One major roadblock to creating a sustainable workforce in the Texas construction industry is rampant wage theft by unethical businesses in our state. Many of them are the very same companies that routinely misclassify their workers.
As Construction Citizen has reported over the years, the refusal to pay people who do some of the hardest labor is not only commonplace, but in some cases has included alleged threats of violence. In one situation in Houston, for example, an employer was accused of threatening a worker at gunpoint when he simply asked to receive his paycheck. No one should have to go through that as they work honestly to support their family. Wage theft happens to workers who are both undocumented and documented, it should be noted.
To the Houston City Council’s credit, they passed an anti-wage theft ordinance that establishes a process through the City’s Office of the Inspector General so that employees can bring wage theft claims forward. “In the Houston area alone, it is estimated that over $750 million dollars are lost due to wage theft among low-wage workers every year,” said Laura Perez-Boston, the Director of the Fe y Justicia Worker Center and a Construction Citizen blogger. Keep in mind that number is for all industries, not just construction.
At the Texas Capitol in Austin for the past couple of years, Rep. Mary González, D-El Paso, has been working to crack down on wage theft by proposing to make it much harder for employers with a history of it to continue to be awarded contracts. A bill she’s filed this session – similar to one she filed in the last legislative session two years ago – would create a “database of employers penalized for failure to pay wages or convicted of certain offenses involving wage theft.” The idea, González said, is focused on creating an environment in which the right behavior is rewarded while discouraging bad actors.
“To fix a problem as big as wage theft we need to have multiple solutions to have the effect that we want to see," González told Construction Citizen. She said it’s the right thing to do “not only for the workers of Texas but for the honest businesses that have trouble competing when these people are cheating.” That’s why the sophomore House Democrat is coordinating her efforts with the business community and Republican officeholders to try to make the proposal a reality this year. "I want to work with everyone to find a solution,” she said.
To that end, González has teamed up with Rep. Jeff Leach, R-Plano, who is a construction attorney by trade. He said when it comes to wage theft it does not matter that he and González are from different political parties or that they represent communities nearly 700 miles apart. “This is a common sense, good public policy issue,” Leach said. “Everyone recognizes it’s a problem,” he said. “The question is how do we solve it?”
González and Leach both stressed that they are working with various stakeholders to ensure the bill will address the issue without making it harder for ethical businesses to operate. “What we want to do is hold people responsible for wage theft but we don’t want is to affect the industry negatively,” Leach said. “We’ve been getting positive feedback from the industry.”
A 2013 study by the Workers Defense Project and the University of Texas found that nearly 8% of construction workers said they had been the victims of wage theft in the previous year. That amounted to more than $117 million in lost wages for that year in commercial construction. That also translated to the state losing out on about $8.6 million in sales taxes from those commercial construction workers. That does not account for wage theft in construction of homes.
Construction Citizen will track Rep. González’s bill as it makes its way through the legislative process.