Washington State

Office of the Attorney General

Attorney General

Bob Ferguson

FOR IMMEDIATE RELEASE: 
Jan 11 2015

Proposes legislation to prohibit wage theft violators from doing business with the state

OLYMPIA — Washington State Attorney General Bob Ferguson has proposed bipartisan legislation that would prohibit businesses that have repeatedly or willfully violated the state’s wage payment laws during the past three years from doing business with Washington state.

“Wage theft hurts workers and honest businesses that want to compete for government contracts,” said Ferguson. “Government contracts and taxpayer dollars should go to companies that follow the law. Washington won’t do business with those that unlawfully withhold wages from employees.”

The Attorney General request legislation Senate Bill 5050 is sponsored by Pam Roach, R—Auburn. The companion bill, House Bill 1089, is sponsored by Sam Hunt, D—Olympia.

“Government should favor businesses that operate within the law,” said Roach. 

“I am proud to sponsor legislation that honors businesses who operate with honesty and fairness,” said Hunt. “Wage theft hurts workers and their families. Every employee should be compensated fairly for his or her work. This new law will make clear that Washington will not reward companies that continually subvert the law and put profits over people.”

Wage theft occurs when an employer illegally withholds pay that is rightfully owed to an employee. Washington’s Minimum Wage Act, Wage Payment Act and related laws require employers to pay their workers earned wages or face penalties for noncompliance.

Currently, companies that do business with the state are not required to demonstrate adherence to the state’s wage payment laws.

The proposed legislation amends the state’s ‘responsible bidder’ criteria in the public works and procurement statutes to require consideration of a company’s compliance with the state’s wage laws during the last three years. These criteria are used to determine if a bidder is qualified to be awarded a public contract.

Since 2007, Department of Labor & Industries (L&I) identified 771 Washington state businesses as repeat wage law violators. In an independent review, staff from the office of the Attorney General identified 22 of those businesses as registered with the state’s electronic vendor registration system demonstrating an interest or intent to compete for state contracts.

In 2009, a report from the National Employment Law Project found that across the country almost half of low-wage workers suffered at least one pay-related violation in the previous year. In Washington state, according to L&I, approximately 3,000 workers are currently owed an aggregate of about $1 million by 1,600 employers.

The state spends more than $1 billion annually to buy a variety of goods and services, but spends billions more on public works projects contracts.

Background

Across the country, jurisdictions are adopting rules to prevent wage violators from benefiting from taxpayer-funded contracts. Under the recent Fair Pay and Safe Workplaces Executive Order, beginning in 2016 the federal government will require certain contractors to affirm compliance with wage laws. In a similar effort, the city of Boston will require vendors to certify their compliance with wage laws. Minnesota has also passed legislation to include adherence to wage payment laws as part of the responsible contractor criteria.

While serving on the King County Council, Ferguson sponsored a similar wage theft measure that was adopted.

 

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The Office of the Attorney General is the chief legal office for the state of Washington with attorneys and staff in 27 divisions across the state providing legal services to roughly 200 state agencies, boards and commissions. Attorney General Bob Ferguson is working hard to protect consumers and seniors against fraud, keep our communities safe, protect our environment and stand up for our veterans. Visit www.atg.wa.gov to learn more.

Contact: Alison Dempsey-Hall, Deputy Communications Director