Bills would provide remedies for wage theft

The Business and Labor Committee heard testimony Feb. 4 on two bills that would provide protections and remedies for victims of wage theft.

LB177, introduced by Papillion Sen. Jim Smith, would authorize the state labor commissioner to investigate cases in which employers fail to pay their employees wages under the Nebraska Wage Payment and Collection Act.

Under the bill, the commissioner may assess civil penalties up to $1,000 per violation of the act and also may determine whether an employer is liable for waiting time damages of 50 percent of the wages that are owed to the employee. Violations would be a Class IV misdemeanor.

Employees currently must take civil action against employers to collect their unpaid wages, Smith said, which is an unnecessary financial burden to employees who are owed money.

Abbie Kretz, a senior organizer for the Heartland Workers Center, testified in support of the bill, saying the center has received numerous complaints from employees who are owed up to $30,000 in unpaid wages. Such cases typically involve entry-level positions, she said, so the affected workers rely heavily on each paycheck.

Latino Center of the Midlands executive director Carolina Quezada, testified in support, saying the bill would protect communities and families from unfair labor practices. Certain employers are not fulfilling their contractual agreements to low-income workers, she said, and workers feel too powerless to take civil action against them.

A related bill was introduced by Omaha Sen. Heath Mello. LB560 would require employers to:

• provide employees with 30 days’ written notice before altering the employees’ wages;
• provide employees with an itemized statement listing their wages and deductions on each payday; and
• keep employment records for at least five years if they fall under the Nebraska Fair Employment Practice Act or longer if required by the Nebraska Equal Opportunity Commission.

The bill also would prohibit retaliation against individuals who oppose an unlawful employer practice or who testify, assist or participate in an investigation, proceeding or hearing. The labor commissioner could subpoena records and witnesses in such cases.

Violations would be considered a Class IV misdemeanor.

“Wage theft is a problem affecting millions of workers across the country,” Mello said. “Over 60 percent of employees nationwide suffer some type of wage theft on a weekly basis.”

Nebraska ranks in the bottom 10 states for providing employee protections against wage theft, he said, so the bill would provide additional methods to enforce such laws and protect employees.

Kretz testified in support of LB560, calling it an effective preventative approach to wage theft.

“Making [wage theft] a misdemeanor is the first step to deterrence and employers will think twice about not paying employees,” Kretz said.

Kevin Hilton of the North Central States Regional Council of Carpenters, also testified in support, saying that wage theft is common and affects many carpenters in Lincoln and Omaha. Contractors who fail to pay employee wages have less overhead costs and reduce their project bids by about 30 percent, he said, which eliminates a competitive balance in the industry.

Commissioner of the Nebraska Department of Labor Catherine Lang testified in a neutral capacity on both bills, saying the department receives about 33,000 annual complaints from employees who are victims of wage theft. She said more investigations would be conducted and the department’s workload would increase if either of the bills were passed.

No one testified in opposition to the bills and the committee took no immediate action on them.