Denver wage theft ordinance gives city auditor power for civil penalties

The Denver City Council on Monday adopted an ordinance that gives greater power to the city auditor’s office to investigate and penalize employers that don’t pay workers the wages they owe them.

The newly adopted policy now on Denver’s books gives the auditor the power to force employers found to be committing wage theft in Denver to pay workers the money they are owed plus 12% interest. The auditor can also impose penalties including job reinstatement, fines of up to $25,000 or even “treble damages” equal to three times the amount of unpaid wages and overtime owed.

So-called “upstream” employers, those who hire subcontractors that may go bankrupt, can also be held liable under the new law, a key wrinkle in industries like construction where larger companies sometimes contract out work to less reputable firms.

“Our North Star has always been that if you work in the city of Denver you get paid for the work that you’ve done,” Councilwoman Amanda Sawyer said Monday night.

Sawyer cosponsored the bill alongside fellow councilmembers Candi CdeBaca, Stacie Gilmore and Council President Jamie Torres.  Its passage brings to a close a nearly four-year effort to get tougher on wage theft in a city that has grown rapidly over the last decade, sometimes at the expense of the workers building it.

City research found that $728 million in legally earned wages were stolen from Colorado workers by their employers last year. As of 2009, an estimated one in 10 workers was affected by wage theft, according a presentation delivered to the council’s finance and government committee last month.

Workers, including dozens of orange-clad members of the Southwest Regional Council of Carpenters, applauded when the final 12-0 was cast.

A handful of workers shared their stories of being hurt by wage theft including Marilyn Rowe, a home health care worker who said a company failed to pay her hundreds of dollars worth of wages she was owned for taking care of patients. She said that a federal judgment in her favor still has not resulted in her receiving payment.

“I have been trying for years to get my money back and I’m still waiting,” Rowe said Monday.

Denver’s new law would run parallel to existing state and federal laws that set out criminal penalties for wage theft, the idea being that the auditor’s office can move more quickly to bring employers into compliance and get workers paid.

The Denver Metro Chamber of Commerce opposed the bill in part because it layers regulations on top of existing regulations, Jess Kostelnik, the chamber’s senior government affairs manager, said.

But that argument didn’t sway the council.

Councilman Kevin Flynn mentioned that there is one easy way around the new law and its potentially significant penalties and that is “to pay your works every damn cent they earn.”

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