Texas Republicans Miss Opportunity to Lead on Capitalism and Lawful Commerce - Legislature Passes Wage Theft Bill

There were many successes in this legislative session, but one of these successes illustrates an area where, as Republicans, we failed to provide crucial leadership in the protection of employee rights and fair business practices. As we are supposed to be the champions of capitalism and lawful commerce we failed to step forward on the issue of reigning in unscrupulous businesses who abuse workers through wage theft and employee misclassification and cheat us all in the process.

Yes, we have to give credit where credit is due, Texas Democrats authored and passed a Wage Theft bill that will enhance law enforcement's ability to crack down on employers who cheat their workers out of hard earned wages. This according to a new report on ConstructionCitizen.com. Of course the bill would not have passed without Republican support, but why does it seem that bills that protect workers' rights seem to come from the left. Isn't the Republican Party supposed to be the "law and order" party? Shouldn't we be leading the way to fair competition in business practices?

Construction Citizen reports:

On May 27th, Governor Rick Perry signed into law a groundbreaking measure that will expand the ability of local law enforcement agencies to arrest employers who cheat their workers out of their pay. Texas SB 1024, the “Wage Theft Bill”, which was sponsored by Senator José Rodriguez (D-El Paso) and Representative Eddie Rodriguez (D- Austin), creates a powerful mechanism for workers to recover their unpaid wages.

Wage theft is a widespread problem that occurs when employers fail to pay their employees for their work. In certain industries like construction, wage theft occurs in epidemic proportions. According to the University of Texas study Building Austin, Building Injustice: Working Conditions in the Texas Construction Industry, one in every five Austin construction workers has been denied payment for their work. Wage theft also undercuts responsible businesses who can’t compete, and hurts working families by forcing them to face unexpected hardships.

The Wage Theft Bill makes it easier for police departments across Texas arrest employers who don’t pay their workers, and closes an important loophole that up to now has allowed employers to avoid criminal theft of services charges by making a minimal payment to their workers.

Wage Theft and Employee Misclassification affects all of us. When some businesses cheat employees out of wages it gives them an unfair competitive advantage over businesses that operate properly. When people who should be classified as employees are fraudulently paid as "independent contractors" when they don't meet the requirements of that classification they are denied benefits and it results in increased healthcare costs for us all. When proper taxes are not paid by these companies and their "independent contractors" we end up paying more to make up for their short payments. And when a lawless underground of cash payments are established, our welfare costs rise because deadbeat parents are able to skate under the radar of child support enforcement. Not to mention the big draw to the illegal immigration problem of companies improperly working and abusing illegal aliens. And we saw we want to stop illegal immigration?

State Representative Joe Deshotel (D-Port Arthur) earlier this year, introduced HB 2989, the Workplace Fraud Prevention Act. This bill easily passed out of Business and Industry committee with bi-partisan support from legislators, business people and faith leaders. But "somehow" it died in the Calendars Committee. Who supported and who opposed this bill? Perhaps looking into this question will answer the "somehow" question...

The bill was supported by the Texas Construction Association, the Texas Association of Builders and the Texas Chapters of the National Electrical Contractors Associations. Many individual business owners also came and testified in support of the bill.

However, it was opposed by the all-powerful Texas Association of Business, the National Federation of Independent Business, and the Independent Electrical Contractors. Why do these groups seek to stand in the way of fair business practeices?

In a written statement, Matt Capece of the United Brotherhood of Carpenters and Joiners of America, offered the following comment, "This legislation represented one of those moments that citizens want from their legislators. Business, Labor, Republicans and Democrats were united behind a measure to uphold the law, protect hard working Texans and construction businesses. I fail to understand why others believe that taxpaying businesses have to take a back seat to others that break the law. It's a shame that it was denied an up or down vote on the House floor by an anonymous member of the Calendars Committee, even though it passed the Business & Industry Committee unanimously."

The author of the "Wage Theft Bill", Sen. Rodriguez stated: “The Wage Theft Bill is an important victory for Texas workers, especially in this legislative session where workers’ rights have been under attack. This new law will ensure that thousands of hardworking Texans receive their fair pay.” But beyond that, the new law will set the tone that Texas will not tolerate companies cheating workers to gain an unfair competitive advantage over someone who is managing their business legally and ethically.

So, while I applaud the Legislature for moving forward in the area of wage theft, it is sad to see that we passed up an excellent opportunity to show leadership on an issue which dips into all our pocketbooks and effects the moral compass of our state's business community. Wage theft and employee misclassification are just wrong. We should all stand behind fixing these problems. And, if we, as Republicans, are supposed to be the champions of capitalism and the "rule of law" we should be leading on these issues and not following or even standing in the way. What do you think?

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