How companies rip off poor employees — and get away with it

U.S. companies that cheat their workers out of pay are unlikely to be fined or punished even after they're caught.

Video Transcript

MIKE HOUSEHOLDER: Ruth Palacio and her husband, Arturo Ziello are trying to make ends meet, but they're barely getting by. They can no longer send money back to family in Mexico.

RUTH PALACIO: [SPEAKING SPANISH]

MIKE HOUSEHOLDER: From the early days of the pandemic through the summer, the couple had steady work disinfecting the hospital rooms at Memorial Sloan Kettering in New York City.

RUTH PALACIO: [SPEAKING SPANISH]

MIKE HOUSEHOLDER: The couple worried about getting sick, but they thought it would be worth it, until they started getting their paychecks. They said they were paid a fraction of what they were owed, making their hourly pay often less than minimum wage.

RUTH PALACIO: [SPEAKING SPANISH]

JENNIFER LEE: It's something that is absolutely prevalent among workers, particularly low wage workers.

MIKE HOUSEHOLDER: The Center for Public Integrity found that companies have little incentive to follow the law. In 2019 alone, the US Department of Labor cited 8500 employers for stealing $287 million from workers. An analysis shows the department rarely penalizes repeat offenders, and companies are more prone to cheating employees of color and immigrant workers.

JENNIFER LEE: It doesn't matter that you don't have work authorization. If you perform the work, you need to be paid for it. And if you somehow qualify for overtime, for example, you need to be paid overtime.

MIKE HOUSEHOLDER: And during the pandemic workers have been more reluctant to come forward for fear of losing their jobs, but not Fidel Martinez. A demolition contractor owed Martinez and his co-workers more than $20,000 for knocking down several Walgreens stores and other structures. Martinez had to borrow money from friends to pay his bills, until a local nonprofit helped him recover his wages.

FIDEL MARTINEZ: [SPEAKING SPANISH]

MIKE HOUSEHOLDER: Palacio and her husband are suing the contractor hired by the hospital and its subcontractors. The hospital didn't respond to requests for comment, and in court records BMS CAT denied paying cleaners less than the minimum wage or owing them overtime pay.

RUTH PALACIO: [SPEAKING SPANISH]

MIKE HOUSEHOLDER: Workers say they simply want what is owed to them. Mike Householder, the Associated Press.