Throughout L.A., people toil unnoticed in jobs for less than minimum wage. And their numbers are increasing. : Working for Less
At a popular Thai restaurant near east Hollywood, lunch for two costs about $15--the same amount waitresses there are paid for an eight-hour workday.
That’s $1.88 an hour, less than half the $4.25 hourly minimum wage. Only with tips and by working six days a week does she manage to stay above the federal poverty line of $7,551, earning $10,900 annually. As politicians and economists debate a Clinton Administration proposal to raise the minimum wage to $5.15 an hour, workers like those in the restaurant toil unnoticed in the inner city for employers who flout longstanding labor laws.
Linda, 20, a waitress who worked in the restaurant until last month, said she knows that job--and the waitress job she now has at another restaurant for $20 a day--is exploitative. But she feels it’s the best she can hope for. “I know it’s not fair, but I don’t have a choice.”
Her plight is common throughout Los Angeles and the state, where labor officials say that the number of workers who are paid less than the minimum wage has swelled in the past 10 years.
Though exact numbers for Los Angeles are unavailable, the U.S. Bureau of Labor Statistics estimates that 129,000 hourly workers in California are paid less than the minimum wage. And labor officials said that the number of workers whose pay amounts to less than the minimum may be higher, since they did not count workers paid a flat weekly or monthly salary. The bureau changed its method of counting such workers last year, so the 129,000 figure for 1994 is not comparable to the 79,000 sub-minimum wage workers reported in 1993.
State and federal labor officials who enforce wage laws say the violations are most common in garment factories and small businesses such as restaurants. But larger stores and construction companies are often among those cited as well. Underpaid workers now clean offices, bag groceries, build houses or sew garments for pay less than the minimum wage.
“I see horrible situations of abuse and exploitation,” said Jose Millan, the state’s assistant labor commissioner. One of the biggest recent cases involved a Koreatown supermarket that faces $1.2 million in fines and other penalties for allegedly underpaying 167 workers and improperly withholding funds from their paychecks over two years, among other violations. The case is pending.
Such conditions are byproducts of bigger upheavals in California, the nation and world. The flight of manufacturing jobs from Los Angeles, the influx of immigrants and cutbacks in government agencies responsible for enforcing labor laws have each played a role in lowering wages.
From 1979 to 1994, 286,000 manufacturing jobs were lost in Southern California as aerospace, auto and other plants closed, according to Goetz Wolff, a UCLA labor economist who tracks Southern California employment patterns. Many of the jobs paid high wages and provided medical and other benefits to those without skills or schooling beyond high school.
Meanwhile, the number of service and garment industry jobs, which typically are low-paying, increased, Wolff said. These jobs, he added, are now the dominant entry-level jobs for unskilled workers.
“The rungs in the ladder of opportunity were ripped out,” Wolff said, by plant closings and the rise in hotel, restaurant and sewing jobs.
The Argumedo family knows what it’s like to fall from the ladder. Throughout the 1980s, the family lived comfortably on the money Tomas Argumedo, 58, made working in a furniture factory. When the plant closed in 1991, Tomas, his wife Amelia and son Thomas joined the low-wage work force. Unable to find other jobs, they agreed to clean by themselves an eight-story office building on 6th Street in Koreatown for $1,200 a month--$3.33 an hour.
Five days a week, the family left their Lynwood apartment in their ’77 Buick to clean the building, which took them six hours each day. After three months, the cleaning contractor who employed them cut their pay to $800 a month, or $2.22 an hour. They were even asked to pay $30 a month for parking, which they refused to do.
The Argumedos often were paid late, or given only a fraction of their pay on time, with the rest coming weeks later. The contractor could not be reached for comment. Labor officials say such practices are common among small employers who pay workers in cash.
The Argumedos would often miss rent or other bill payments while waiting to be paid, and would later have to pay penalties to creditors. In late 1993, their employer stopped paying them altogether, saying that his business was faltering and that he would pay them as soon as he could come up with the cash.
With no money coming in, the family relied on help from relatives and whatever dollars they could come up with through odd jobs to get by, recalled Thomas Argumedo, 22. “I was collecting cans, working at swap meets, anything to come up with some money,” he said.
Thomas remembers everyday mishaps becoming small tragedies. He recalls spilling coffee on his pants at home one day. With no dryer, he couldn’t clean them in time for work. So he cleaned the building that night in his only other pair of pants--his best dress trousers.
The cleaning company went out of business in mid-1994, leaving the Argumedos without four months’ pay, which they still have not recovered. Tomas Argumedo now has another cleaning job with pay above minimum wage, and Thomas has a $5-an-hour construction job with health benefits.
The family is now working with Korean Immigrant Workers Advocates, a Koreatown group that helps workers claim lost wages and benefits from employers, to recover the money they are owed by their former employer.
The family’s experience with a fly-by-night employer is common in Los Angeles, according to assistant labor commissioner Millan. “Los Angeles is one of the most dynamic enterprise zones in the world. But that strength is also its major flaw. Businesses come and go and with each incarnation there are a lot of lives that are involved, people who don’t get paid.”
But worker abuse is not limited to small mom-and-pop start-ups. One of the biggest wage violation cases handled by state officials occurred at the California Market, a supermarket on Western Avenue that is a Koreatown landmark.
The Division of Labor Standards filed civil charges in February against the market based on a two-year investigation in which state investigators found 1,982 alleged violations involving 167 workers at the market.
A labor investigator who worked on the case said that workers in the market were paid $220 weekly for working 60 hours--$3.67 an hour. The market also took a 5% payroll deduction from workers, falsely telling them the money was being withheld for taxes, according to the investigator. The company faces back wages and penalty payments of as much as $1.2 million if there is a judgment against it.
California Market’s attorney, Donald H. Steier, declined to comment on the charges, saying: “We’re still attempting to clarify the extent of the allegations. We don’t know with any degree of certainty what happened.”
Undocumented immigrants are especially vulnerable to abuse. Many will accept low pay in exchange for a job, since it is illegal for businesses to hire undocumented workers. Even those who know they are being exploited will not report their employers to state or federal authorities for fear of deportation.
Linda, the Thai restaurant waitress, is one such worker. She quit working at the restaurant and now works at another nearby at which she earns $20 for an eight-hour day ($2.50 per hour). Linda, who came to the United States from Thailand four years ago on a tourist visa, said she is afraid to complain to authorities because she fears losing her job or being deported. She asked to be identified only by her first name.
Even legal immigrants, however, can be victims. Danny Park, case management director for Korean Immigrant Workers Advocates, said that many of his clients work for employers who take advantage of immigrants who are unaware of labor laws.
Park said that many Korean immigrants who were professionals in Korea will also put up with poor working conditions because they plan to quit someday and start businesses, even though many never reach that goal.
“They don’t identify themselves as laborers, so they’ll put up with a lot of abuse without fighting back. They might act differently if they see their job as something they’ll be doing for the rest of their lives,” he said.
Workers who fight back have gotten results. The investigation of California Market came after groups of more than 20 workers repeatedly went to the Los Angeles office of the state labor commissioner to complain about their treatment.
But Roy Hong, executive director of Korean Immigrant Worker’s Advocates, said that incidents like the California Market case reveal flaws as well as strengths in the system. “There’s not much enforcement presence in the city, the federal and state officials rely on workers to come to them. They’re fishing instead of hunting.”
The federal Wage and Hour Division had 75 inspectors in Southern California in 1980, compared with 45 today. Budget cuts reduced the state labor commission’s Southern California staff by about 40% since 1988.
Assistant labor commissioner Millan, however, said that by targeting specific industries and working with other state and federal agencies, authorities have been able to contain violations of minimum wage laws. “There hasn’t been a dramatic improvement, but it’s no longer getting worse,” he said.
One such targeted sweep occured in April. The state Division of Labor Standards Enforcement investigated 45 Los Angeles garment factories and found violations, including record keeping and child labor offenses, at 34 of them. The firms are now being audited for wage violations, and department officials said that they expect to find violations at many of the firms, since those that have record-keeping violations typically break wage laws as well.
Rolene Otero, district director of the U.S. Department of Labor’s Wage and Hour Division, who has worked on wage issues in Los Angeles for 20 years, said she believes wage violations are on the rise in Los Angeles, a change from the 1970s, when sub-minimum wages were more common on farms than in the city. “We don’t see the kind of minimum wage problems with farm workers in Ventura County that we now do with restaurant workers in Los Angeles.”
Not only are sub-minimum wages more common in restaurants and garment factories, but wages are also falling in other industries, because of a sluggish economy and increased use of subcontractors.
Otero said that her department is now working on a case involving one of the region’s largest home builders, in which construction workers were paid less than the minimum wage. “We’ve not seen minimum wage problems in construction in the past, but there are real problems now and I expect to see more.”
So pervasive is the downward pay spiral, Otero said, that wage violations are now even turning up in the film industry, as studios rely more on small subcontractors to produce films. “Today the garment industry may be where the problems are, but construction is getting worse and the next to go will be the motion picture industry.”
Meanwhile, many of those who already struggle to survive on their meager pay work on, with little hope of better pay. Linda, the waitress, said that even at $2.50 an hour, her job is greatly in demand. “I’m nobody. I’m in no position to bargain. There are so many thousands of others who could take my job, I’m nobody special.”
ON THE COVER
The nation may have a minimum-wage mandate, but the law means little at many Los Angeles businesses. A growing legion of inner-city workers are working for as low as $1.88 an hour. In this employers’ market, the six-day workweek is not uncommon.
Amelia and Tomas Argumedo agreed to work for a building-maintenance contractor after the furniture factory where Tomas had made a comfortable living closed its doors in 1991. The pay worked out to only $3.33 an hour, and the arrangement got even worse when, they say, the contractor stopped paying them. Today, with the help of Korean Immigrant Workers Advocates, the Argumedos are trying to get the four months’ pay they say they have coming.
