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Monday, January 5, 2009


Department of Labor Disburses $24.6 Million to 17,000 New York Workers Whose Wages Were Illegally Underpaid

Aggressive Enforcement Efforts Lead to Highest Recovery of Underpayments in More a Century at Labor Department
Governor David A. Paterson today announced that a record level of illegally underpaid wages were recovered for New York workers in 2008. Through enhanced enforcement of existing labor laws, the New York State Department of Labor collected and disbursed $24.6 million for more than 17,000 workers across the State. These recovered wages represent the largest amount of collected and distributed monies in the Labor Department's 100 years of existence.

The Division of Labor Standards – which enforces minimum wage, overtime, child labor, and other basic labor laws – overhauled its approach in the past year, embarking on proactive and targeted investigations instead of relying solely on complaints. These efforts have focused on low-wage industries with high rates of violations. The Department's "Labor on Wheels" mobile unit has also helped build relations with community groups to identify significant cases.

"It is unacceptable for employers to take hard-earned money from their workers, particularly in this time of economic crisis, especially considering the worst abuses happen to those New Yorkers who can least afford it," said Governor Paterson. "I commend Labor Commissioner Patricia Smith and her staff at the Department of Labor on a job well done. While the majority of employers in our State do play by the rules, the Department of Labor has uncovered abuses that will not be tolerated in New York."

The Labor Department's Bureau of Public Work disbursed more than $7.1 million to 2,125 workers, while the Division of Labor Standards distributed more than $17.5 million to approximately 15,000 workers. The total underpayments recovered by the Division of Labor Standards in 2008 represent an increase of 23 precent over 2007 underpayments, and an increase of 38 percent over 2006 figures. There are even more ambitious plans for 2009, including continued targeted and proactive investigations, as well as implementation of a systematic program to re-inspect prior violators.

Labor Commissioner M. Patricia Smith said: "These numbers show how serious this problem is in New York State, and demonstrates the need for aggressive enforcement. Lax enforcement emboldens employers to cheat workers. In this tough economy, it is more important than ever to make sure employers pay workers all of the wages they have earned. We will continue to be creative and aggressive in protecting the basic rights of this State's workers."

New York State AFL-CIO President Denis Hughes said: "The New York State AFL-CIO applauds Governor Paterson and Commissioner Smith for their outstanding efforts on behalf of those workers who were mistreated and underpaid. During these difficult times, every dime and every dollar count. All New Yorkers, particularly our working men and women, can be proud of the proactive approach taken by the Governor's administration in dealing with this most important issue."

Stuart Appelbaum, President of the Retail, Wholesale and Department Store Union, said: "This past year, we have worked closely with the State of New York to enforce existing wage laws, rightfully returning millions of dollars in back wages and overtime pay to hard working retail workers and their families. We simply cannot allow workers in New York to be exploited. This is particularly critical during these economically uncertain times when every penny matters to working families."

Labor Standards investigations throughout the State in 2008 show the extent and scope of the violations.

    A state-wide investigation found more than 78 percent of inspected car washes in New York City were in violation of minimum wage and overtime laws.
    At Jin Shun, Inc., a New York City garment manufacturer, more than 270 employees had been bilked out of nearly $6 million since 2002. Additionally, management kept two sets of books and payroll records, and gave employees a "cheat sheet" of questions and false answers to give Labor Department inspectors.

    Bathroom attendants at the Erie County Fair were paid no wages for their work and were forced to turn over half of their tips to the Portlock Maintenance, Inc., the contractor in charge of hiring them.

The Bureau of Public Work enforces the State's prevailing wage law, which regulates the wage to be paid to employees on public works projects, or projects built by government entities for public purposes. The Bureau often uncovers serious violations in which companies willfully underpay workers despite having experience or knowledge regarding the law's requirements. For example, in November 2008, the Bureau issued findings against CNY Mechanical Associates in Onondaga County, concluding that 18 workers on two projects were collectively owed $67,960. As a result of this investigation, the company was debarred from any public work contracts with the State, any municipal corporation or public body for a period of five years.

In order to facilitate compliance, the Labor Department has also made extensive efforts to educate employers about their legal obligations. For example, the Bureau of Public Work participated actively in the Long Island Labor Advisory Council, or LILAC, which has provided a number of forums over the past year to educate stakeholders on Long Island that administer public work projects about compliance with Labor Law. The Labor Department is planning to replicate these efforts in the Hudson Valley and the Capital Region in 2009.

For more information about the Department of Labor's enforcement efforts, please visit

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