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“You can’t call yourself the boss if you don’t (bleep)-ing pay them!”

-Celebrity Chef Gordon Ramsay

“Hotel Hell” premiered on Fox last night, bringing potty-mouthed celebrity chef Gordon Ramsay into the underworld of mismanaged hotels and their restaurants. On his other shows, Ramsay usually offers some enjoyable brain-rot as he formulaically transforms the mismanaged establishments  and their hard-headed owners with cutting, blunt talk that culminates in the owner’s teary-eyed realization of the errors of his or her ways. A transformation of character results, usually aided by a free restaurant makeover thanks in part to our sponsors.

Instead, Monday’s episode (which ended in a cliff-hanger) was a textbook example of rampant wage theft at the Juniper Hill Inn, in Windsor, VT.

It’s a beautifully appointed hotel whose owners have spent a fortune on antiques and art for rooms but who don’t pay their own staff regularly. Read More

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For the roughly 646,000 workers in North Carolina supporting themselves and, in many cases, their families on $7.25 per hour, a federal increase of the minimum wage to $9.80 per hour could bring an annual wage (for a full-time, year round worker) to $20,384. While this annual wage continues to be approximately half of what it actually takes for the typical North Carolina family of three to afford basic expenses, it would be an extremely important step in the right direction. An increase would help struggling families across the state, while at the same time providing a much-needed boost for the economy.

A new report released today by the Economic Policy Institute takes a closer look at the potential impacts of The Fair Minimum Wage Act, introduced by Sen. Tom Harkin (D-IA) and Rep. George Miller (D-CA) on July 26, 2012. The proposed increase would raise the federal minimum wage from the current $7.25 to $9.80 by 2014, through three incremental increases of $0.85 and raise the tipped minimum wage, currently sitting at $2.13 per hour, to 70 percent of the regular minimum wage.

The report examines the demographic characteristics of affected workers and finds, for instance, that contrary to the perception that most minimum wage workers are teenagers, 92 percent of those who would be affected by a minimum wage increase in North Carolina are at least 20 years old. Similarly, data on educational attainment of those who would be affected by an increase shows that 44.6 percent have some college education, an associate degree or more.

While increasing the minimum wage immediately benefits the lowest-paid workers through boosted earnings, it also has positive effects on the larger economy. Raising the minimum wage puts much needed earnings into the hands of those who need it most, and are most likely to spend in the local economy. The report notes that the GDP impact for North Carolina is estimated to be close to $848 million with the possibility of an additional 3,400 net new jobs created in the state.

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Today, on the three-year anniversary of the last increase in the federal minimum wage, a broad coalition of groups and activists across the country will call for a realistic raise for the lowest-income earners.

Currently, the federal minimum wage stands at a low $7.25, and North Carolina tracks this federal standard. The minimum wage used to be a much more realistic wage standard – after its creation in 1938, the value rose steadily until reaching a high point in 1968. Since that time, however, the minimum wage’s value has steadily eroded as Congress has failed to correct for inflation over time. If properly adjusted for inflation, the minimum wage would be $10.55 today.

While the minimum wage hasn’t increased in the last three years, the prices of basic goods certainly have. As NELP’s chart below illustrates, the price of tuition, food, gas and utilities have steadily climbed while the value of the minimum wage has not. $7.25 translates to roughly $15,000 per year for a full-time worker while a conservative measure of actual family costs for one adult and one child in North Carolina requires an income of more than twice this amount.

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A new report released by the Food Chain Workers Alliance takes a closer look at the wages and working conditions of the occupations and industries involved in bringing us our food. Core food occupations along the food chain include farmworkers, processing facilities workers, warehouse workers, grocery store workers, and restaurant workers. Together the “food system” employs one in five private-sector workers, yet taken as a whole, provides some of the least sustainable working conditions. Here are some data points from the study:

  • 86.5 percent of the workers surveyed reported earning low or poverty wages,
  • 79 percent lacked access to paid sick days,
  • 83 percent did not have health insurance,
  • 36 percent experienced wage theft in the previous week, and
  • 57.2 percent suffered injury or health problems on the job.

These poor working conditions affect the economic security of workers, but also increase public costs (food system workers use public assistance at higher rates), risk public health (53 percent of workers had worked when sick due to a lack of paid sick days), and keep local economies from thriving.

Mark Bittman wrote an interesting opinion piece about the report in the NY Times yesterday, noting that sustainable food does not always mean sustainable labor practices.

If you care about sustainability — the capacity to endure — it’s time to expand our definition to include workers. You can’t call food sustainable when it’s produced by people whose capacity to endure is challenged by poverty-level wages.

For more information about occupations in the restaurant industry in North Carolina and the history and impact of the sub-minimum wage, take a look at our report: Tipping the Scales toward Fair Wages.

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A recent Yes! Weekly article, Wage Theft: Is the Boss’ Hand in Your Wallet, puts the spotlight on wage theft in the Triad, telling some of the stories of workers experiencing wage and hour violations and the significant impact of wage theft on their lives.

Workers in the area, who didn’t give their names for fear of retaliation from employers, listed a wide range of ways they are denied what they are owed. Restaurant workers were promised raises they never received. A manager on Elm Street was forced to come in and do prep work without clocking in, some workers had to clock out while cleaning the shop….Paychecks bounced, wages were lowered without notification, businesses closed and never gave employees’ their last checks, workers were forced to pay for supplies and campaign workers said they were paid a fraction of what they were promised, if at all.

Wage theft – the illegal underpayment or non-payment of workers’ wages – is on the rise and the scope of violations is substantial.  Claims filed under the FLSA have increased by 400 percent over the last decade. And, as we have written before,  data from the NC Dept. of Labor’s Wage and Hour Bureau, which administers the North Carolina Wage and Hour Act, shows that documented wage theft cost workers and their communities almost $4.7 million in just one year. While these figures are significant, the numbers likely underestimate the occurrence of wage theft. As the Yes! Weekly article reiterates, workers may fear retaliation, hang on to bad jobs because of a lack of other options, or have difficulties seeking redress.

As North Carolina works to sustain this slow economic recovery, it is critical that workers have good jobs and are paid for their work. Wage theft can be devastating for families struggling to make ends meet, but can also impact the broader economy. Businesses that illegally withhold wages are at an unfair competitive advantage and wage theft keeps money and taxes out of local economies.

North Carolinians have long believed that hard work should be rewarded with fair wages. Policy makers must ensure that our existing wage and hour laws are enforced and that unscrupulous businesses are held accountable. By addressing the issue of wage theft, North Carolina can reinforce the value of work, help struggling families, and accelerate the economic recovery.