Temporary Worker’s Exploitation Documented

“The true cost of labor can only be ascertained by ascertaining the cost of all the means necessary to the comfortable feeding, clothing and housing of the laborer and his family with the addition of schooling for his children.  If the price paid for labor will not secure this to the laborer, than whoever gets that labor for such price is getting it at less than cost.”

--H.J. Walls, Commissioner of Ohio Bureau of Labor Statistics, 1878

by Dan Kerr

            Outside of his presumption that the laborer was a male, Walls’ quite nearly 125 years ago is just as appropriate today as it was then.  The plight of day laborers in Cleveland, which is documented in the report, “Challenging Exploitation and Abuse:  A study of the Day Labor Industry in Cleveland,” makes it clear that the day labor agencies in this city are not paying the true cost of labor.  As a result, they are producing unnecessary hardships for their employees and creating extensive costs for the larger community.  The agencies would not be able to reproduce their workforce if it was not for the extensive and largely publicly subsidized infrastructure in place that provides for the unmet needs of their workers: the shelters, meal sites, drop-in centers and health care services available to the working poor in the city of Cleveland.  From the day labor agencies’ perspective, these locations are warehouses of workers that supply a ready pool of desperate and dependent warm bodies.

            The impetus for the report emerged from the interviews that I conducted with the Cleveland Homeless Oral History Project.  To my surprise, I soon discovered that the large majority of men and women who live in the shelters in the City of Cleveland work.  Their principal employment is through temporary day labor agencies.  The project also identified that one of the primary causes of homelessness, identified by the homeless themselves, is the temporary day labor industry.  The on-month study that the current report is based on, has sought to identify the concerns and realities of workers within this industry.  Many of the findings in this study are supported by the recent coverage done by the Plain Dealer and the Free Times on the abuses and exploitation in the local day labor industry. 

            The interviews and focus groups conducted with close to a hundred day labors in the City of Cleveland, homeless and non-homeless alike has revealed several key grievances.  The most important of these grievances is that workers are not paid fairly for the labor that they do.  As a result, they are not unable to afford or maintain housing, nor are they able to break out of a cycle of poverty from the wages they receive.  Furthermore, workers find themselves trapped in the day labor cycle with the promise of permanent employment never fulfilled.  Workers find themselves in the industry for years without anything to show for it. Pensions and health benefits are out of the question.

            The industry is characterized by long days and low wages.  Typically workers wake up at 4:00 am, go to the agency office and start waiting to be sent out at 5:00 am.  They may not be sent out until 8:00am and will often travel to the outer ring suburbs to work in machine shops and plastics manufactures.  They may start working around 9:00 am and finish at 5:00 p., wait for a ride to pick them up (if it ever does) and not return home until 7:00 pm.  After fees for rides, safety equipment and check cashing, the worker will in most cases have between $28 and $30 in their pocket for approximately fourteen hours of working, traveling and waiting.

            Other problems that workers face is that they are not paid overtime by employers – the temporary day labor agencies.  They are charged excessive fees, treated with disrespect by the dispatches that send them out, and they are blacklisted or blackballed if they raise any concerns about company policies or safety procedures.  Typically, thee workers perform the most difficult, hot, dirty, heavy, and dangerous work in the region.  They are most frequently paid between $5.15 and $6.25 an hour without benefits.  While many perceive laborers to be unskilled, and reality is that their skills are not recognized and compensated accordingly.  Workers are not provided with appropriate safety gear and are sent out to work on unsafe equipment and in positions that have a high degree of risk for personal injury.

            The agencies make local companies sign contracts that forbid them from hiring a worker until they work ninety continuous days.  Often workers find their tickets disappear shortly before reaching their barrier – then both the client company and day worker have to start from day one.  The workers participating in the study have indicated that the day labor agencies actively participate in discrimination on the basis of race, gender, nationality and disability.  Also dispatchers at the agency engage in the practice of favoritism – sending out workers who they are friends with before other workers who they are friends with before other workers who are ready and willing to work.

            Workers interviewed have reported that it has become significantly more difficult finding jobs directly through a company.  Two factors have played a role in this new dynamic.  Many companies have left the city and relocated in industrial parts along the outer ring highways that circle the perimeter of the city.  This makes it extremely difficult for workers to apply for jobs at these shops.  Secondly, employers have sought to avoid paying workers’ compensation, unemployment insurance, and benefits by using temporary agencies for workers.  The downsizing, outsourcing and movement towards flexible production that has typified the industrial reorganization of this region in the past thirty years has meant that temporary employees who can be called on and let go at a moment’s notice, have become heavily utilized than they were in the 1920s.

            While this shift has in many ways benefited local industrial concerns, and it has very much benefited the temporary day labor agencies, it has displaced an inordinate amount of risk onto the workers.  These workers no longer have jobs with security or benefits and they have substandard wages.  While these workers have borne the risks, they have not shared in any of the benefits of the economic expansion of the 1990s.

            A series of structural changes within the labor market can be implemented that will allow these workers to get paid a living wage with benefits.  First and foremost, a non-profit community hiring hall can address many of the grievances of current day laborers and provide them with the material basis from which they can live with dignity and respect.  Secondly, we believe the city, county, organized labor, regional employers, and non-profits with an interest in employment can become full partners with this hiring hall.

            To supplement the establishment of this hall, the city, state and federal government need to regulate the employment leasing industry.  The leasing method was developed to bypass the regulations of the fee-charging placement agencies of old.  The staffing industry has argued that they are capable of policing their own, but as this report will document, they have abysmally failed in doing so.

Copyright NEOCH published 2001 Issue 50