State Vows Crackdown on Racetrack Labor Violations

The first time labor inspectors looked at working conditions in the stables of several California racetracks, they reported finding widespread abuse of minimum wage and overtime laws. But just as they prepared to expand their investigation statewide, their agency’s top brass ordered them to stop the probe.

That was 15 years ago.

Inspectors did not return to the racetracks until last summer, and they said they found the same pattern of violations--comparable to those seen in the agriculture and garment industries.

Now, officials from the state Department of Industrial Relations vow to continue enforcement sweeps throughout the year and possibly beyond, devoting at least four inspectors full time to coordinate the effort.

“We’re going to target them this year,” said Roger Miller, assistant chief of the division, who is running the investigation. “We’re going to make sure there is compliance with the laws.”

So far, inspectors have issued $92,150 in spot citations. But the amount is expected to climb much higher as they pore over records and interview the mostly immigrant work force that takes care of the thoroughbreds. Authorities will also determine how much the employers must pay their workers in back wages. Of 82 cases investigated, 72 are still open, Miller said.

The subjects of the enforcement action are some of the state’s 800 horse trainers, who range from wealthy tycoons and stakes winners to small-business owners struggling to scrape by. Many say labor officials are overstating the violations and that the trainers are guilty only of bad record keeping.

“My experience is that this whole thing paints the trainers in a bad light, like they’re the bad guys,” said Ed Halpern, executive director of the California Thoroughbred Trainers. “And they’re not.”

Halpern said trainers didn’t keep records because they thought they were exempt from overtime laws and, more generally, operate in an antiquated business world where things are done more casually.

“We still don’t have an outpouring of employees who say they’ve been shortchanged or cheated, and I don’t think the labor commissioner does either,” he said.

The workers consist of grooms--who feed, clean, bandage and generally tend the horses--and hot walkers, who cool them down after a run. They follow the racing circuit to different tracks throughout the year and often live in small equipment rooms in the stables, so they can be near the horses in an emergency.

At Santa Anita last week, half a dozen grooms and hot walkers told The Times they welcomed the labor authorities’ attention but expressed mixed feelings about whether their situation has improved since the sweeps, which ended in September.

“There’s lots to do, but there’s been lots of improvement,” said Johnnie Gholston, 66, a groom who has been working at Southern California tracks for more than 30 years.

After the inspectors rolled through the tracks last summer, Gholston said, his boss began recording his hours, paying overtime and giving him a day off. Like most stable hands, he had been working seven days a week.

“I think some [bosses] will change, and some will revert to the same old routine,” he said.

But he added that workers have grown bolder about making demands. Some colleagues at a nearby stable even got a regular day off after threatening to walk out on the job, he said.

Others interviewed by The Times said the working conditions changed for only a couple months last summer, during the enforcement action.

“Everyone was happy; everyone was hopeful,” said a 42-year-old groom, who asked to be identified only as Javier. “But it’s still the same problem. We don’t get overtime, and we don’t get a day off.”

On another front, however, there have been noticeable improvements at the track. Since Los Angeles County health officials threatened to prohibit workers from living in the stables, Santa Anita has invested more than $3 million in the living quarters, officials said.

Linoleum has been installed over the concrete floors. The doors have been sealed to prevent rats and mice from scurrying around the workers’ cots. And the bathrooms, which were filthy and deteriorating before, have been spruced up.

Officials at Magna Entertainment--which owns Santa Anita in Arcadia, Golden Gate Fields in Albany and Bay Meadows in San Mateo--said they hope to eventually build dormitories with cooking facilities and private bathrooms.

Golden Gate Fields was known for having the worst living conditions of the major tracks, with rotting wood, leaking roofs and paint coming off in sheets. There, Magna officials say, they have conducted major renovations in the last four months and recently invested more than $3.5 million.

“California is so far ahead,” said Jack Liebau, president of Santa Anita and Golden Gate Fields. “Most of the people on the backside, they’re happy. They don’t feel like they’re being exploited.”

Though labor officials say there are extensive problems still, they agree that conditions may be improving. Officials with the U.S. Labor Department, which is helping the investigation, said trainers “seemed to be responsive” after being informed of the violations.

Miller said he had seen an improvement in bookkeeping during his agency’s last inspections in September. He was also surprised that there were very few workers’ compensation violations or employers who were not properly withholding taxes.

But he said that overtime and minimum wage violations were significant, and that the trainer with no problems was “the exception.”

Inspectors say they find many cases in which employers have paid a salary based on the minimum wage for 40 hours, when, in fact, employees are working more hours.

Many of the workers are vulnerable to abuse because they are undocumented immigrants, despite having been licensed by the California Horse Racing Board, he said. And in the insular world of the stable area--called the backstretch--few complaints about wages or other mistreatment ever reach the outside world.

“At one time, the racetracks were handling their own wage claims,” said Miller, referring to industry judges, called stewards, who deal with track disputes.

Miller was the man who headed the original enforcement actions in 1985 and was called off by his boss, after investigating the conditions only at Del Mar and Santa Anita. He said he does not know what happened behind the scenes to provoke the order to stop.

“We were going to check all the tracks because there appeared to be problems everywhere,” he said. “But we were given instructions that . . . you cannot do an industrywide enforcement.”

Most officials agree that horse racing should be easier to clean up than the farming and garment industries. The 4,000 stable workers and their bosses are all licensed by the California Horse Racing Board and work at only 15 confined locations--six major tracks and nine fairgrounds.

The renewed focus on the backstretch began after an article in The Times last April documented poor living and working conditions across the state. The horse racing industry, which spends millions of dollars lobbying in Sacramento, had won exemptions from state labor and housing laws. Stable employees were some of the only workers in the state who could work seven days a week, year-round, without getting overtime.

The industry later lost that exemption.

After the story, lawmakers moved to clean up the situation, proposing legislation to make it easier for the workers to unionize and bring the living quarters under the state housing authority. Under the bill, the trainers would have had to submit their payroll records for annual audits.

At the last minute, the bill’s author, Assemblyman Herb Wesson (D-Culver City), and other lawmakers included a provision that would have legalized Internet and telephone betting in California. It passed the Legislature with almost unanimous support. But Gov. Gray Davis vetoed it over concerns that it would foster gambling. “If the bill contained only the backstretch provisions, I would sign it,” Davis said.

Lawmakers plan to reintroduce the bill, without the Internet provision.

Assemblyman Darrell Steinberg (D-Sacramento), who co-wrote last year’s bill, said cleaning up horse racing is, in ways, a test of the state’s ability to regulate much larger industries.

“When it comes to underground economies, this is a finite problem,” he said. “If we can’t as a state successfully grapple with the problems of this industry, we are going to have much bigger problems dealing with much larger industries.”