Advocacy group warning seasonal workers: don’t fall victim to wage theft

WASHINGTON, DC – This holiday season, the National Consumers League (NCL), the nation’s oldest consumer organization, is issuing a reminder to the thousands of part-time and seasonal workers of their rights and protections under federal labor laws and warning them about the prevalence of abuses in the workplace. With the holiday shopping season in full swing, retailers across the country are taking on extra help to manage the holiday crowds.  According to the Bureau of Labor Statics, retailers hired more than 18,000 new workers in October alone.

With the national unemployment rate stuck around 9 percent, seasonal work will provide many American workers with much-needed wages; however NCL is warning new hires of the many pitfalls in the workplace that often lead to wage theft, in which workers don’t receive the compensation they are rightfully owed.

“Part-time and seasonal workers are often more vulnerable to wage theft,” said Michell K. McIntyre, Project Director of NCL’s Special Project on Wage Theft. “Many workers sign onto the temporary work, grateful for the opportunity and without paying full attention to company rules and policies governing compensation and benefits. Short-term, seasonal work also often moves at a faster pace, and both workers and employers can forget critical pieces of information or paperwork that could affect how much a worker get’s paid.”

One of the most important pieces of information seasonal hires need be aware of is their worker classification – whether they are labeled as an employee or an independent contactor in their job description and tax forms.

A worker classified as an independent contractor is not entitled to employee rights under the Fair Labor Standards Act (FLSA). FLSA rights include:

• The right to the minimum wage and the highest rate available between the federal ($7.25 per hour), state, city, and county minimum wages
• Anti-discrimination protections
• Workers compensation and overtime pay
• Overtime compensation at 1½ times the regular hourly rate after working more than 40 hours per week for the same employer
• A workday that begins upon entering the workplace (including donning a uniform or setting up) and ends when leaving the workplace (including the time it takes to clean up or restock inventory)

Employers do not pay payroll taxes for independent contractors; contracted workers are on the hook for the back taxes to both the IRS and the state tax board when tax season rolls around. An independent contractor receives a 1099 tax form in place of a W-2 form.

NCL reminds workers that knowing the law and keeping proper records are critical in order to ensure that they are paid the amount they are owed. NCL recommends workers save all payroll stubs and double-check that the number of hours worked, rate of pay, paycheck deductions and that the official/legal name of the employer is correct. To help American workers calculate how much they should be earning, the US Department of Labor has created a free app for smartphones to help workers track their hours and determine the exact amount employers owe. The tool is exceptionally useful when there are any paycheck discrepancies.

“In these tough economic times, it’s important for workers to get every penny they are owed. The best way for workers to ensure accurate payment is to know their rights at work and who they can turn to for help,” said Sally Greenberg, NCL’s Executive Director.

For more information on wage theft, visit NCL’s Web pages on the subject.

Photo: Ben Margot/AP