On July 15, 2008, the House Education and Labor Committee held a hearing titled “Is the Department of Labor Effectively Enforcing Our Wage and Hour Laws?” Most of the testimony heard by the committee concerned the capacity of the Wage and Hour Division (WHD) to enforce the Fair Labor Standards Act (FLSA). Critics contend that the Bush administration has failed to protect workers against a growing problem of “wage theft” by adopting weak approaches to enforcement and reducing funding and staffing levels of the WHD.

In his opening remarks, Chairman George Miller (D-CA) chided employers for paying employees less than minimum wage, refusing to pay overtime when employees worked more than forty hours, and requiring employees to work off the clock. At Chairman Miller’s behest, the Government Accountability Office (GAO) launched two separate investigations into wage theft.

Gregory D. Kutz, Managing Director of Forensic Audits and Special Investigations for the GAO, discussed case studies that revealed examples of WHD not adequately pursuing labor violations. In particular, these studies included instances where WHD inadequately investigated complaints from low-wage workers alleging that employers had failed to pay them the federal minimum wage and required overtime pay, and had withheld their last paychecks. WHD investigators provided the following explanations for their limited responses to some of these complaints: they had to compete against the statute of limitations for assessing back wages because of a backlog of complaints; they did not thoroughly investigate complaints filed anonymously; they did not fully investigate complaints about isolated issues; and they did not treat complaints about receipt of last paychecks as cases to be investigated.

Alexander Passantino, the Acting Administrator for the WHD, outlined WHD’s enforcement responsibilities. He identified a variety of tools that WHD employees use to enforce the law and to achieve compliance, including responding to complaints, initiating directed cases, engaging in educational and other outreach activities, and assessing penalties against violators. Despite achieving improved FLSA compliance in the garment, long-term health care, and poultry processing industries, Passantino noted that WHD’s steadily declining staff level frustrated its performance efforts.

Anne-Marie Lasowski, Acting Director of Education, Workforce and Income Security Issues for the GAO, testified that WHD could improve compliance by making better use of available resources and ensuring consistent reporting. She attributed WHD’s inefficiency to (1) the increased use of more time-consuming comprehensive investigations; (2) a decrease in the number of investigators; and (3) the screening of complaints to eliminate those that may result in violations. The extent to which WHD’s activities have improved FLSA compliance is uncertain because the agency frequently changes how it measures and reports its performance. To assist WHD with better planning and conducting its FLSA compliance activities, GAO recommended that it evaluate complaint data, obtain and use input from external stakeholders, incorporate data from its commissioned studies, and leverage existing tools.

Kim Bobo, Executive Director of Interfaith Worker Justice, also provided recommendations for how WHD could better enforce compliance with FLSA. She suggested that it: (1) develop a community policing model for wage enforcement; (2) devote 50 percent of the Wage and Hour Division’s staff and resources to targeted investigations; (3) punish those who steal wages in meaningful ways; (4) experiment with new educational and enforcement approaches; and (5) increase the number of enforcement staff and attorneys devoted to wage and hour compliance. Additionally, Ms. Bobo recommended that WHD assign at least half the total investigators to targeted investigations focused on low-wage industries known to steal wages from workers.