nettime's_roving_journalist on Mon, 25 Jan 1999 02:21:22 +0100 (CET)

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<nettime> Work for Free

    [Nice meme: "Each year $19+ billion is lost to employer theft..."]


January 24, 1999

Tampering With the Time Clock


CHICAGO--It's no secret that Americans work harder than the
citizens of almost every other industrialized nation: longer
hours, less vacation, more stress on the job. At least we're
getting paid more money for all this extra work, we tell

<not. people do a lot of work for free>

By that I mean...well, free. Off the books. As in, "This
hour doesn't count, so I don't have to pay you." 

<restaurant workers not paid for 1 hour of closing up;
<laundry workers' sick leave deducted from vacation time;
"part-time" college grads paid for 25 hours, work for 40;
blue-collars laughing at low-paid white-collars>

The payoff for employers is even bigger when overtime wages
are at stake. The Fair Labor Standards Act, or F.L.S.A.,
requires that workers be paid time-and-a-half for every hour
over 40 that they work in a week. That rule doesn't apply,
though, to anyone in a professional or managerial job. 

This explains why you see so many signs these days saying,
"Assistant manager wanted." Those assistant managers often
end up operating the same machines or loading the same
trucks as the workers they're "managing." 

And in the case of hourly workers who clearly are covered by
the labor standards act, plenty of employers simply flout
the law. Recent surveys by the Labor Department have found
huge numbers of businesses--60 percent in some
industries--violating one or another provision of the act. 

<lots of other examples>

Otherwise, it's hard to get a number on how much stealing is
going on. By definition, it's off the books, so economists
ignore it when they look at wages. 

"Consider this," says a friend of mine, a labor lawyer who
specializes in F.L.S.A. cases. 

"We're now a service-sector economy, so almost all the costs
are labor costs.  It's 90 percent for some businesses. So
you don't even have to steal much of your workers'
time--maybe 2 or 3 percent--to make a profit." 

<service sector theft increases, profits rise, the Dow Jones
goes up...>

Even business groups admit this. The Employer Policy
Foundation did a study in 1996 estimating, "conservatively,"
that illegally denied overtime pay amounted to at least $19
billion each year. 

As a union lawyer, I believe that's a vast underestimate.
And it covers only one type of violation. There are many

<supermarkets, non-union hotels, clubs, nursing homes...>

In many hotels now, employees work through "break time," but
the break time gets deducted from their paychecks anyway.
The ruse is, the hotel gives it back if the workers complain
individually--but how many dare to do this? Some hotels and
clubs even collect tips that their employees never see. 

So how come all this labor theft goes on? Because there's no
one to stop it. 

The unions can't do much--they now cover 10 percent or less
of the private sector. 

The Labor Department has been weakened by repeated cutbacks
over the past 20 years. So no one is keeping an eye on who's
being exempted from the labor standards act. 

Even when labor lawyers find out about violations and decide
to file suit, they face another obstacle: in F.L.S.A. cases,
it's impossible for them to bring the normal type of class
action. The plaintiffs all have to opt in one by one. In
places like Chicago, where more than half the factory
workers are foreign-born -- Russian, Latino, Polish,
Filipino--that's no easy matter. 

<this is happening at the top *and* the bottom of the work

For example, many recent law school graduates now work as
"independent contractors" for big firms. It's essentially
piecework: they get a contract for a certain project and a
certain fee, and then more and more work gets assigned to
them. As with the part-time supervisors, 25 hours a week
turn into 40. 

Of course, you may be thinking, people at the top speak up
about it, the way a laundry worker would not. But is that
true? In a nonunion culture, the college graduates are also
abused. Growing up, they don't grasp that there's any
alternative to being ripped off (except, of course, to start
a business on the Internet). 

How do I explain to a kid who's been "upgraded" to
"assistant manager" because of his or her "skills"--they're
making you work for nothing? There's nothing in our culture
any more to inoculate people against this. 

With all this free work gushing into the economy every year,
it's no wonder wages are rising, without inflation. Why
should there be inflation at a higher wage if people at the
higher wages are doing more work for less money? 

To Alan Greenspan, it's a puzzle why there's no inflation.
Two years ago, he decided there as an "invisible"
productivity that no one can see or touch. 

There's no number, it's not countable, but it's out there.
The sagest people nodded. Yes, that's why there's no
inflation. People are more productive for each hour worked,
they have higher skills: "Look at all the assistant managers
in those fast-food places." 

But maybe there's a simpler explanation than Chairman
Greenspan's invisible productivity. Out of sight, at every
income level, more of us are working "for free."

Thomas Geoghegan, a labor lawyer, is the author of "The
Secret Lives of Citizens," to be published next month.
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