economy, we need someone to take charge, to focus–24/7–on job creation until we see results.

“It’s time for President Obama to empower the 21st century Francis Perkins, someone to speak for him and someone who has the authority across government to shake things up. It’s time to create a country that works for all of us. And that starts with jobs.

“Creating jobs isn’t rocket science. We just need the political will, courage and determination to make it happen.”

The jobs plan Burger laid out focuses on investments in public services and the private sector, a national job training program, and the need to pass the Employee Free Choice Act. Her plan also advocates for a “green bank” to fund energy-efficiency and renewables projects, as well as funding for infrastructure to help rebuild schools and roads. Read the entire plan here.

Burger will join 129 business, academic and government leaders at tomorrow’s Jobs Summit. Other labor labors in attendee will be Leo Gerard from the United Steelworkers, Joe Hansen from UFCW, the AFL-CIO’s Richard Trumka and AFT president Randi Weingarten.

Economist Paul Krugman, who will be at the White House jobs forum as well, shares his thoughts on how we can begin to right the wrongs of our economy in the NY Times this week. A large part the solution, according to Krugman? Not leaving workers out of the economic recovery–and the federal government actually creating jobs. “There’s a pervasive sense in Washington that nothing more can or should be done, that we should just wait for the economic recovery to trickle down to workers,” notes Krugman. “This is wrong and unacceptable.”

Krugman proposes direct public employment and employee incentives–such as a tax credit–to swell job creation.”All of this would cost money, probably several hundred billion dollars, and raise the budget deficit in the short run,” he writes . “But this has to be weighed against the high cost of inaction in the face of a social and economic emergency.”

More confirmed attendees of tomorrow’s jobs forum at TPM here.

*This post originally appeared in the SEIU Blog on December 2, 2009. Reprinted with permission from the author.

About the Author: Kate Thomas is a blogger, web producer and new media coordinator at the Service Employees International Union (SEIU), a labor union with 2.1 million members in the healthcare, public and property service sectors. Kate’s passions include the progressive movement, the many wonders of the Internet and her job working for an organization that is helping to improve the lives of workers and fight for meaningful health care and labor law reform. Prior to working at SEIU, Katie worked for the American Medical Student Association (AMSA) as a communications/public relations coordinator and editor of AMSA’s newsletter appearing in The New Physician magazine.


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When The Revolution Comes, Your 401(k) Will Be First Against The Wall

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Everybody’s favorite vampire squid, Goldman Sachs, has practiced a form of virtual class warfare for a long time now.

But Bloomberg reports today that top execs there are now arming themselves for the real thing:

“I just wrote my first reference for a gun permit,” said a friend, who told me of swearing to the good character of a Goldman Sachs Group Inc. banker who applied to the local police for a permit to buy a pistol. The banker had told this friend of mine that senior Goldman people have loaded up on firearms and are now equipped to defend themselves if there is a populist uprising against the bank.

I called Goldman Sachs spokesman Lucas van Praag to ask whether it’s true that Goldman partners feel they need handguns to protect themselves from the angry proletariat. He didn’t call me back. The New York Police Department has told me that “as a preliminary matter” it believes some of the bankers I inquired about do have pistol permits. The NYPD also said it will be a while before it can name names…

Talk of Goldman and guns plays right into the way Wall-Streeters like to think of themselves. Even those who were bailed out believe they are tough, macho Clint Eastwoods of the financial frontier, protecting the fistful of dollars in one hand with the Glock in the other. The last thing they want is to be so reasonably paid that the peasants have no interest in lynching them.

I’m not sure what kind of Mad Max future these people are envisioning, exactly. But it is kind of funny to imagine an investment banking nerd thinking that dropping $500 on a Glock 19 will turn him into the Road Warrior.

UPDATE (4:00PM): More reactions…

SEIU:

They just don’t get it. The thousands of people that showed up outside their door in Chicago and DC aren’t part of some violent mob; we’re taxpayers who’ve been taken for a ride by Wall Street and want to get off at the next stop. Our message has been clear and simple every time: stop using our money on lobbying and bonuses.

LOLFed:

Goldman employees…think about this for a moment. You work for one of the nation’s most hated institutions. You’re pretty unpopular already. But one of the few things Goldman has not yet been accused of is actually killing someone. Do you really want to be the one to break that long and storied tradition of not killing someone? That’s a guaranteed way to get your bonus chopped down to five figures, mister.

*This post originally appeared in Change to Win on December 1, 2009. Reprinted with permission from the author.

About the Author Jason Lefkowitz: is the Online Campaigns Organizer for Change to Win, a partnership of seven unions and six million workers united together to restore the American Dream for everybody. He built his first Web site in 1995 and has been building online communities professionally since 1998. To read more of his work, visit the Change to Win blog, CtW Connect, at http://www.changetowin.org/connect.


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NBC Labor Dispute Threatens Rockefeller Center Christmas Special

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A labor dispute is threatening NBC’s “Christmas in Rockefeller Center” telecast.

The National Association of Broadcast Employees and Technicians (NABET-CWA) Local 11, which represents nearly 3,000 of NBC’s producers, writers, and technicians, vowed Tuesday to “pull the plug” on Wednesday’s Christmas special -— which includes the lighting of the Rockefeller Center Christmas tree — over failed negotiations with NBC management. The union’s contract expired in March and the union says there’s been very little progress since talks began last year, describing NBC management as “increasingly hostile” in “ignoring the concerns of the union’s membership.”

“We can’t let the Grinch at NBC steal another Christmas from thousands of honest working people,” said NABET-CWA Local 11 president Ed McEwan. “This charade must stop. Christmas is supposed to be a time of goodwill, but the network’s management is trying to hide behind their fancy lights while leaving their employees in the dark.”

The union has set up a website, NBCStoleChristmas.com, to air their concerns and attempt to avert a strike during Wednesday’s Christmas tree ceremony:

NBC did not respond to a request for comment on the union dispute.

*This article originally appeared in The Huffington Post on December 1, 2009. Reprinted with permission from the author.

About the Author: Danny Shea is the Media Editor of the Huffington Post. He is a graduate of Princeton University, where he majored in the Woodrow Wilson School of Public and International Affairs.


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Big Business’s Skewed View on Paid Sick Leave

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In the last couple of weeks, there’s been a rise in the debate over H1N1 and paid sick leave policy. Emergency H1N1 legislation has been introduced by Sen. Chris Dodd that would require employers with more than 15 workers to provide seven days of paid sick leave if they or their children come down with either H1N1 or seasonal flu.

Big business, however, appears to be completely in denial over the importance of the issue.

As the self-described “voice of business,” the U.S. Chamber of Commerce claims to represent the viewpoint of both large and small businesses on sick leave policy, and according to Mother Jones, insists that a global epidemic is not a good reason to start treating employees like human beings:

“The problem is not nearly as great as some people say,” said Chamber Vice President Randel K. Johnson. “Lots of employers work these things out on an ad hoc basis with their employees.”

President and CEO of the Small Business and Entrepreneurship Council Karen Kerrigan echoes this sentiment:

“Employers and their work force appear to be handling this challenge just fine without the federal government’s involvement. Unlike the problems that the government is having getting the flu vaccine out to Americans, employers and organizations are working through this national health emergency quite smoothly.”

Uh, we beg to differ, Randel and Karen. As a direct result of relying on voluntary employer policies to provide paid sick leave to employees, over fifty million U.S. workers have no paid sick days at all!

As the swine flu spreads across the nation — and the CDC continues to advocate for flu sufferers to stay at home until the fever goes away — the significant portion of the American workforce that faces a tough choice about whether to call in sick or go to work sick (and still get paid) has ramifications for us all. Lack of paid sick time for millions of American workers could increase the spread of this year’s flu pandemic and other infectious diseases. But the fact remains that many workers don’t even have the option of taking a paid flu vacation, as the Chamber advocates. They can’t risk losing their jobs, or their already too-small paychecks won’t allow a day (or more) of missed wages.

Paid sick leave not related to unemployment

When sick workers are on the job, it costs our national economy $180 billion annually in lost productivity.
When sick workers are on the job, it costs our national economy $180 billion annually in lost productivity.

Business groups like the National Federation of Independent Business and the National Small Business Association say the sick leave bills introduced in Congress come at a time when small businesses owners are struggling to keep afloat–and that covering the costs of mandated sick days could cause employers to have to lay off employees. Despite these frequent claims from some in the business community, a recent study from the Center for Economic and Policy Research (CEPR), a nonpartisan think tank, found no correlation between paid sick days and unemployment.

Another major new study by researchers at Harvard and McGill Universities — the largest ever to look at working conditions worldwide — finds that a week of paid sick leave would cost a business just 2 percent more in wage costs. The study’s authors also say the documented increase in productivity due to better working conditions would easily earn back the investment.

Paid sick days are critical to the ability of working Americans when they or their children are sick and to prevent the spread of the swine flu pandemic. Think about it this way: wouldn’t you prefer food service workers and restaurant workers did not work sick? How about care providers that look after your child while you’re at work, or the home care workers that help your parent with daily tasks so they can continue to live at home?

Sane public health policies increase quality of life in a cornucopia of settings–and maybe if we remind the U.S. Chamber of Commerce about this enough times, they’ll realize how absurd lobbying against legislation that would help with these issues is.

Not likely…but still worth a try. Tell the Chamber to cease lobbying against an emergency bill to give workers seven days of paid sick time per year: http://action.seiu.org/chamber.

*This post originally appeared in SEIU Blog on November 25, 2009. Reprinted with permission by the author.

About the Author: Kate Thomas is a blogger, web producer and new media coordinator at the Service Employees International Union (SEIU), a labor union with 2.1 million members in the healthcare, public and property service sectors. Kate’s passions include the progressive movement, the many wonders of the Internet and her job working for an organization that is helping to improve the lives of workers and fight for meaningful health care and labor law reform. Prior to working at SEIU, Katie worked for the American Medical Student Association (AMSA) as a communications/public relations coordinator and editor of AMSA’s newsletter appearing in The New Physician magazine.


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