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Many More Workers Are Being Exploited, County Report Says

Times Staff Writer

Worker exploitation has increased dramatically in Orange County, and it will end only if government agencies are given the resources to investigate complaints against employers and enforce existing labor laws, according to a county Human Relations Commission report released Friday.

In the past 3 years, the number of workers complaining to the commission about abuse at the hands of their bosses has more than quadrupled, the report says. Non-payment of wages is the most common labor code violation, and undocumented workers are the most common victims.

“The Division of Labor is undermanned and is not able to investigate adequately the number of complaints,” said Dr. Daniel H. Ninburg, chairman of the commission. “With the collection of lost wages from the employers, there’s difficulty in follow-through.” The result is a growing class of workers who cannot pay for rent, food or medical care but who fear losing their jobs, bad as those jobs may be.

In 1985, the Human Relations Commission received about three or four worker complaints a month; by spring, 1988, the average number was 20. The commission convened a forum on Labor Day to find out why there are so many more complaints now and how to address them.

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What they heard was a litany of complaints from workers, overloaded social service groups and law enforcement agencies and from ethical employers who argued that they cannot afford to compete with their unscrupulous counterparts.

The commission based its report and recommendations on testimony heard at the forum.

At the heart of the matter, the report says, is the so-called underground economy, “an extensive black market” that not only affects workers and employers but also robs the state and federal governments of tax revenue and adds to the burden on social service agencies.

The employers at fault, experts say, pay cash when they pay wages at all, keep no records and fail to provide mandated safeguards for their workers.

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In 1985, the last year the underground economy was studied in depth in California, the Commission on California State Government Organization and Economy estimated that such activity accounted for as much as $40 billion in business transactions annually and defrauded the state of more than $2 billion a year in taxes.

Among the major findings in the report:

- There is an “alarming incidence,” particularly in the construction and landscaping industries, of workers being abandoned without being paid.

- The State Labor Code is unclear regarding the extent of the state Labor Commission’s ability to collect wages on behalf of defrauded workers. There is, therefore, a “low success rate” in collecting from employers who ignore commission decisions.

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- Labor commission budget cuts, including the 25% reduction in 1983, have “severely limited that agency’s ability to adequately handle the labor abuse that exists.”

- Workers’ ignorance of their basic rights and their fear of retribution compound the problem, as does the fact that many employers are unaware of basic labor code provisions.

- Exploitation of domestic workers “goes relatively unchecked.” Further, when these workers are terminated without pay, “they are not only unemployed but also left homeless.”

The report makes a score of recommendations for ways to combat the problems and to educate the workers.

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The report will be sent to the Board of Supervisors, government leaders in each of the 28 cities in Orange County and to the Legislature, Ninburg said.

“I think one of the most important recommendations is for the state Legislature to pass legislation clarifying the responsibility of the labor commission to carry through the collection process,” Ninburg said.

“And I think we have to educate employers and laborers as to the rights of the laborer and the responsibilities of the employer.”


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