State Failing To Protect Low-Wage Workers, Study Says

One consequence of a down economy is that employers are less willing to add full-time positions and more willing to hire un-benefited, low-wage temporary workers.

That's especially true of blue-collar jobs often filled by an immigrant workforce. Massachusetts has about 25,000 of these types of workers, and a report (PDF) published Tuesday by the Labor Relations and Research Center at the University of Massachusetts Amherst finds that many of them are exposed to safety risks and abusive working conditions.

WBUR's All Things Considered host Sacha Pfeiffer spoke with the report's co-author, Harris Freeman, an associate professor at Western New England University School of Law in Springfield, who says this problem exists in a wide range of industries.

Harris Freeman: We're seeing all kind of low-wage jobs, predominantly residential construction, fish and food processing, janitorial work, waste recycling, low-wage manufacturing and things like stone cutting. We've seen wage and hour abuses and health and safety problems in all these kinds of low-wage jobs.

Sacha Pfeiffer: What kinds of specific problems are these low-wage temporary workers dealing with and what kind of safety risks are they being exposed to?

One of the big challenges facing temp workers is that unscrupulous staffing agencies and low-road employers are using the temp agency employment relationship to offshore their legal responsibilities.

When you say "low-road" employers, you mean employers who are not taking the high road?

That's right. Employers who are ignoring our wage-and-hour laws and our health and safety laws, and the temporary employment relationship makes it easier for them to do that because the legal employer of the worker is the temp agency.

You cite one example of how this plays out: the worker who may be working well more than 40 hours a week, but the paycheck is split between the company where they're working and the agency that hired them, so they end up not getting overtime.

We've identified that kind of check-splitting scheme that is subjecting temp workers to wage theft in both the Chelsea area and in the Framingham/Worcester area. Splitting up the employment relationship in this way makes it easier for unscrupulous employers to exploit the workforce.

And, as a result, safety standards don't get enforced or they get under-enforced. Give us an example of some of the safety standards that are being ignored.

Well, for example, we've interviewed workers who are going to work as temps in the fish processing industry, and they are picked up by a temp agency and they have to pay for the transportation to the actual workplace, they're not told where they're going, not told in advance that they may need certain kinds of safety equipment or even clothing that allows them to work in a refrigerated work setting.

How much regulation, if any, does the state do of the temporary staffing industry?

We have in Massachusetts a law that governs employment agencies, and those are agencies like people who send models or actors out, or even find jobs for executives. Those agencies have been regulated. The law, when it was initially enacted, really didn't anticipate the kind of widespread use of temporary employment that we're seeing throughout the blue-collar and low-wage service sector in Massachusetts and elsewhere. And we're especially concerned about this because the forecast is that there is going to be ongoing rapid growth of the low-wage temporary workforce.

You also point out in your report that it's not only the workers who are hurt; the state loses revenue that it would have received if the workers were paying taxes, and employers that do pay taxes can't compete on wages.

That's right. What you're really seeing if you don't regulate this kind of unscrupulous conduct is you're going to really have a race to the bottom. You're going to be lowering workplace standards in the low-wage economy to make it difficult for those people who are law-abiding to stay in business.

Could you name one or two companies that you think are among the most egregious examples of this?

There was recently a company that was prosecuted by the attorney general's office in Worcester, Labor Solutions. They were prosecuted for wage theft — that is, wage-and-hour violations for not paying unemployment insurance, for not paying workers compensation, no contribution to federal Medicaid. And we really had, in that one company, a problem that not only exploited hundreds of temp workers, but at the same time was costing the state needed revenue.