MEMPHIS, Tenn. – Kyle Kordsmeier was at church every night last week. Kordsmeier visited different congregations in Shelby County as part of an effort by Workers Interfaith Network (WIN) to build a coalition of “unions, churches, and community groups” to stand against wage theft.
The campaign hopes to put pressure on the Shelby County Commission to “develop a process so that workers can file complaints against employers who refuse to pay them.”
Wage theft is already illegal in the State of Tennessee. The problem, according to Kordsmeier, is enforcement. “The [state] Department of Labor has two investigators for all of West Tennessee and neither [of them] is Spanish speaking,” he said. Furthermore, the Department of Labor will not take a case unless the reported theft is at least $1,500. For many families living paycheck to paycheck a loss of even one quarter of that amount can be devastating.
Many people assume that wage theft is a problem that the “free market will take care of itself.” It is assumed that workers whose wages are stolen will simply quit and criminal employers will have to reform their business practices or they won’t be able to maintain a workforce. “The thing is,” Kordsmeier says, “that isn’t true.” In this economy, “people will work for anything – or the promise of anything.” Considering that it is impossible for many of these workers to spend money on legal fees, many “don’t pursue their cases because they can’t afford to.”
Kordsmeier acknowledges that some employers steal wages in an effort to keep their businesses afloat. However, once employers steal a worker’s pay and avoids significant repercussions to their business the likelihood that they will do so again increases. Ideally, Memphis workers would have the same protection as workers in Seattle. “If it is proven that they intentionally didn’t pay them, [Seattle] workers can earn treble compensation,” according to Kordsmeier “and that just stops it.”
Last year alone, Workers Interfaith Network received 275 reports of cases of wage theft. Kordsmeier estimates that the average amount stolen from these often low-wage workers is $1,500. Based on these figures, companies who commit wage theft effectively depress the economy of Shelby County by nearly half a million dollars annually. Since many cases go unreported, the detrimental effect of wage theft on the local economy is likely many times that amount.
In his experience, Kordsmeier has found that “a lot of companies that commit wage theft also avoid paying taxes.” Passing a countywide ordinance fining companies who steal pay “will help put a lot of money back into the local tax base.”
“Considering that we do not have a local income tax,” he said, the people of Shelby County stand to benefit greatly from the revenue generated by fining companies who criminally exploit their workers.
Without an ordinance, companies are largely free to steal from their workers as often as they care to. Today, Workers Interfaith Network is the only recourse for many victims of wage theft in Shelby County. Once a case is reported to WIN, the case “goes to a committee of low wage workers who have experienced wage theft” for approval, Kordsmeier said. After the case is approved, he said, “we send a letter [to the employer] that sets up a payment plan that the worker agrees to.” If a business refuses to negotiate, “we take public action.”
Before heading off to another church service, Kordsmeier suggested that everyone who wants to help end the wage theft epidemic in Shelby County “sign up for the coalition online.” While WIN has already brought together over 20 local businesses, congregations, and unions to urge the Shelby County Commission to pass a local wage theft ordinance, he said, “we still need help.”
Photo: Courtesy of Interfaith Workers Justice.