Overtime, Wages and Theft

civil rights, crapitalism, economics, ethics, law Leave a reply

I know a number of people here in Vancouver working in restaurants and bars, and the prevalence of unlawful behaviour is just astounding. Of course, I don’t mean the staff stealing from employers, but employers just stealing wholesale from the staff.

While BC has some fairly mediocre labour laws, it has labour laws that employers are obligated to abide by. Unfortunately, as the laws are civil in nature (rather than criminal), the enforcement of these laws falls on the shoulders of the employees: if the staff don’t report the breach to the Employment Standards Branch, then the company happily trundles on, stealing from the employees.

This isn’t theft, you say? Since the staff have implicitly agreed to this state of affairs, it’s no-one else’s business to intervene? I’m sure that it’s possible that you could be more wrong about this, but it’s not obvious how. Allow me to explain.

Let’s assume that we’re talking about a moderate-size establishment, with 10 employees. For ease of calculation, we’ll just go with the lower minimum wage here in BC of $9 per hour (yes, I know: two minimum wages? Ridiculous). Let’s assume that the staff works 10 hours straight, with a paid meal break that they are required to work through (which, appallingly, is entirely legal). They get tips, and the employer has agreed with the staff (and we’ll come back to this later) that since they get tips, they’re not going to pay overtime.

Those last two hours of the day should, by law, be paid at time-and-a-half pay: $9 x 1.5 = $13.50. So the staff are being left short $4.50 per hour, for a total of $9 per day. Big deal, sez you, it’s only $9. Per member of staff, per day.

Now, while it’s true that I can’t do a hell of a lot with $9, if I’m working 4 shifts a week, I’m being shorted $36 per week, or $1,800 per year (assuming a 50 week work-year). Granted, you won’t see all of it as you’ll have to pay roughly 20% of it in income tax, but you’re still out over $1,400. That’s not an insignificant amount of money, and it’s per year.

Notice also that this is per member of staff. That $1,800 generates roughly $360 in taxes that are not being paid to the government, times 10 employees that’s $3,600. Across an industry? That’s a significant amount of money that is being denied to government spending. Now while we all might question what the current BC (and Canadian) government(s) are doing with our tax dollars, that doesn’t mean that none of the tax dollars are being well-spent. Roads are useful, as is water, healthcare, and schools. All of these would benefit from that money.

The staff are out $1,400 each. The government is out $360 per employee. Meanwhile, our hypothetical business (10 employees to steal from) is up $18,000 per year. While I’m sure that some of that would go to the government coffers, thus off-setting the loss above, employee deductions are allocated to specific funds (such as Employment Insurance) which business taxes don’t contribute to independently (for specific employees).

What do we call it when I go into a Barber’s shop, get a haircut, and then pay only 90% of the price sticker ‘just because’? The above is as much theft as is me availing myself of somebody’s services and just not paying them the legally required amount.

Some employers want to get around this by requiring their staff to sign contracts to the effect that the staff are signing their rights away. At best, these employers are greedy and ignorant: you can’t sign away statutory rights. There’s an asymmetry of power in any potential employee/employer relationship, such that the conditions of the employee may amount to coercive circumstances that an employer may exploit. When I first sought a job here in Vancouver, an owner of a Subway franchise offered to hire me if and only if I agreed that if I quit the job before the 4-day training period was complete, he wouldn’t pay me. I agreed to this, figuring that I was *probably* going to finish out the training period (I had applied for a number of other jobs), but figured that even if I didn’t, the conditions that he was placing on me were illegal.

Why not just refuse? Because I was out of food. Once I had a job (i.e. money) lined up, I knew I could borrow a few dollars from a friend to cover me, but without that job, there’s no way I was going to go borrowing money. After two days, I got a call for a marginally better job (i.e. not working with food), and I quit Subway. True to his word, the owner told me he wasn’t going to pay me. One phone call to the Employment Standards Branch later, and he had a cheque for me. Contracts that violate your rights aren’t valid, and can’t be enforced. It doesn’t matter a damn if an employee agrees to illegal terms, those terms are unenforceable because they are illegal. Given the asymmetry of power in the employer/employee relationship, the onus is on business owners to employ people legally. Non-citizens are even more at risk of exploitation, as they are often (unnecessarily) worried about their visas and legal status.

What about businesses that simply can’t afford to pay overtime to their staff? Well… “Being incompetent” certainly doesn’t override “being a thief”, so there doesn’t seem to be any confusion there for me. If you can’t operate a business without breaking the law, perhaps that’s a clue that you shouldn’t be operating a business in the first place.

If anyone reading this knows folk in BC working overtime without being paid, please direct them to the web page for the Employment Standards Branch, and encourage them to give the ESB a call (1 800 663-3316). On the bottom right of the page, many of the documents are available in 9 languages (plus English), and I’ve found the staff who deal with phone calls to be exceedingly helpful and understanding.

If someone picked up your wallet and walked away, you’d report the theft, right?

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