!!!!Stolen Chances: Low-Wage Work and Wage Theft in Iowa Colin Gordon September 2015

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The Iowa Policy Project 20 E. Market Street, Iowa City, Iowa 52245 (319) 338-0773 www.IowaPolicyProject.org

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Authors and Acknowledgments !Colin Gordon, Ph.D. (History), Professor, Department of History, University of Iowa, is a Senior Research Consultant for the Iowa Policy Project. He has authored or co-authored several IPP reports, including Wage Theft in Iowa (2012) and most reports in the State of Working Iowa series, to advance effective and accountable policies that help working families. He is the author of New Deals: Business, Labor, and Politics in America, 1920-1935; Dead on Arrival: The Politics of Health Care in Twentieth-Century America; and Mapping Decline: St. Louis and the Fate of the American City. We gratefully acknowledge the contributions of the Center for Worker Justice of Eastern Iowa, which conducted the survey for this report, and the University of Iowa Labor Center, which assisted in review of this report. We also thank the Sociological Initiatives Foundation, which provided funding for this report but is not responsible for its content. The views expressed in this report are solely those of the author and the Iowa Policy Project. The Iowa Policy Project !Formed in 2001, the Iowa Policy Project is a nonpartisan, nonprofit organization. Its principal office is at 20 E. Market Street, Iowa City, IA 52245. The Iowa Policy Project promotes public policy that fosters economic opportunity while safeguarding the health and well-being of Iowa’s people and the environment. By providing a foundation of fact-based, objective research and engaging the public in an informed discussion of policy alternatives, the Iowa Policy Project advances accountable, effective and fair government. All reports produced by the Iowa Policy Project are made available to the public, free of charge, via the organization’s website at http://www.iowapolicyproject.org. The Iowa Policy Project is a 501(c)3 organization. Contributions to support our work may be tax-deductible. We may be reached at the address above, by phone at (319) 338-0773, by email at ipp@Lcom.net, or through other contacts available at our website.

The Iowa Policy Project 20 E. Market St. • Iowa City, Iowa 52245 • (319) 338-0773

www.iowapolicyproject.org

September 2015

Stolen Chances: Low-Wage Work and Wage Theft in Iowa !!"#$%&'(#)%*+%(#!

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Wage theft in Iowa: Less invisible, but still an epidemic

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25% of U.S. workers are at low wage; many at or near the $7.25 minimum

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‘Risk shift’: Security of job and decent wages on decline

Source: Economic Policy Institute analysis of Current Population Survey data!2014 dollars, using CPI-U-RS

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What is ‘Wage Theft’? Wage theft occurs whenever a worker is robbed of legally owed wages because an employer breaks the law or a contract. Common forms of wage theft include:

Nonpayment of wages: An employer fails to pay workers for some or all hours of work performed, or fails to pay workers in a timely fashion.

Underpayment of wages: An employer pays workers less than they were promised or less than they are legally owed under state or federal statutes.

Tipped job violations: An employer pays tipped employees less than the legally mandated wage for tipped jobs, or forces tips to be “shared” with managers

Deduction violations: An employer diminishes workers’ pay by making unauthorized or illegal deductions from paychecks

Misclassification: An employer labels an employee as an “independent contractor” in order to avoid obligations to pay minimum wage and overtime (along with a host of other employment laws, and unemployment insurance, workers’ compensation, and income tax payments). !

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Local survey: 25% report some form of wage theft in year

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Research has shown that most workers who experience wage theft do not file claims; in fact, the employment conditions that make wage theft possible make its reporting less likely

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Union decline carries impact on legal protections

Figure 3. Wage Theft Claims Clustered in Leisure and Hospitality, and Construction Iowa Jobs and Wage Claims: Percent Accounted for by Each Sector, 2007-2014

!Y!

!Source: Barry T. Hirsch and David A. Macpherson, unionstats.com.

Q-/5!:*55!*4!%()%(5(6+.+/*6!.61!8*/,(!/6!+-(!2*%>):.,(!-.5!,:(.%!%()(%,$55/*65!4*%!2.3(5!.61!2.3(!5+.61.%15@!A/6,(!+-(!'Xc&5B!.5!2(!-.8(!5((6B!+-(!%(.:!-*$%:F!2.3(5!*4!;*5+!2*%>(%5!-.8(!:.33(1!2(::!9(-/61!+-(!3%*2+-!/6!(,*6*;F=2/1(!)%*1$,+/8/+F@"X!#+-(%!4*%;5!*4!5(,$%/+F!.61!,*;)(65.+/*6!-.8(!4.::(6!.:*635/1(!2.3(5@!Q-(!5-.%(!*4!6(2!2*%>(%5!2-*!,.6!,*$6+!*6!(;):*F(%=)%*8/1(1!-(.:+-!/65$%.6,(!O*4+(6!.!,*::(,+/8(:F!9.%3./6(1!9(6(4/+S!-.5!8/%+$.::F!,*::.)5(1!L!4*%!F*$63!,*::(3(!3%.1$.+(5B!+-(!%.+(!4(::!4%*;!N'!)(%,(6+!+*!U'!)(%,(6+!9(+2((6!'XYX!.61!"&'"d!4*%!-/3-!5,-**:!3%.1$.+(5!/+!4(::!4%*;!"T!)(%,(6+!+*!c!)(%,(6+!*8(%!+-(!5.;(!5).6@U&!!!b.3(!:*55(5!.%(!(5)(,/.::F!.,$+(!/6!5(,+*%5!:/>(!;(.+).,>/63B!2-(%(!/61$5+%F!%(5+%$,+$%/63!/6!+.61(;!2/+-!,*6,(%+(1!(;):*F(%!(44*%+5!+*!2(.>(6!*%!(:/;/6.+(!$6/*65!-.8(!1%/8(6!1%.;.+/,!1(,:/6(5!/6!$6/*6!1(65/+F@!R+!+-(!(61!*4!+-(!'Xc&5B!K$5+!$61(%!-.:4!*4!;(.+).,>/63!2*%>(%5!9(:*63(1!+*!.!$6/*6@U'!Q-/5!4(::!+*!.!+-/%1!9F!+-(!(.%:F!'XY&5B!.61!+*!:(55!+-.6!*6(!/6!4/8(!9F!+-(!(61!*4!+-(!1(,.1(@U"!e(+2((6!'XTc!.61!'XcXB!+-(!.8(%.3(!%(.:!-*$%:F!2.3(!*4!;(.+).,>/63!2*%>(%5!%*5(!Y&!)(%,(6+d!.4+(%!'XcX!/+!4(::!6(.%:F!U&!)(%,(6+@!?6!'Xc&B!).,>/63-*$5(!2.3(5!2(%(!.9*$+!"&!)(%,(6+!-/3-(%!+-.6!+-(!.8(%.3(!;.6$4.,+$%/63!2.3(d!9F!"&&"!+-(F!2(%(!"&!)(%,(6+!:*2(%@UU!Q-(!/;).,+!*4!5$,-!.!:*55!/6!$6/*6!%()%(5(6+.+/*6!/5!/6!+$%6!8/5/9:(!/6!+-(!).++(%6!*4!2.3(!+-(4+!,:./;5!/6!?*2.@!b-/:(!;.6$4.,+$%/63!/5!6*+!-(.8/:F!%()%(5(6+(1!.;*63!2.3(!.61!-*$%!,*;):./6+5!;.1(!+*!(/+-(%!+-(!4(1(%.:!\().%+;(6+!*4!I.9*%!*%!+*!?*2.!b*%>4*%,(!\(8(:*);(6+B!6*61$%.9:(B!4**1B!.61!(5)(,/.::F!).,>/63!2*%>(%5!;.>(!$)!;$,-!*4!+-.+!,*-*%+@!?6!,:./;5!9F!)%*1$,+/*6!2*%>(%5!;.1(!+*!?*2.!b*%>4*%,(!\(8(:*);(6+B!4$::F!.!+-/%1!,*;(!4%*;!;(.+).,>/63!.:*6(@!b-/:(!4**1!)%*1$,+5!.,,*$6+!4*%!:(55!+-.6!Z$.%+(%!*4!;.6$4.,+$%/63!(;):*F;(6+!/6!?*2.B!+-(F!.,,*$6+!4*%!*8(%!T&!)(%,(6+!*4!4(1(%.:!2.3(=.61=-*$%!,.5(5!.61!4$::F!-.:4!*4!4(1(%.::F!.55(55(1!)(6.:+/(5!.61!9.,>!2.3(5!Of/3$%(!WS@!!!

Food industry jobs are a smaller share of manufacturing in Iowa than the industry’s share of wage theft claims by its employees

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!Note: The blue bar shows the food industry’s share of manufacturing employment; the red bars show its share of wage theft claims and penalties by various measures. FLSA: Fair Labor Standards Act; FLSA MW: Fair Labor Standards Act minimum wage.

Source: Department of Labor compliance database !Q-(!3%*2/63!6$;9(%!*4!2*%>(%5!2/+-*$+!.!$6/*6!;/3-+!9(!(E)(,+(1!+*!+$%6!+*!5+.+(!.61!4(1(%.:!.3(6,/(5!4*%!-(:)B!9$+!+-*5(!2-*!1*!;.F!9(!1/5.))*/6+(1!9F!+-(!:.,>!*4!%(5*$%,(5!.8./:.9:(!+*!.55/5+!+-(;@!A+.+(!.61!4(1(%.:!(64*%,(;(6+!.3(6,/(5!:.,>!+-(!%(5*$%,(5!+*!4*::*2!$)!*6!,:./;5B!:(+!.:*6(!:.$6,-!.$1/+5!*%!/68(5+/3.+/*65!*4!*44(61/63!/61$5+%/(5@!e(+2((6!'XcT!.61!"&&TB!/68(5+/3.+/8(!5+.44/63!/6!+-(!\().%+;(6+!*4!I.9*%C5!b.3(!.61!P*$%!\/8/5/*6!4(::!9F!'T!)(%,(6+!(8(6!.5!+-(!6$;9(%!*4!,*8(%(1!2*%>(%5!#0$.%9F!*8(%!W&!)(%,(6+@UT!Q-(!,$%%(6+!)*:/+/,.:!,:/;.+(!-.5!9*+-!5.8.3(1!5+.+(!(64*%,(;(6+!9$13(+5UW!.61!.::*2(1!%(3$:.+*%F!/66*8.+/*65!+*!9(!)*%+%.F(1!.5!.!79$%1(6<!*6!9$5/6(55@UN!^$%%(6+!(,*6*;/,!,*61/+/*65!;.>(!/+!9*+-!;*%(!:/>(:F!+-.+!(;):*F(%5!2/::!%(5*%+!+*!5$,-!8/*:.+/*65B!.61!:(55!:/>(:F!+-.+!2*%>(%5!2/::!9(!/6!.!)*5/+/*6!+*!*9K(,+@!Q-(!/6+(%+2/6(1!1/5.18.6+.3(5!)*5(1!9F!$6/*6!:*55(5B!)%(,.%/*$5!(;):*F;(6+!%(:.+/*65-/)5B!.61!.6!/6.1(Z$.+(!;/6/;$;!2.3(!O/6!8.:$(!.61!,*8(%.3(S!.%(!+-$5!,*;)*$61(1!9F!.!4./:$%(!+*!(64*%,(!(8(6!*$%!;*5+!9.5/,!:.9*%!5+.61.%15@!!!#$%!:*,.:!5$%8(F!/::$5+%.+(5!-*2!(E/5+/63!(64*%,(;(6+!5F5+(;5!+-.+!%(:F!5*:(:F!*6!/61/8/1$.:!2*%>(%5C!>6*2:(13(!*4!:(3.:!%/3-+5!.61!.9/:/+F!+*!6.8/3.+(!,*;):(E!,*;):./6+!)%*,(1$%(5!;.F!)%(8(6+!;.6F!/65+.6,(5!*4!2.3(!+-(4+!4%*;!(8(%!5-*2/63!$)!/6!*44/,/.:!,:./;5!1.+.@!#4!+-(!U&&!%(5)*61(6+5!/6!*$%!5$%8(FB!*8(%!T&!)(%,(6+!O'"YS!(E)(%/(6,(1!5*;(!4*%;!*4!2.3(!+-(4+B!9$+!-+9:%";-<)%"%=<"0)$0%-(%)'-3$!OUUS!)$%5$(1!,:./;5@!#4!+-*5(!2-*!)$%5$(1!,:./;5B!+-)%-+$!-.1!.,,(55!+*!:(3.:!,*$65(:B!$6/*6!%()%(5(6+.+/*6B!*%!*+-(%!.55/5+.6,(!+*!1*!5*@!!!H64*%,(;(6+!%(5*$%,(5!/6!+-(!5+.+(5!.%(!(8(6!;*%(!;(.3(%!+-.6!/6!+-(!4(1(%.:!.3(6,/(5B!.61!?*2.!+%./:5!+-(!).,>@Uc!?*2.!b*%>4*%,(!\(8(:*);(6+!-.5!/6!%(,(6+!F(.%5!(;):*F(1!9$+!*6(!4$::=+/;(!2.3(!,:./;5!/68(5+/3.+*%!L!%(5)*65/9:(!4*%!K$33:/63!$)2.%15!*4!'cW!,.5(5!.+!*6,(@!b.3(!,*;):./6+5!,.6!+.>(!;*6+-5!+*!)%*,(55B!.61!+-(!:(.1(%5-/)!*4!?b\!-.5!,.61/1:F!.,>6*2:(13(1!+-.+!/+!:.,>5!+-(!)(%5*66(:!*%!%(5*$%,(5!+*!1*!/+5!K*9!.1(Z$.+(:F@UY!!!!

Claims filed by only 1 in 4 survey respondents who experienced wage theft

!'&!

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%(2.%1/63!.61!;*%(!5(,$%(@!?6!+-(!5-*%+!%$6B!2(!5-*$:1!1*!6*!:(55!+-.6!(65$%(!+-.+!-.%1!2*%>!/5!%(2.%1(1d!+-.+!2.3(5!.%(!5$44/,/(6+!+*!5(,$%(!4.;/:F!2(::=9(/63B!.61!+-.+!2.3(5!(.%6(1!.%(!.:5*!2.3(5!)./1@!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!1 The survey pool was 65 percent male and 35 percent female. By race, 75 percent identified as African-American and 23 percent as white. By national origin, the survey pool was about one third North American (97), about one-third African (94; 76 from Congo, 6 from Sudan) and about one-third Central or South American (79; 64 from Mexico), with a few respondents from the Middle East (3), the Caribbean (3) and Asia (1). The largest reported first language was English (at 38 percent) followed by Spanish (29 percent) and French (27 percent)—the latter reflected the large Congolese cohort. 2 For an overview of the mismatch between patterns of work, and the policies that shape the labor market, see Eva Bertram, “Doors, Floors, Ladders, and Nets: Social Provision in the New American Labor Market,” Politics and Society 41:1 (2013), 29-72. 3 Lawrence Mishel, “The United States Leads in Low-Wage work and the Lowest Wages for Low-Wage Workers,” (Economic Policy Institute, September 2014) http://www.epi.org/blog/united-states-leads-wage-work-lowest-wages; Elise Gould, “Why America’s Workers Need faster Wage Growth-And What We Can Do About It” (EPI, August 2014) http://www.epi.org/publication/why-americas-workers-need-faster-wage-growth/ 4 The basic-needs budgets constructed for this report represent a very frugal living standard; using costs as of 2013 (with the exception of health insurance), the budgets are based on what is needed to “survive” rather than “thrive.” This includes allowances for rent, utilities, food prepared at home, child care, health care, transportation, clothing and other household necessities. The basic budget does not include savings, loan payments, education expenses, any entertainment or vacation, or meals outside the home. http://www.iowapolicyproject.org/2014Research/140226-COL.html 5 http://www.iowapolicyproject.org/2014docs/140226-COL-Appendix3.pdf 6 U.S. Department of Labor, http://www.dol.gov/whd/minwage/america.htm 7 Iowa Policy Project, The Cost of Living in Iowa 2014, http://www.iowapolicyproject.org/2014Research/140810-CostOfLiving.html; assumes no work supports such as child care, housing, food or energy assistance. 8 See http://www.epi.org/publication/lagging-minimum-wage-reason-americans-wages/ Johns Schmitt, http://www.democracyjournal.org/29/minimum-wage-catching-up-to-productivity.php http://www.dissentmagazine.org/online_articles/whats-so-bold-about-9-00-an-hour-benchmarking-the-minimum-wage 9 Author's calculations from top incomes database 10 http://www.epi.org/publication/causes-of-wage-stagnation/ http://www.epi.org/publication/charting-wage-stagnation/ 11 Schmitt, Why Does the Minimum Wage Have No Discernible Effect on Employment? (CEPR, 2013) 12 Elise Gould, 2014 Continues a 35-Year Trend of Broad-Based Wage Stagnation (EP!, 2015); Arin Dube, The Minimum We Can Do, New York Times (November 30, 2013). 13 See http://www.demos.org/publication/scheduling-hourly-workers-how-last-minute-just-time-scheduling-practices-are-bad-workers 14 The Bureau of labor Statistics has not conducted its contingent work survey since 2005 (see http://www.bls.gov/news.release/conemp.nr0.htm). The 25-30 percent estimate comes from surveys by management consulting firms, including Accenture (http://www.accenture.com/SiteCollectionDocuments/PDF/Accenture-2013-Skills-And-Employment-Trends-Survey-Perspectives-On-Training.pdf) and Deloitte (http://www2.deloitte.com/content/dam/Deloitte/global/Documents/HumanCapital/dttl-hc-chapter18-8092013.pdf) 15 A good summary account is Arne Kalleberg, “The Social Contract in an Era of Precarious Work,” Pathways (Fall 2012), 3-4. 16 On day labor, see U.S. General Accounting Office, Worker Protection: Labor’s Efforts to Enforce Protections for Day Laborers Could Benefit from Better Data and Guidance, GAO-02-925 (2002); Immigrant Rights/International Human Rights Clinic, Seton Hall Law School, All Work and No Pay: Day Laborers, Wage Theft, and Workplace Justice in New Jersey (January 2011), 2; Abel Valenzeula Jr., Nik Theodore, Edwin Meléndez & Ana Luz Gonzàlez, On the Corner: Day Labor in the United States, UCLA Center for the Study of Urban Poverty, University of Illinois at Chicago Center for Urban Economic Development & New School University (January 2006); Daniel Kerr & Chris Dole, Challenging Exploitation and Abuse: A Study of the Day Labor Industry in Cleveland (2001); Dep’t of Systems Management for Human Services, An Account of Day Laborers in Fairfax County (June 2004); Abel Valenzuela Jr. & Edwin Meléndez, Day Labor in New York: Findings from the NYDL Survey, UCLA Center for the Study of Urban Poverty & New School University Community Development Research Center New School University (2003). 17 See Lalith De Silva, et al., Independent Contractors: Prevalence and Implications for Unemployment Insurance Programs, Planmatics, Inc., Prepared for the US Department of Labor Employment and Training Administration (2000); U.S. General Accounting Office, Employee Misclassification: Improved Coordination, Outreach, and Targeting Could Better Ensure Detection and Prevention (August 2009); Workers Defense Project, Building Austin, Building Injustice: Working Conditions in Austin’s Construction Industry (2007). 18 Iowa Misclassification Task Force, 2nd Report (December 30, 2010); David DeWitte, “Task force tally: 2,602 workers misclassified as contractors,” The Cedar Rapids Gazette (January 10, 2011). More generally, see Sarah Leberstein, Independent Contractor Misclassification Imposes Huge Costs on Workers and Federal and State Treasuries (NELP, June 2010) 19 See Arne Kalleberg, Good Jobs, Bad Jobs: The Rise of Polarized and Precarious Employment Systems in the United States, 1970s-2000s (2011); Jacob Hacker, The Great Risk Shift: The New Economic Insecurity and the Decline of the American Dream (2008).

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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!20 See Rebecca Smith, et al., Winning Wage Justice: A Summary of Research on Wage and Hour Violations in the United States (National Employment Law Project, January 2012) for an excellent summary of recent research. 21 Annette Bernhardt et al, Broken Laws, Unprotected Workers: Violations of Employment and Labor Law in America’s Cities (National Employment Law Project, 2009), Table 3.1, p20; 27. See also Siobhàn McGrath, A Survey of Literature Estimating the Prevalence of Employment and Labor Law Violations in the U.S. (New York: Brennan Center for Justice, 2005) and Ruth Milkman et al, Wage Theft and Workplace Violations in Los Angeles: The Failure of Employment and labor Law for Low-Wage Workers (Institute for Research on Labor and Employment, UCLA, 2010), Table 2, p18. 22 Department of Labor, The Social and Economic Effects of Wage Violations: Estimates for California and New York (December 2014) 23 Zach Schiller and Sarah DeCarlo, Investigating Wage Theft: A Survey of the States (Policy Matters Ohio, November 2010; Tim Judson and Cristina Francisco-McGuire, Where Theft is Legal: Mapping Wage Theft Laws in the 50 States, (Progressive State Network, June 2012); National State Attorney General’s Program, Enforcement of State Wage and Hour Laws: A Survey of State Regulators (Columbia Law School, April 2011); David Weil, Improving Workplace Conditions Through Strategic Enforcement (Report to the Wage and Hour Division, May 2010)., 24 Iowa Code Section 91A.6(3). 25 Iowa Code Section 91A.3(3). 26 David Weil and Amanda Pyles, Why Complain? Complaints, Compliance, and the Problem of Enforcement in the U.S. Workplace, Comparative Labor Law and Policy Journal (2006), p78. 27 Ann Haley-Lock, “The Structural Contexts of Low-Wage Work: Restaurant Employment Practices Across Firm Geography, Size, and Ownership Status,” Journal of Poverty 16:4 (2012), 447–468. 28 Walmart employees in Clinton, Iowa, filed a class-action suit alleging the company had regularly required employees to work overtime without pay. Walmart settled the suit in 2008 (along with 62 other wage and hour class-action suits it was facing across the nation), agreeing to pay $11 million distributed among 97,259 people who had worked at Walmart stores in Iowa between June 1999 and May 2009. See Steven Martens, Wal-Mart Wage Suit Settled for $11M, Quad City Times (Oct. 14, 2009). Tipped workers at Applebees filed a complaint after being forced to pool tips with management. See “Senate Democrats Offer Plan to Stop Wage Theft,” Des Moines Register (January 27, 2015). 29 http://www.epi.org/publication/causes-of-wage-stagnation/ http://www.epi.org/publication/charting-wage-stagnation/ 30 http://www.epi.org/publication/class-of-2014/ 31 http://www.ers.usda.gov/publications/aer-agricultural-economic-report/aer785.aspx#.UWrNnqLviSo 32 http://www.jstor.org/stable/40342745?seq=1#page_scan_tab_contents 33 http://www.hrw.org/en/reports/2005/01/24/blood-sweat-and-fear 34 Bernhardt and McGrath, Trends in Wage and Hour Enforcement. 35 National State Attorney General’s Program, Enforcement of State Wage and Hour Laws: A Survey of State Regulators (Columbia Law School, April 2011), Table 1, 44ff. 36 In March 2011, a bill that would have required employers to keep signed documentation to show wages and deductions pass the Iowa Senate but died in the House. The chair of the House committee claimed the bill “would create additional regulatory burdens upon good-acting businesses.” Jason Clayworth, “Iowa’s anti wage-theft bill hits a snag,” Des Moines Register (March 23, 2011). 37 Schiller and DeCarlo, Investigating Wage Theft, 5-7. 38 See Jens Manuel Krogstad, “Growing number of Latino workers report they aren't paid wages,” Des Moines Register (March 19, 2011), A1; Adam Belz, “Wage Thefts protested at Forum,” Des Moines Register (October 24, 2010), B1; Iowa Misclassification Task Force, Report to Governor Culver, 7 39 Annette Bernhardt, “The Role of Labor Market Regulation in Rebuilding Economic Opportunity in the U.S.” Work and Occupations 39:4 (2014), 354-375. 40 National Employment Law Project, “City Minimum Wage Laws: Recent Trends and Economic Evidence,” May, 2015. 41 “US lags behind world in temp worker protections”, ProPublica, February 24, 2014, http://www.propublica.org/article/us-lags-behind-world-in-temp-worker-protections 42 ABA International Labor & Employment Law Committee, February 2012 http://www.americanbar.org/newsletter/groups/labor_law/int_newsletter/ilel_news20121/february2012/1202_aball_int_global.html 43 https://www.illinois.gov/idol/Laws-Rules/FLS/Pages/changes-to-dtlsa.aspx 44 Clark Kaufman, “Disabled workers paid cents per hour at state-run homes,” Des Moines Register (December 28, 2009), B1. Though civil and criminal penalties for wage theft are available under both state and federal laws, they are rarely imposed. The FLSA permits the DOL to request civil penalties of up to $1,100 for each violation and/or criminal sanctions of up to two years in prison for willful violations of the FLSA. IWD can request penalties of up to $500/pay period for violations of either Chapter 91D (minimum wage) or Chapter 91A (wage payment). It is extremely unusual for either agency to pursue penalties, though that trend may be changing, at least at the US DOL. 45 Under the simplified criteria used in what is known as the “ABC test,” service performed by an individual shall be deemed to be employment unless and until it is shown that: A) Such individual has been and will continue to be free from control or direction over the performance of such services, both under his contract of service and in fact; and B) Such service is either outside the usual course of the business for which such service is performed or that such service is performed outside of all the places of business of the enterprise for

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!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!which such service is performed; and C) Such individual is customarily engaged in an independently established trade, occupation, profession or business.” Judson and Francisco-McGuire, Where Theft is Legal, p 19. 46 See Senate File 270, 2015 Iowa Legislature. 47 http://www.desmoinesregister.com/story/news/politics/2015/01/27/iowa-wage-theft-senate/22430863/