Worker Protection: Labor's Efforts to Enforce Protections for Day
Laborers Could Benefit from Better Data and Guidance (26-SEP-02, 
GAO-02-925).							 
                                                                 
Day laborers generally are individuals who work and get paid on a
daily or short-term basis. To find work, they often congregate on
street corners and wait for employers to drive by and offer them 
work. Day laborers may also be employed by temporary staffing	 
agencies that assign them work on a daily basis with client	 
employers. Day laborers have an informal relationship with the	 
labor market, often working for different employers each day,	 
being paid in cash, and lacking key benefits, such as health or  
unemployment insurance. However, day laborers may be eligible for
wage and safety protections provided by the Fair Labor Standards 
Act (FLSA) and the Occupational Safety and Health (OSH) Act. The 
U.S. Department of Labor administers both acts. Its Wage and Hour
Division (WHD) is responsible for ensuring that all covered	 
workers receive at least the federal minimum hourly wage and	 
overtime pay. The Occupational Safety and Health Administration  
(OSHA) is required to ensure that employers provide safe and	 
healthy workplaces to help their workers avoid injury or death.  
Coverage under both laws does not depend on a worker's		 
immigration status. Although limited, information on the nature  
and size of the day laborer workforce suggests that these workers
may be prone to workplace abuses and are probably undercounted.  
Available information shows that day laborers are generally young
Hispanic men with little education and significant language	 
barriers, with some also being undocumented. The only nationally 
representative data on the day laborer population comes from	 
Labor's Bureau of Labor Statistics, but these data may undercount
day laborers. The unique characteristics of day laborers and	 
their work affect Labor's ability to enforce the protections	 
afforded them by federal law. First, neither WHD nor OSHA can get
complete information about potential violations involving day	 
laborers, making it difficult to target resources. Second, WHD's 
and OSHA's investigative procedures make it difficult to detect  
violations of worker protection laws involving day laborers, who 
often have nonstandard work arrangements. Finally, WHD officials 
are uncertain about the extent of coverage for day laborers in	 
some cases, and the responsibilities of temporary staffing	 
agencies under the OSH Act are unclear. Refer to GAO-02-1130 for 
a Spanish language version of this report.			 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-02-925 					        
    ACCNO:   A05101						        
  TITLE:     Worker Protection: Labor's Efforts to Enforce Protections
for Day Laborers Could Benefit from Better Data and Guidance	 
     DATE:   09/26/2002 
  SUBJECT:   Labor force					 
	     Labor law						 
	     Labor supply					 
	     Law enforcement					 
	     Occupational safety				 
	     Safety regulation					 
	     Safety standards					 
	     Temporary employment				 
	     Working conditions 				 

                                                                 
Worker Protection: Labor's Efforts to Enforce Protections for Day
Laborers Could Benefit from Better Data and Guidance (26-SEP-02, 
GAO-02-925).							 
                                                                 
Day laborers generally are individuals who work and get paid on a
daily or short-term basis. To find work, they often congregate on
street corners and wait for employers to drive by and offer them 
work. Day laborers may also be employed by temporary staffing	 
agencies that assign them work on a daily basis with client	 
employers. Day laborers have an informal relationship with the	 
labor market, often working for different employers each day,	 
being paid in cash, and lacking key benefits, such as health or  
unemployment insurance. However, day laborers may be eligible for
wage and safety protections provided by the Fair Labor Standards 
Act (FLSA) and the Occupational Safety and Health (OSH) Act. The 
U.S. Department of Labor administers both acts. Its Wage and Hour
Division (WHD) is responsible for ensuring that all covered	 
workers receive at least the federal minimum hourly wage and	 
overtime pay. The Occupational Safety and Health Administration  
(OSHA) is required to ensure that employers provide safe and	 
healthy workplaces to help their workers avoid injury or death.  
Coverage under both laws does not depend on a worker's		 
immigration status. Although limited, information on the nature  
and size of the day laborer workforce suggests that these workers
may be prone to workplace abuses and are probably undercounted.  
Available information shows that day laborers are generally young
Hispanic men with little education and significant language	 
barriers, with some portion also being undocumented. The only	 
nationally representative data on the day laborer population	 
comes from Labor's Bureau of Labor Statistics, but these data may
undercount day laborers. The unique characteristics of day	 
laborers and their work affect Labor's ability to enforce the	 
protections afforded them by federal law. First, neither WHD nor 
OSHA can get complete information about potential violations	 
involving day laborers, making it difficult to target resources. 
Second, WHD's and OSHA's investigative procedures make it	 
difficult to detect violations of worker protection laws	 
involving day laborers, who often have nonstandard work 	 
arrangements. Finally, WHD officials are uncertain about the	 
extent of coverage for day laborers in some cases, and the	 
responsibilities of temporary staffing agencies under the OSH Act
are unclear.							 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-02-925 					        
    ACCNO:   A05101						        
  TITLE:     Worker Protection: Labor's Efforts to Enforce Protections
for Day Laborers Could Benefit from Better Data and Guidance	 
     DATE:   09/26/2002 
  SUBJECT:   Labor supply					 
	     Occupational safety				 
	     Safety regulation					 
	     Safety standards					 
	     Temporary employment				 
	     Working conditions 				 
	     Labor force					 
	     Labor law						 
	     Law enforcement					 

******************************************************************
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GAO-02-925

Report to the Honorable Luis V. Gutierrez House of Representatives

United States General Accounting Office

GAO

September 2002 WORKER PROTECTION

Labor*s Efforts to Enforce Protections for Day Laborers Could Benefit from
Better Data and Guidance

GAO- 02- 925

Why GAO Did This Study

Day laborers are individuals who generally work for different employers
and get paid on a daily basis. They may congregate on street corners and
wait for employers to offer them work. Little is actually known about
these workers or their working conditions. Congressional representatives,
researchers, and advocacy groups have raised concerns that day laborers
may be used for the most hazardous work but not paid appropriate wages or
provided safe working conditions. Due to these concerns, GAO was asked to
determine what is known about the day laborer workforce and identify the
factors that affect Labor*s ability to enforce the protections afforded
day laborers under certain labor laws.

September 2002 WORKER PROTECTION Labor*s Efforts to Enforce Protections
for Day Laborers Could Benefit from Better Data and Guidance

This is a test for developing highlights for a GAO report. The full
report, including GAO's objectives, scope, methodology, and analysis is
available at www. gao. gov/ cgi- bin/ getrpt? GAO- 02- 925. For additional
information about the report, contact Robert E. Robertson (202- 512-
7215). To provide comments on this test highlights, contact Keith Fultz
(202- 512- 3200) or e- mail HighlightsTest@ gao. gov.

Highlights of GAO- 02- 925, a report to the Honorable Luis V. Gutierrez,
House of Representatives

What GAO Recommends

GAO recommends that Labor obtain better information about the presence of
day laborers or violations experienced by day laborers. GAO also
recommends that Labor provide guidance to its local offices to ensure more
consistent enforcement of protections for day laborers.

The Department of Labor provided GAO with written comments on a draft of
this report, emphasizing its commitment to protecting all workers,
including day laborers. While Labor did not comment on all
recommendations, it agreed with those it did comment on.

United States General Accounting Office

What GAO Found

Although limited, existing information on the nature and size of the day
laborer workforce suggests that these workers may be prone to workplace
abuses and are probably undercounted. While individual sources may be
limited in scope, taken together, they indicate that day laborers are
generally young Hispanic men with limited educational skills and
significant language barriers, with some portion being undocumented. These
characteristics make workers vulnerable to various types of workplace
dangers and abuses. The only nationally representative data on the day
laborer population comes from Labor*s Bureau of Labor Statistics, which in
2001 identified about 260,000 day laborers who wait on street corners for
employment. However, these data may undercount day laborers. The
methodology used to collect this information may affect Labor*s ability to
reach people not having fixed addresses, a condition that may apply to day
laborers.

A number of factors relevant to day laborers and their work affect Labor*s
ability to enforce the protections afforded them under laws that also
cover many other workers. Labor has difficulty getting complete
information about potential violations involving day laborers. Also,
Labor*s investigative procedures are generally not designed for
individuals in nonstandard work arrangements such as day laborers.
Finally, Labor officials in local offices are uncertain about the extent
of coverage for some day laborers and the responsibilities of some
employers who employ day laborers.

Day laborers at an employer*s truck. Source: Latin American Workers*
Project, New York. G A O Accountability Integrity Reliability

Highlights

Page i GAO- 02- 925 Protections for Day Laborers Letter 1

Results in Brief 2 Background 3 Available Data Suggest that Day Laborer
Population Is Vulnerable

and May Be Undercounted 10 Labor*s Efforts to Enforce Protections for Day
Laborers Are

Hampered by Limited Data, Traditional Procedures, and Difficulty in
Determining Coverage 13 Conclusions 24 Recommendations for Executive
Action 25 Agency Comments and Our Evaluation 26

Appendix I Identification and Selection of Agencies Serving Day Laborers
29

Identifying Agencies Serving Day Laborers 29 Selecting Agencies Serving
Day Laborers 30

Appendix II Services Provided to Day Laborers by Selected Nonprofit
Agencies 32

Description of Nonprofit Agencies Visited 32

Appendix III Selected Features of FLSA and Requirements in Four States 36

Appendix IV Comments from the Employment Standards Administration 39

GAO Comments 42

Appendix V Comments from the Occupational Safety and Health Administration
43

GAO Comments 47

Appendix VI GAO Contacts and Staff Acknowledgments 48 GAO Contacts 48
Staff Acknowledgments 48 Contents

Page ii GAO- 02- 925 Protections for Day Laborers Tables

Table 1: Agencies Participating in Structured Interviews 31 Table 2:
Description of Agencies GAO Visited and the Services

They Provide 32

Figures

Figure 1: Day Laborers Waiting for Employment 4 Figure 2: Day Laborers at
an Employer*s Truck 5 Figure 3: Shelter Construction at an Organized Day
Labor Site 6 Figure 4: Day Laborers Signing up for Work 6 Figure 5: An
Organized Day Labor Site 7

Abbreviations

BLS Bureau of Labor Statistics CHIRLA Coalition for Humane Immigration
Rights of Los Angeles CPS Current Population Survey DLSA Day Labor
Services Act FLSA Fair Labor Standards Act of 1938 OSHA Occupational
Safety and Health Administration OSH Act Occupational Safety and Health
Act of 1970 WHD Wage and Hour Division

Page 1 GAO- 02- 925 Protections for Day Laborers

September 26, 2002 The Honorable Luis V. Gutierrez House of
Representatives

Dear Mr. Gutierrez: *Day laborers* is a term that generally refers to
individuals who work and get paid on a daily or short- term basis. To find
work, day laborers often congregate on street corners and wait for
employers to drive by and offer them work. The term also includes those
who may be employed by temporary staffing agencies that assign them work
on a daily basis with client employers. Day laborers have an informal
relationship with the labor market, often working for different employers
each day, being paid in cash, and lacking key benefits, such as health or
unemployment insurance. However, day laborers, like many other workers in
this country, may be eligible for wage and safety protections provided
under two key federal laws: the Fair Labor Standards Act (FLSA) and the
Occupational Safety and Health Act (OSH Act). The U. S. Department of
Labor (Labor) administers both acts: the former through its Employment
Standards Administration*s Wage and Hour Division (WHD), the latter
through its Occupational Safety and Health Administration (OSHA). WHD is
responsible for ensuring that all covered workers receive at least the
federal minimum hourly wage and overtime pay. OSHA is required to ensure
that employers provide safe and healthy workplaces for their workers to
avoid injury or death. Coverage under both laws does not depend on a
worker*s immigration status.

Because of day laborers* informal relationship with the labor market,
congressional representatives, researchers, and advocacy groups have
raised concerns that day laborers may be used for the most hazardous work
but not paid appropriate wages or provided safe working conditions.
However, little is actually known about who these day laborers are, what
their working conditions are, or the extent to which protections afforded
under federal wage and safety and health laws are enforced. As a result,
you asked us to determine what is known about the nature and size of the
day laborer workforce and identify the key factors that affect Labor*s
ability to enforce the protections afforded day laborers under FLSA and
the OSH Act.

To determine what is known about the size and nature of the day laborer
workforce, we reviewed available data on day laborers, such as

United States General Accounting Office Washington, DC 20548

Page 2 GAO- 02- 925 Protections for Day Laborers

information from Labor*s Bureau of Labor Statistics (BLS) on day laborers
and available studies, and interviewed representatives of key national
associations representing day laborers and employers who use them. We also
conducted structured interviews with 25 nonprofit, local government, or
temporary staffing agencies that work with or employ day laborers (see
app. I for more details on how we selected these agencies). To identify
the key factors that affect Labor*s ability to enforce the protections
afforded day laborers under FLSA and the OSH Act, we reviewed provisions
of FLSA and the OSH Act, implementing regulations and guidance; obtained
and reviewed enforcement procedures; and analyzed enforcement statistics
from WHD and OSHA. For both objectives, we interviewed federal WHD and
OSHA officials in Washington, D. C., as well as state labor officials in
four states* California, Illinois, New York, and Virginia. 1 During our
state visits, we visited nonprofit and local government agencies that work
with day laborers and interviewed day laborers at each site we visited. We
also compared provisions of the wage laws and requirements of these states
with FLSA (see app. III for this comparison). We performed our work
between December 2001 and August 2002 in accordance with generally
accepted government auditing standards.

Although limited, existing information on the nature and size of the day
laborer workforce suggests that these workers may be prone to workplace
abuses and are probably undercounted. Available information shows that day
laborers are generally young Hispanic men with limited educational skills
and significant language barriers, with some portion also being
undocumented. Research has shown that these characteristics are typical of
workers willing to accept lower wages or work in substandard conditions.
The only nationally representative data on the day laborer population
comes from Labor*s BLS, but these data may undercount day laborers. For
example, the methodology BLS uses to collect this information may affect
BLS*s ability to reach respondents not having telephones or fixed
addresses* conditions that may apply to day laborers. In 2001, BLS
identified about 260,000 day laborers who wait on street corners for
employment, yet one study of day laborers in California identified about
20, 000 day laborers in one metropolitan area alone.

1 We selected these states based on a variety of state- specific factors,
including perceived high numbers of day laborers; use of day laborers at
nationally important locations, such as the World Trade Center and the
Pentagon sites; and local efforts to enforce existing laws. Results in
Brief

Page 3 GAO- 02- 925 Protections for Day Laborers

A number of factors that are directly relevant to the unique
characteristics of day laborers and their work affect Labor*s ability to
enforce the protections afforded them under FLSA and the OSH Act. First,
because neither WHD nor OSHA can get complete information about potential
violations involving day laborers, it is hard to focus resources on them.
For example, day laborers are generally reluctant or unaware of their
right to complain to authorities about not being paid promised wages or
working in unsafe conditions. Similarly, available information that Labor
uses to target its investigations, such as data on injuries and
fatalities, may not accurately reflect the extent to which day laborers
are injured or killed. As a result, neither WHD nor OSHA may be reaching
those industries or workplaces where day laborers work. Although both
agencies have made efforts to educate workers or obtain better data, these
efforts may not be sufficient. Second, WHD*s and OSHA*s investigative
procedures make it difficult to detect violations of worker protection
laws involving day laborers who often have nonstandard work arrangements.
As a result, the procedures may cause both agencies to miss violations.
Finally, WHD officials are uncertain about the extent of coverage for day
laborers in some cases, and the responsibilities of temporary staffing
agencies under the OSH Act are unclear. This may lead to inconsistencies
in the protections provided to day laborers. For example, even though FLSA
can cover employees working for homeowners in a domestic service capacity,
some local WHD officials we interviewed did not believe this provision
applied to day laborers. Also, because the responsibilities of temporary
staffing agencies under the OSH Act to ensure the safety of workers they
assign to client employers are not clearly delineated, OSHA officials had
different approaches to holding temporary staffing agencies accountable
for the safety of these workers.

We are making recommendations to the Secretary of Labor to improve Labor*s
efforts to protect day laborers, including obtaining better information to
help focus resources on day laborers and clarifying requirements under
FLSA and the OSH Act. Labor generally agreed with those recommendations
that it commented on.

Day labor is a phenomenon that is not new to the United States; it has
traditionally served as an informal device for bringing together employers
who need workers and individuals willing to work. Both in times of
economic prosperity or downturn, employers see many advantages to using
day laborers* there are generally few commitments the employer must make
to the day laborer, and the employer has the flexibility of using the day
laborer only when work is available. Additionally, there are Background

Page 4 GAO- 02- 925 Protections for Day Laborers

numerous reasons why individuals would work as day laborers* for some, it
is an opportunity to earn income when temporarily laid off; for others, it
is a first job in the United States; for yet others, it is the only
employment option available given substance abuse or other social
difficulties. In other cases, this informal relationship offers an
opportunity for employers to avoid paying employment taxes and offers
workers a chance to earn undetected income.

There are generally two types of day laborers. The first type of day
laborer is one that gathers on street corners, waiting for employers to
drive by and offer them daily employment. (See figs. 1 and 2.)

Figure 1: Day Laborers Waiting for Employment

Source: Latin American Workers* Project, New York.

Page 5 GAO- 02- 925 Protections for Day Laborers

Figure 2: Day Laborers at an Employer*s Truck

Source: Latin American Workers* Project, New York.

Across the country, there are likely thousands of street corners or
informal meeting places where day laborers wait for work. In these
locations, it is up to the day laborer and the employer to negotiate a
wage and various conditions of work. In many locations, however, nonprofit
or local government agencies have made efforts to gather day laborers at a
single site and establish procedures for obtaining work, negotiating
wages, and ensuring that wage and safety requirements are met (see figs. 3
to 5). Appendix II describes how several of these agencies operate.

Page 6 GAO- 02- 925 Protections for Day Laborers

Figure 3: Shelter Construction at an Organized Day Labor Site

Source: Latin American Workers* Project, New York.

Figure 4: Day Laborers Signing up for Work

Source: Latin American Workers* Project, New York.

Page 7 GAO- 02- 925 Protections for Day Laborers

Figure 5: An Organized Day Labor Site

Source: GAO.

The second type of day laborer is one that is employed by for- profit
temporary staffing agencies that assign them to work at client employers
on a daily basis. To receive these assignments, day laborers must
physically report to the temporary staffing agency office. In many cases,
these workers are also paid on a daily basis by payroll check* in fact,
one agency*s motto is *Work today; get paid today.* Generally, the
temporary staffing agencies that employ day laborers are not those that
are known for providing professional or administrative white or pink-
collar workers to client employers.

No national data on day laborers existed until 1995, when BLS surveyed
various types of *contingent* workers. 2 This survey was conducted as a

2 The term *contingent* has been used for many years to describe a variety
of nonstandard work arrangements. It describes the impermanent nature of
certain work arrangements, such as those (1) providing a relatively low
level of job security, (2) with more variable or less predictable hours,
and (3) that reflect a change in the traditional rights of workers and the
benefits offered to them.

Page 8 GAO- 02- 925 Protections for Day Laborers

supplement to BLS*s monthly Current Population Survey (CPS). 3 BLS has
conducted the supplemental survey four times: 1995, 1997, 1999, and 2001.
Several researchers have also conducted studies on particular groups of
day laborers in select locations across the country, including Los Angeles
and Chicago. These studies attempted to obtain information not only about
day laborers* demographics and work characteristics, but also about the
extent to which day laborers may be experiencing violations of existing
laws.

Day laborers, like many other workers in the United States, may be covered
by the two federal laws that govern basic wage and workplace safety
protections: FLSA and the OSH Act. To be covered, the worker must be *an
employee* as defined by the law, among other requirements. The protections
afforded by these laws do not extend to independent contractors. FLSA
requires that employers pay the federal hourly minimum wage and overtime
to covered workers, while the OSH Act requires employers to provide a
workplace free of recognized hazards in order to avoid worker injury,
illness, or death. To comply with the law, employers may have to provide
safety training and personal protective equipment, among other practices.

FLSA originally covered only those employees engaged in interstate
commerce or in the production of goods for commerce. 4 Coverage was later
extended to include all employees of a business *enterprise* that met
certain criteria. 5 Specifically, under the current law, all employees of
an employer (such as those working for a temporary staffing agency) would
be covered if it had some employees engaged in interstate commerce or in
the production of goods for commerce and annual gross sales or business
volume of at least $500,000. If annual gross sales were below $500,000,
only those employees actually engaged in activities involving interstate
commerce would be covered. Such activities might include taking orders
over the telephone from customers in another state or transporting
equipment to another state. Coverage under the OSH Act is broader. All
employees of a particular employer are covered if the employer is engaged
in a business affecting commerce. Coverage under the OSH Act does not

3 The CPS surveys approximately 50, 000 households each month. This
information is the primary source of nationally representative data used
to develop national employment and unemployment rates.

4 See P. L. No. 75- 718 S:S: 6, 7 (1938). 5 See P. L. No. 87- 30 S:S: 5(
b), 6( a) (1961).

Page 9 GAO- 02- 925 Protections for Day Laborers

depend on the specific activities of the employee or the volume of the
employer*s business.

FLSA specifically covers individuals working as employees in a domestic
service capacity for homeowners, performing tasks that would ordinarily be
performed by the homeowner. 6 Examples of such tasks include gardening,
housecleaning, or chauffeuring. On the other hand, while the OSH Act is
silent on its coverage of domestic service workers, an OSHA regulation
specifically excludes homeowners who employ workers in a domestic service
capacity. 7 Coverage under both laws does not depend on a worker*s
immigration status.

To carry out their responsibilities, WHD and OSHA perform a number of
activities. They generally conduct workplace investigations that result
from a worker complaint or initiate them based on other information.
Recently, both agencies have increased their emphasis on compliance
assistance, that is, providing information to employers, workers, and
others of their rights under the laws. These efforts require WHD and OSHA
to work with state enforcement agencies. State laws play an important role
in supplementing FLSA*s protections because states may enact more
stringent provisions in their laws than in federal law. This means that a
state law could cover employers and individuals not covered under FLSA. If
an employer is covered under FLSA and a state law, the more stringent
provision of either law will generally apply. Under the OSH Act, OSHA has
delegated enforcement responsibility to state labor agencies in 23 states.
8 These states have the option of implementing more stringent requirements
than the federal program, and in many cases, they have done so. For
example, California requires employers to have an injury and illness
prevention program* something not required by OSHA.

6 Workers performing domestic service qualify for the minimum wage if they
work a total of more than 8 hours a week for one or more employers or
receive cash wages from one employer totaling at least $1,300 in 2002. See
29 U. S. C. S: 206( f); 66 Fed. Reg. 54047 (Oct. 25, 2001).

7 29 C. F. R. S: 1975.6. 8 The OSH Act allows states to operate their own
safety and health programs as long as they are determined by OSHA to be at
least as effective as the federal OSHA program. Two of the state programs
cover only state and local government employees.

Page 10 GAO- 02- 925 Protections for Day Laborers

Available information indicates that the day laborer workforce is prone to
workplace abuses and is probably undercounted. The characteristics of day
laborers that we and others identified, such as limited English
proficiency, are generally recognized by Labor and others as those that
make workers vulnerable to workplace abuses. Moreover, our work and other
recent research indicate that the size of the day laborer population may
be greater than nationally available data suggest.

While individual sources may be limited in scope, taken together, they
provide a general picture of the day laborer population as young Hispanic
men with limited educational skills and significant language barriers. Our
interviews with nonprofit and local government agencies working with day
laborers indicated that the majority of day laborers were Hispanic men,
with some portion being foreign born. 9 A study performed by a researcher
in California generally corroborated this, finding that nearly one- third
of the day laborer population studied had been in this country for less
than 1 year. 10 We also found that, even though the majority of the day
laborers were between 18 and 30 years old, they generally had less than a
high school education; the study in California found that, in some cases,
day laborers had only about 7 years of education. 11 We also found that
these workers often lacked basic proficiency in speaking or writing
English, with some of them not even proficient in their own language.
Finally, although we were unable to quantify the percentage, we found that
some portion of the day labor population was undocumented. 12 In some
cases,

9 We also identified some day laborers who were black, eastern European,
or female. Although available BLS data show most day laborers are white
(88 percent), this is because ethnicity is asked separately from race.
Thus, Hispanics will indicate first whether they are of white or black
race, then separately indicate their ethnicity as Hispanics. Data from the
survey show that Hispanics make up nearly 40 percent of the entire day
laborer population.

10 Abel Valenzuela, Jr., Working on the Margins: Immigrant Day Labor
Characteristics and Prospects for Employment, Working Paper No. 2, Center
for Comparative Immigration Studies, University of California- San Diego,
May 2000.

11 We did find a small percentage of day laborers who had more than a high
school diploma, usually obtained in their home country. 12 Individuals
working for temporary staffing agencies may be more likely to be
documented and authorized to work since they generally have to provide
documentation of their legal work status to their employer. However, we
were told of instances where temporary staffing agencies did not ask for
documentation or where day laborers provided fraudulent documentation.
Available Data

Suggest that Day Laborer Population Is Vulnerable and May Be Undercounted

Data on Day Laborer Characteristics Show a Population at Risk

Page 11 GAO- 02- 925 Protections for Day Laborers

day laborers working for temporary staffing agencies were slightly more
ethnically diverse, with higher levels of education and skills. 13

Research has shown that these characteristics make workers vulnerable to
various types of workplace dangers and abuses, a fact that Labor also
acknowledges. 14 First, immigrants to the United States, especially newer
ones, are more willing to accept lower wages and substandard work that
offers few benefits or protections, which makes them attractive to
unscrupulous employers who may exploit them as a cheap source of labor.
For example, often immigrants take the more informal, contingent work in
this country, and we found in a previous GAO report that workers in
contingent work arrangements had lower family incomes than those in
traditional work arrangements and many have incomes below the federal
poverty threshold. 15 Second, lower education and skill levels often mean
that workers are willing to take jobs that pose a greater health risk. In
that respect, we found that most of the day laborers worked in unskilled
occupations, such as laborer or landscaper, in more hazardous industries,
such as construction; day laborers working through temporary staffing
agencies were also employed in manual labor occupations in manufacturing
and warehousing. Lower educational levels also mean that workers may not
be aware of the labor protections available to them, their rights as
employees under the law, or the dangers associated with hazardous
conditions. Third, limited proficiency in speaking or reading English
makes it more difficult for workers to understand the relative risk of
their employment or communicate such dangers to employers, a point
stressed by representatives of several nonprofit and local government
agencies we interviewed that worked with day laborers. Finally, being
undocumented means that workers may not want to be found, so they will
endure a higher level of abuse to remain undetected.

13 Several temporary staffing agencies were unable to provide specific
information on race, age, and educational levels because they do not
collect this type of information. 14 This report does not fully address
the characteristics or vulnerability of day laborers who are not served by
any group, as that information is difficult to obtain. For example, we
heard of Chinese day laborers in New York working for storefront or *fly-
by- night* temporary staffing agencies. These workers are likely to be as
vulnerable as those day laborers working with the agencies we contacted.

15 See U. S. General Accounting Office, Contingent Workers: Incomes and
Benefits Lag Behind Those of Rest of Workforce, GAO/ HEHS- 00- 76,
(Washington, D. C.: June 30, 2000). The Department of Health and Human
Service*s 2002 Poverty Guidelines identifies the poverty threshold for a
family of three as $15,020.

Page 12 GAO- 02- 925 Protections for Day Laborers

The only nationally representative source of data on day laborers is BLS*s
CPS Contingent Work Supplement. For a variety of reasons, these data may
underestimate the actual number of day laborers seeking work in the United
States. Data from the survey show that in 2001, there were about 260,000
individuals working as day laborers. 16 BLS also reported that about 1.2
million workers found work through temporary staffing agencies in 2001,
but the survey does not attempt to determine what percent of those
individuals, if any, were day laborers. Other studies of day laborers are
not national in scope, but may indicate the presence of relatively large
numbers of day laborers. For example, one study of day laborers in
Southern California estimated the population to be as high as 20,000 in
one metropolitan area. 17 Based on our interviews with nonprofit and local
government agencies that serve day laborers on street corners, we
identified about 2,600 day laborers who seek work daily from 28 street
corners identified by these agencies. Regarding day laborers working
through temporary staffing agencies, staff at one agency serving day
laborers estimated that about 30,000 day laborers were sent out each day
by temporary staffing agencies in Chicago alone. Moreover, one national
temporary staffing agency we interviewed reported that it employed almost
700,000 individuals as day laborers in 2001.

When one considers the methods used by BLS to collect data on day
laborers, the findings of these additional studies may be even more
convincing as to the potential undercounting of day laborers. We have
reported that BLS*s methodology is inadequate for measuring certain hard-
to- reach segments of the population and, as a result, may undercount
them. 18 For example, BLS*s survey relies on address lists that are
dependent on stable or established residences. Day laborers may move
frequently to find work or live with relatives. In addition, BLS does most
of the interviewing by telephone, and day laborers may not have access to
a

16 BLS does not publish information on day laborers separately, but while
the number of other types of contingent workers has remained relatively
stable since 1995, the number of day laborers has increased by 135
percent. In 2001, day laborers accounted for about 2 percent of the
contingent workforce.

17 See footnote 10. 18 U. S. General Accounting Office, Child Labor in
Agriculture: Changes Needed to Better Protect Health and Educational
Opportunities, GAO/ HEHS- 98- 193, (Washington, D. C.: Aug. 21, 1998).
Size of the Day Laborer

Population May Be Greater than Available Data Indicate

Page 13 GAO- 02- 925 Protections for Day Laborers

telephone, or speak English. 19 Finally, individuals who are wary of
government may avoid participating in surveys. None of the day laborers we
interviewed at the four sites we visited recalled ever being surveyed by
the government. 20

A number of factors affect Labor*s ability to enforce the protections
afforded day laborers under FLSA and the OSH Act. 21 The limited
information available on day laborers makes it difficult for WHD and OSHA
to focus resources on them. In addition, traditional investigative
procedures used by WHD and OSHA may hurt their ability to detect
violations affecting employees in nonstandard work arrangements, such as
day laborers. Finally, applying FLSA and the OSH Act to day laborers is
challenging because it requires sufficient information and resources to
determine coverage. In addition, in some cases, WHD officials are
uncertain about the extent of coverage for day laborers under FLSA, and
the responsibilities of temporary staffing agencies under the OSH Act are
unclear, which may lead to situations where day laborers are not
protected.

WHD and OSHA generally rely on two types of information to conduct
investigations to identify potential violations. They (1) rely on
complaints from individuals who believe they may have suffered a violation
and (2) analyze data on wages or workplace conditions to specifically
target

19 BLS said that it can conduct the survey in person if necessary and does
have the ability to conduct the survey in Spanish; however, some day
laborers may not have a fixed address or may speak a language other than
Spanish.

20 Moreover, the characteristics of this workforce reflected in BLS*s data
raise questions about the extent to which BLS reaches day laborers
employed by temporary staffing agencies. For example, BLS*s 2001 data show
that individuals working for temporary staffing agencies are predominately
white and employed in clerical and administrative occupations, which does
not reflect the characteristics of day laborers working for temporary
staffing agencies.

21 We determined that the day laborers who were the subject of our review
generally do not appear to meet the legal criteria to be considered
independent contractors under the OSH Act or FLSA. We determined this
through our structured interview questions regarding the ownership of
tools and transportation and the supervision of employees. Labor*s Efforts
to

Enforce Protections for Day Laborers Are Hampered by Limited Data,
Traditional Procedures, and Difficulty in Determining Coverage

Limited Information about Day Laborers Makes it Difficult to Focus
Resources on Them

Page 14 GAO- 02- 925 Protections for Day Laborers

problematic industries or worksites. In both cases, this information fails
to identify the presence of day laborers or potential violations affecting
them.

Both WHD and OSHA initiate much of their enforcement activity in response
to complaints filed by individual workers. In fiscal year 2001, about 70
percent of WHD*s investigations under FLSA were complaintdriven; for some
industries, such as the construction or temporary staffing industry, the
majority of the investigations it conducted were due to complaints. OSHA
is required by law to respond to all valid complaints about serious
hazards from employees, 22 although it relies less heavily on complaints
than WHD, historically initiating about 20 percent of its investigations
based on complaints. 23 However, WHD and OSHA officials reported that they
received few or no complaints from day laborers. Day laborers may not
complain for a variety of reasons. For some day laborers, language
barriers may prevent them from being aware of or taking advantage of their
right to complain to authorities. In addition, the day laborers may fear
loss of employment, either through employer retribution, deportation, or
the time necessary to file and resolve a complaint. 24 Representatives of
nonprofit agencies serving day laborers told us of cases where, even when
they have filed complaints, they have received little action from WHD or
it has taken too long for WHD to complete a case. 25

Nonetheless, available information indicates day laborers face numerous
potential violations. Many of these potential violations involve
nonpayment of wages, including overtime. For example, the majority of
nonprofit and local government agencies working with day laborers we
interviewed reported that day laborers complained at least once a week
about nonpayment of wages. These agencies reported that they recovered

22 OSHA also responds to all fatalities, catastrophes, and cases of
imminent danger. 23 In some states, the percentage of compliant- driven
inspections is higher than the national average. 24 In one of our previous
reports, Labor officials reported that there is a misperception among the
foreign- born working community, actively promoted by those who do not
want employees to cooperate with Labor, that cooperating with Labor will
automatically result in an Immigration and Naturalization Service
investigation. See U. S. General Accounting Office, Illegal Aliens:
Significant Obstacles to Reducing Unauthorized Alien Employment Exists,
GAO/ GGD- 99- 33, (Washington, D. C.: Apr. 2, 1999).

25 We reviewed a sample of complaint- based investigations in the
temporary staffing industry for both OSHA and WHD and confirmed that none
of the complaints came from day laborers.

Page 15 GAO- 02- 925 Protections for Day Laborers

over $750,000 in owed wages that day laborers did not receive from
employers in 2001. Other researchers corroborated our findings, reporting
that over half of the day laborers in their studies were not paid the
wages due to them. 26 Violations may also involve the safety and health of
day laborers. For example, the majority of the nonprofit and local
government agencies working with day laborers that we interviewed said
that few, if any, day laborers receive personal protective equipment or
safety training. Other researchers corroborated our findings, with one
reporting that 75 percent of day laborers in the study did not receive
protective equipment when performing hazardous work. 27 Many researchers
and agencies dealing with day laborers agreed that day laborers
underreport their concerns about workplace safety and health because they
believe no corrective action will be taken and are willing to risk their
safety as long as they are paid.

Labor has made various efforts to address the fact that day laborers are
less likely to complain. These efforts include educating workers and
improving access to the complaint process. For example, in Chicago, OSHA
and WHD have been working with nonprofit and faith- based organizations to
educate workers about their rights and help them identify potential
violations. As a result, OSHA received complaints that resulted in 35
cases with violations that it may not have otherwise detected. In its
comments on a draft of this report, WHD said that it has been increasing
its appearances on Spanish- speaking radio and television in an effort to
inform workers about their rights. OSHA, in its comments, also provided
additional information on its efforts to provide assistance with safety
and health training for day laborers. According to nonprofit agencies we
interviewed that work with day laborers, information and assistance
provided to day laborers led to improved working conditions and a decline
in the need to file complaints. We did not find similar levels of outreach
in all locations we visited, and not all outreach efforts have included
temporary staffing agencies or a broad range of organizations that work
with day laborers.

Regarding access to the complaint process, OSHA has translated its
complaint form and other publications into Spanish, created a

26 See, for example, Dan Kerr and Chris Dole, Challenging Exploitation and
Abuse: A Study of the Day Labor Industry in Cleveland, Prepared for the
Cleveland City Council, Ohio, Sept. 2, 2001.

27 See footnote 10.

Page 16 GAO- 02- 925 Protections for Day Laborers

1- 800 telephone number accessible to Spanish speakers, and developed a
Spanish language web site. OSHA has also compiled a list of Spanish
speakers in the agency and has formed an Hispanic Task Force that is,
among other things, developing recommendations for implementing a national
strategy to address the problems of Hispanic and immigrant worker
populations. WHD is in the process of translating compliance assistance
materials into Spanish and has about one- quarter of its staff that speak
Spanish. WHD*s national office told us that it has developed a *Wage Hours
Recordkeeper* in English and Spanish to provide temporary and transient
workers* such as day laborers* the information needed to determine if they
are paid properly. While both agencies are making progress in their
activities, these efforts may not reach the full range of day laborers,
since they generally lack access to the Internet, may speak languages
other than Spanish, or may be illiterate.

The second way that WHD and OSHA identify potential violations is by
analyzing available data on workplace demographics, conditions, and past
investigations to target problematic industries or worksites. Generally,
WHD targets industries with the lowest wages or the most vulnerable
workers. For example, WHD uses BLS data on worker demographics, yet as we
noted earlier, BLS data may undercount workers with characteristics
similar to those of day laborers. WHD also uses wage information to
identify low- paying occupations or industries, yet our research showed
that day laborers obtaining employment from street corners work an average
of 2 to 3 days a week and are generally paid in cash at the end of the
day. As a result, it is not clear whether these kinds of wage payments
would be reflected in data collected from employers on wages paid to
workers. On the basis of this type of information, WHD identified
industries other than construction or the temporary staffing industry for
their national targets. Yet, most of the agencies we surveyed reported
that a majority of day laborers work in the construction industry. 28
Finally, the database on past investigations that WHD uses to target
industries does not identify whether violations involve day laborers. For
example, WHD*s data show that, in 2001, temporary staffing agencies had a
higher likelihood of monetary violations than employers in any other
industries investigated, but the database does not identify whether any of
these workers are day laborers.

28 At the local level, WHD offices have the authority to target
construction. In 2001, about 3 percent of WHD*s investigations in
construction were targeted.

Page 17 GAO- 02- 925 Protections for Day Laborers

OSHA targets the most hazardous industries and worksites for
investigation, using injury and illness data collected and reported by
employers and its database on past investigations. However, this
information does not show where day laborers work or the full extent of
their injury experience because when employers record an injury, they are
not required to note whether the worker was a day laborer. Furthermore,
because client employers* not temporary staffing agencies* must record
injuries and fatalities of temporary staffing agency day laborers, the
data OSHA uses cannot identify the extent to which day laborers working
for temporary staffing agencies are injured or killed. Finally, when OSHA
targets particular worksites for investigation, the information it uses
may not reflect smaller worksites, where many day laborers work and which
experts believe are the most hazardous sites in the industry. For example,
OSHA targets construction at the national level, but the data it uses to
target worksites in the industry does not generally include construction
projects valued at less than $50, 000 and that are residential. OSHA*s
local offices have flexibility to exclude additional construction
worksites from targeted inspection; we found some local offices excluded
projects valued at up to $2,000,000. In addition, because OSHA counts
inspections by the number of contractors at a worksite, there is an
incentive to target larger construction worksites, which may be likely to
have more contractors.

Recently, both WHD and OSHA made efforts to collect additional data that
better identified potential violations involving day laborers working for
temporary staffing agencies. A regional WHD office collected data from a
randomly selected number of temporary staffing agencies to determine
whether these agencies were in compliance with FLSA. In 1997, local OSHA
offices in Ohio obtained workers* compensation data to better identify
injury rates for day laborers working at temporary staffing agencies. 29
These improved data helped the agencies determine wage and safety problems
that may have otherwise gone undetected. For example, WHD found that
almost one- third of temporary staffing agencies were not in compliance
with FLSA, while OSHA found that temporary staffing agencies had some of
the highest numbers of workers* compensation claims with total costs
exceeding $8.4 million. 30 In both cases, the offices

29 Although the client employer records an injury, the temporary staffing
agency pays workers* compensation for the injured worker. 30 High rates of
workers* compensation payments indicate either a large number of injuries
or potentially fewer injuries that incurred significant costs* an
indicator of a potentially hazardous work environment.

Page 18 GAO- 02- 925 Protections for Day Laborers

worked with the temporary staffing agencies to reduce wage and hour abuses
and ensure a safer workplace. For example, OSHA*s Ohio office began the
Choice program to work with temporary staffing agencies, providing
compliance assistance to smaller agencies and requiring on- site
investigations of all injuries involving temporary workers, such as day
laborers. Recent results show that 60 percent of the participating
temporary staffing agencies reduced their overall workers* compensation
costs and over half reduced the number of workdays lost to injuries and
illnesses. While these initiatives may help WHD and OSHA better identify
where day laborers work and the violations they face, the agencies have
not yet fully assessed the results of these efforts to consider their
application agencywide.

At the national level, OSHA is undertaking another effort to collect
additional data that will provide a better understanding of the extent to
which day laborers are involved in workplace fatalities. In 2002, OSHA
implemented a temporary procedure that required OSHA investigators, for
all fatality and catastrophe investigations, to determine if the worker
was foreign- born, Hispanic, or had language barriers. If that were the
case, the OSHA investigator would then determine if the worker was a day
laborer. OSHA has not yet begun to evaluate this information, but the
information should prove useful to gain a better understanding of day
laborers* fatality experience. However, this process is still in the pilot
stage and OSHA will not identify fatalities and catastrophic accidents of
day laborers that are not foreign born, Hispanic, or do not have language
barriers. Moreover, OSHA does not ask if the day laborer was provided
through a temporary staffing agency.

Although both WHD and OSHA conduct thousands of investigations each year
to detect employer noncompliance and remedy potential violations, their
investigative procedures may not be able to detect violations affecting
employees in nonstandard work arrangements, such as day laborers. As part
of their investigations, WHD and OSHA are visiting fewer worksites, and
WHD generally gives advance notice when it visits worksites. As a result,
both agencies may miss potential violations involving day laborers.

WHD and OSHA conduct thousands of investigations each year without
visiting worksites. For example, in 2001, WHD conducted as many as 55
percent of its investigations by fax or telephone. Although OSHA does not
keep similar statistics, since 1995, it has been encouraging its
investigators to handle complaint investigations informally by telephone.
Labor*s Investigative

Procedures Make it Difficult to Detect Violations Affecting Employees in
Nonstandard Work Arrangements

Page 19 GAO- 02- 925 Protections for Day Laborers

By not going on- site, investigators lose the opportunity to observe the
worksite or interview employees. Also, in some instances, the
investigations focus on a single worker, a single minor violation, or a
particular timeframe. All of these are activities that reduce WHD*s and
OSHA*s ability to uncover potential violations affecting day laborers. In
addition, FLSA provides Labor with no authority to assess penalties for
failing to keep accurate payroll records. 31 Without the threat of a
financial penalty from WHD and because employers may hire day laborers to
purposely avoid costs, such as overtime and taxes, wage records may not
reflect actual payments made to workers, such as day laborers. Without
visiting the workplace, WHD cannot compare employers* wage records with
individuals actually working at the site to make sure that the payroll
records accurately reflect all the workers and the payments made. WHD data
show that WHD is five times more likely to find violations of
recordkeeping requirements when it visits the workplace or collects
additional information.

When WHD does visit worksites, the procedures it uses may reduce the
likelihood of uncovering potential violations related to day laborers.
According to WHD guidance, investigators have the discretion to give
employers advance notice of an impending investigation, but it would be
inappropriate to provide such notice when there is reason to believe that
the employer*s behavior will change as a result of advance notice. The
local WHD offices we visited provided advance notice for the majority of
their investigations. Given that employers hire day laborers sporadically,
employers may choose not to hire day laborers on the day of the
investigation or alter records for the investigation, limiting WHD*s
opportunity to find day laborers.

Applying FLSA and the OSH Act to day laborers is challenging for a number
of reasons. In some cases, WHD lacks the necessary information on
potential violations or the resources to determine coverage under FLSA. In
other cases, the extent to which these laws cover day laborers is
uncertain. Even when these laws cover day laborers, they may not account
for the nonstandard work arrangements of day laborers, which could
jeopardize their economic or physical well- being.

31 A court can assess a penalty if an employer is convicted of willfully
violating recordkeeping requirements. 29 U. S. C. S:S: 215( a)( 5), 216(
a). Labor Faces Challenges

When Applying Provisions of FLSA and the OSH Act to Day Laborers

Page 20 GAO- 02- 925 Protections for Day Laborers

Applying FLSA and the OSH Act to day laborers is difficult because
coverage may depend upon the type of employer or the specific work a day
laborer performs. Under FLSA, day laborers employed by enterprises with an
annual business volume of more than $500,000 and some employees engaged in
interstate commerce are covered; this could include day laborers working
for large temporary staffing agencies. However, it is not always clear how
coverage would apply to day laborers employed by enterprises making less
than $500,000 per year because only those workers determined to be engaged
in interstate commerce or in the production of goods for commerce are
covered. According to WHD officials, in some cases, WHD officials are
unable to obtain the information needed to determine this coverage. For
example, we found that many day laborers work for small construction
subcontractors performing manual labor, such as installing drywall.
According to WHD officials, a determination would have to be made that the
building the day laborer worked on was to be used for interstate
commercial activity in order for the day laborer to be covered. However,
this kind of information is not always available. In other cases,
information on the employer location and hours worked is not readily
available. Proving such coverage can be difficult and resource- intensive.
Because WHD*s resources are limited, it must determine the potential
impact of investigating smaller employers that may have violations
affecting a small number of individuals versus larger employers that may
have greater numbers of individuals and more violations.

In other cases, coverage may depend on how local offices determine whether
an employee is engaged in the production of goods for commerce. For
example, a worker may be covered if engaged in an activity that is
*closely related or directly essential* to the production of goods for
interstate commerce. In applying this provision, WHD officials explained
that a day laborer serving as a security guard for a building that houses
companies involved in the production of goods would be covered because
that activity is closely related or directly essential to these interstate
activities. Yet, a day laborer mowing the lawn at the same building would
not be covered because that function would not be considered closely
related or directly essential to these interstate activities. The
distinction is not always obvious and Labor has recognized this in its
regulations. According to Labor, coverage cannot always be determined with
precision Some Provisions of FLSA and

the OSH Act Are Difficult to Apply

Page 21 GAO- 02- 925 Protections for Day Laborers

and may require authoritative decisions of the courts for a final
determination. 32

Regarding domestic service work, FLSA provides that employees doing
household chores are covered if they meet certain requirements. Not all
WHD officials appeared to recognize the application of this provision to
day laborers. WHD officials at headquarters said that day laborers picked
up from street corners would be covered by this provision of FLSA, while
officials in the WHD district offices we visited had differing views. For
example, one office interpreted this provision to cover only long- term
domestic employees. As a result, day laborers performing domestic service
work may be protected under this provision in some areas but not in
others.

Because of the difficulty in asserting coverage for individuals working
for small employers, WHD often refers such potential violations to state
enforcement agencies. 33 In some cases, state laws may provide greater
protection than FLSA. For example, all four states we visited protect the
wages workers were promised, which can exceed the federal minimum wage.
(App. III compares selected wage provisions under FLSA and the laws and
requirements of the four states we visited.) However, we found that, in
practice, advantages associated with relying on state enforcement agencies
may not be realized. First, not all states* laws cover small employers,
for example, neither Virginia*s nor Illinois* law covers employers with
four or fewer workers. As a result, day laborers working for very small
employers may be unlikely to get protection under FLSA or the state law.
Second, most of the state officials we interviewed said that their
investigations were *complaint- driven.* Officials in Illinois and New
York, for instance, reported spending all of their time responding to
complaints. This, combined with their limited resources, makes it unclear
that they could pursue all referrals from WHD. Third, officials in some
states we visited told us that their investigators rarely pursued
enforcement actions that required on- site investigations, relying
primarily on telephone or fax investigations. As a result, like WHD, state
agencies may also miss violations. This reliance on state enforcement
agencies may be even more problematic for day laborers not covered by FLSA
in those

32 29 C. F. R. S: 776.17. 33 WHD might also inform the individuals of
their private right of action to file suit in state or federal court.

Page 22 GAO- 02- 925 Protections for Day Laborers

states with less stringent protections, such as no minimum wage or
overtime provisions.

While day laborers employed by temporary staffing agencies are covered by
the OSH Act, the exact responsibilities of temporary staffing agencies and
that of their clients is not always clear. According to OSHA, temporary
staffing agencies are responsible for general safety training and the
provision of general personal protective equipment. Yet, there is no
clear, centralized guidance from OSHA on the legal responsibilities of
temporary staffing agencies or their clients to properly ensure the safety
of the day laborers they employ. Neither the OSH Act nor the implementing
regulations elaborate on these responsibilities. Furthermore, OSHA has
provided interpretations of the requirements in response to inquiries, but
temporary staffing agencies are not required to follow them. Determining
whether the temporary staffing agency or client employer is responsible
for providing training and can be cited for failing to ensure the safety
of their workers is a complex area that may be confusing, which may leave
day laborers without sufficient safety and health protections at the
worksite. For example, a local OSHA office cited both the temporary
staffing agency and client employer after temporary workers suffered
injuries at the client employer*s worksite for failing to provide
sufficient training and concluded that each employer believed the other
employer was responsible for training the workers. On the other hand, some
OSHA officials said that they would be less likely to cite temporary
staffing agencies. If temporary staffing agencies are not appropriately
cited, day laborers working for these agencies may be subject to
inadequate safety and health protections. A centralized source of
information clarifying the role of temporary staffing agencies and client
employers could allow OSHA to more uniformly apply the law and make it
easier for both temporary staffing agencies and client employers to
understand their responsibilities.

Even when WHD and OSHA are able to enforce protections under FLSA and the
OSH Act, certain practices allowed by these laws may adversely affect day
laborers* economic and physical well- being. The unique characteristics
and nonstandard work arrangements of day laborers make them more
susceptible to these practices than workers in traditional work
arrangements. These practices relate to wage deductions, transportation
safety, and compensation for time waiting to be employed. Addressing these
issues is difficult because any resolution would involve complicated
tradeoffs between the potential benefits to day laborers and the potential
costs to employers. Certain Practices under

Existing Laws May Adversely Affect Day Laborers

Page 23 GAO- 02- 925 Protections for Day Laborers

Under FLSA, an employer can take a variety of deductions from wages. 34
Employers can deduct charges for items such as meals, lodging,
transportation, or cashing of payroll checks as long as the item is for
the employee*s benefit and acceptance is voluntary and uncoerced.
Employers can deduct these items even if they bring wages below the
federal hourly minimum wage. 35 Employers can also deduct charges for
other items, such as tools or uniforms, as long as those items do not take
the employee*s wages below the federal hourly minimum wage. 36
Representatives of temporary staffing agencies told us that they generally
pay minimum wage or whatever the local market will bear and generally take
the standard deduction for taxes as well as other items, such as
transportation, from day laborers* pay. Agencies we interviewed that work
with day laborers reported that most day laborers relied on employers for
some of these items. 37 As a result, the hourly wage received by day
laborers can often be much less than the originally established wage.
Nonprofit and local government agencies working with day laborers told us
that some day laborers receive $2 an hour as a result of several
deductions. These practices do not generally affect traditional workers
because they do not rely on employers for services such as transportation,
check cashing, or meals.

Another practice that may have greater repercussions for day laborers than
for traditional workers concerns physical safety when commuting to and
from the worksite. Over the past 2 years, there have been several reports
of day laborers being killed or injured while being driven to a worksite
by an employer. In 2001, for example, a temporary worker was killed as she
was being transported by the temporary staffing agency to a job
assignment. OSHA did not investigate the case because it was outside its
jurisdiction. In general, individuals commuting to and from work are not
considered to be working, so their transportation safety is not covered
under the OSH Act. However, the commuting pattern for day laborers is
different than the pattern for workers in traditional work arrangements.

34 See 29 U. S. C. S: 203( m); 29 C. F. R. pt. 531. 35 These items can be
deducted only if they are customarily provided and priced at a reasonable
cost or fair value. 29 C. F. R. S:S: 531. 30-. 33,. 36-. 37. Check cashing
fees or other such deductions are illegal in some states.

36 See 29 C. F. R. S: 531.36( b). 37 One temporary staffing agency we
interviewed dispenses pay using a cash machine that charges a fee ranging
from $1 to $1.99. A pending class action suit in three states alleges this
practice is illegal.

Page 24 GAO- 02- 925 Protections for Day Laborers

Most workers in traditional work arrangements rely on their own car, a
carpool, or public transportation to get from home to the workplace. Day
laborers, on the other hand, travel from their homes to a nearby location,
such as a street corner or a temporary staffing agency, to obtain work.
Because day laborers often do not have access to a car or work in
locations inaccessible by public transportation, they depend on the
employer to get them from the street corner or temporary staffing agency
to the worksite. Federal law covers transportation for migrant and
seasonal agriculture workers to and from the job site if they are
transported by their employer. 38 Additionally, because employers are not
required by OSHA to record an injury that occurs during transport, OSHA
cannot determine how often this occurs. Assuming that day laborers are
less likely to receive workers* compensation or have health insurance, any
medical costs associated with the injury would be incurred by the
community at large.

Compensation for waiting time is another issue that may affect day
laborers differently than workers in traditional work arrangements. Most
workers in traditional work arrangements have a steady employer and
regular work location and go directly from home to the worksite. Day
laborers, on the other hand, must wait at particular locations to obtain
employment* even if they are employed by temporary staffing agencies. We
found that, in many cases, day laborers wait 3 to 4 hours before being
assigned a work assignment, spend between 1 to 3 hours in travel time to
and from the worksite, and generally work at least 8 hours on the job.
This could add up to a 12- to 15- hour day. According to WHD officials,
waiting on a street corner for a job offer or at a temporary staffing
agency for an assignment to a client is not counted as wait time. In
addition, even after a worker is provided a work assignment, WHD generally
would not consider the time it takes to get to the site to be compensable
work time under FLSA. 39

Both WHD and OSHA acknowledge that those individuals working as day
laborers are some of this nation*s most vulnerable workers. Moreover, both
struggle with the problem that the characteristics that make day

38 29 U. S. C. S: 1841. 39 Labor*s Office of the Solicitor commented that,
depending on the particular facts, some waiting time may be compensable,
such as when the waiting time occurs between the first and last tasks
performed during a workday. Conclusions

Page 25 GAO- 02- 925 Protections for Day Laborers

laborers most susceptible to workplace abuses also make it difficult for
Labor and others, especially in light of limited resources, to find and
protect them. It is also difficult to protect a group of workers that may
not want to be found. These difficulties may lead to workers who are not
receiving the protections they are entitled to under law, as well as
larger problems associated with an underground economy, illegal
immigration, and unreported income. Both WHD and OSHA have made a
commitment to protect these workers and others like them, but they are
hampered by incomplete data and difficulty in applying some of the legal
protections available to these workers.

Both agencies* efforts to protect day laborers could be enhanced by having
better information about where day laborers work and what violations they
may face. While current efforts to provide education and outreach and
collect additional data on day laborers have promise, such efforts can be
expanded. For example, efforts by OSHA and WHD may benefit from greater
involvement with temporary staffing agencies or a larger network of
agencies representing day laborers to ensure that day laborers are aware
of their rights. Also, WHD and OSHA could benefit by exploring the results
of their local efforts to collect additional data on day laborers working
for temporary staffing agencies. By not doing so, WHD and OSHA lose the
opportunity to identify better ways to obtain valuable information about
where day laborers work and the potential violations they face. Moreover,
unless OSHA refines and permanently implements its data collection
procedure for fatality investigations, it may not get a complete picture
of the number or characteristics of day laborers killed on the job.

Finally, WHD officials did not uniformly understand how to apply FLSA*s
domestic service provision to day laborers. Because of this apparent lack
of understanding, day laborers providing identical services for homeowners
may be treated differently depending on the knowledge level of WHD
officials. Furthermore, with respect to OSHA, in the absence of
regulations or a centralized source of information that specifies the
responsibilities of temporary staffing agencies for the health and safety
of their workers, OSHA*s local offices may risk inconsistent application
of the OSH Act and joint employers may fail to provide sufficient safety
protections.

To further WHD*s and OSHA*s efforts to obtain better information
concerning the presence of and potential for violations involving day
laborers, we recommend that the Secretary of Labor: Recommendations for

Executive Action

Page 26 GAO- 02- 925 Protections for Day Laborers

 direct WHD and OSHA, as a part of their education and outreach efforts,
to enhance the procedures they use to reach day laborers, such as
expanding their contact with temporary staffing agencies or other agencies
that work with day laborers;

 direct WHD and OSHA to review the results of local efforts to obtain
additional data on the presence and violation experience of day laborers
working for temporary staffing agencies for possible replication in other
locations or agencywide; and

 direct OSHA to finalize its current effort to collect data on fatalities
and catastrophes and refine it by asking first whether someone is a day
laborer, including whether the individual worked for a temporary staffing
agency.

To ensure that Labor*s local offices have consistent policies and an
understanding of how and when to enforce protections afforded under FLSA
and the OSH Act, we recommend that the Secretary of Labor:

 instruct WHD to clarify when day laborers may be covered under the
domestic service provision of FLSA; and

 instruct OSHA to consider the development of regulations to specify
temporary staffing agency responsibility for safety and health under the
OSH Act, or at a minimum, centralize existing information on temporary
staffing agencies* responsibilities.

WHD and OSHA provided us with written comments on a draft of this report,
which are reproduced in appendixes IV and V, respectively. WHD agreed with
all of the recommendations that applied to it. OSHA agreed with our
recommendation regarding enhancing the education and outreach procedures
it uses to reach day laborers and did not object to the others. The
agencies also provided technical comments, as did BLS and Labor*s Office
of Solicitor, which we incorporated in the report where appropriate.

Both WHD and OSHA emphasized their commitment to protecting day laborers
under FLSA and the OSH Act. WHD said that it is strongly committed to
providing effective compliance assistance to those workers covered by
FLSA. OSHA said that employers of day laborers have the same obligations
as any other employer. Nonetheless, OSHA acknowledges that particular
outreach and enforcement efforts may be necessary to address the
particular circumstances of day laborers. Agency Comments

and Our Evaluation

Page 27 GAO- 02- 925 Protections for Day Laborers

Both agencies provided additional information on their outreach efforts.
For example, WHD is developing a plain language fact sheet, in English and
Spanish initially, covering the application of wage and hour laws to the
employment of temporary workers such as day laborers. OSHA has formed an
alliance with the Hispanic Contractors of America to expand outreach and
communication on safety and health awareness and best practices for
Spanish- speaking employers and employees in the construction industry.

WHD and OSHA commented on our assessment of particular procedures
affecting their ability to detect violations involving day laborers. Both
agencies said that off- site investigations, such as telephone and fax
contacts with employers, are the most timely and effective method of
securing last paychecks for workers. They noted that these investigations
can be used as an indicator that an on- site investigation of the employer
might be warranted. We agree that this method may be efficient and have
value for workers who are likely to complain about working conditions;
however, we continue to believe that this method may not be the most
effective for day laborers, who generally may be reluctant to complain.
OSHA also said that its construction targeting, which generally reaches
larger sites, does not preclude OSHA from inspecting sites where day
laborers can be found because small contractors regularly subcontract work
at large construction sites and at many projects valued over $50,000.
However, several experts told us that larger construction contractors with
higher- value projects tend to use unionized subcontractors who rarely
hire nonunion workers, such as the day laborers we encountered.

We are sending copies of this report to appropriate congressional
committees, the Secretary of Labor, and the Assistant Secretaries of Labor
for Employment Standards and Occupational Safety and Health. We will also
make copies available to others upon request. In addition, the report will
be available at no charge on GAO*s Web site at http:// www. gao. gov.

Page 28 GAO- 02- 925 Protections for Day Laborers

Please contact me or Lori Rectanus on (202) 512- 7215 if you or your staff
have any questions about this report. Other contacts and staff
acknowledgments are listed in appendix VI.

Sincerely yours, Robert E. Robertson Director, Education, Workforce, and

Income Security Issues

Appendix I: Identification and Selection of Agencies Serving Day Laborers

Page 29 GAO- 02- 925 Protections for Day Laborers

To determine what is known about the size and nature of the day laborer
workforce in the United States, we initially examined demographic data on
day laborers from the Bureau of Labor Statistics* Current Population
Survey Contingent Work Supplement. Although this information is collected
directly from individuals working as day laborers, it lacked detailed data
about the characteristics of day laborers and their work that were
necessary to address this objective, such as the number of hours or days
worked, means of transportation used to get to job sites, and frequency
and method of payment for work completed. Moreover, data available from
other studies and reports focused on day laborers in certain geographic
locations. As a result, we collected supplemental information through
structured interviews from agencies that work with day laborers.

We identified two types of agencies that assist day laborers. One type
consists of nonprofit and local government agencies that work with day
laborers seeking employment on street corners. The second type includes
temporary staffing agencies that employ day laborers.

Given the lack of a national directory of agencies that work with day
laborers, to identify as many agencies as possible, we interviewed
experts; visited local agencies in the Washington, D. C., metropolitan
area; and reviewed research studies and reports identified by experts, a
literature review, and the Internet. We sought to obtain the broadest
ethnic and geographic representation possible. We found that the majority
of the agencies on our list were Hispanic- based groups, which may have
some effect on our findings regarding the ethnicity of day laborers. We
observed and were told of day laborers of other ethnic backgrounds, such
as Asians in New York, and Polish and other eastern European groups in
Chicago, but few, if any of the organizations on our list focused solely
on serving these groups. We ultimately identified 84 agencies representing
14 states; the overwhelming majority of the agencies (61) were located in
California, with Texas having the next highest number (4).

To identify temporary staffing agencies, we started with a list of 11
firms identified by the American Federation of Labor- Congress of
Industrial Organizations (AFL- CIO) as the primary employers of blue-
collar workers in the United States. The American Staffing Association, an
organization that represents temporary staffing agencies, confirmed that
these were the major employers of skilled and/ or unskilled blue- collar
workers. Appendix I: Identification and Selection of

Agencies Serving Day Laborers Identifying Agencies Serving Day Laborers

Appendix I: Identification and Selection of Agencies Serving Day Laborers

Page 30 GAO- 02- 925 Protections for Day Laborers

To identify nonprofit and local government agencies for our structured
interviews, we chose one agency from each of the 14 states represented on
the list of 84 and added 4 agencies each from California, Illinois, New
York, and Virginia to interview during our site visits. We also added 1
agency each from California and Texas because they represented the largest
number of agencies on our list. In total, we selected 20 nonprofit and
local government agencies and all 11 temporary staffing agencies we
initially identified.

From February to June 2002, we contacted the 31 nonprofit, local
government or temporary staffing agencies (20 nonprofit or local
government and 11 temporary staffing agencies). We asked these agencies
about (1) the characteristics of the day laborer workforce, such as race,
age, and education; (2) types of work day laborers typically perform; (3)
working conditions that day laborers face in the areas of wages, safety,
and health; and (4) litigation concerning federal wage, safety and health
provisions that involved day laborers. We did not independently verify the
information provided by the agencies.

Three of the 20 nonprofit and local government agencies we interviewed
worked with day laborers employed by temporary staffing agencies. We
included their results with the 11 temporary staffing agencies* for a
total of 14. Three temporary staffing agencies declined to participate and
3 others did not employ day laborers as we defined them, leaving a final
total of 8. As a result, the information in this report represents 17
nonprofit and local government agencies and 8 temporary staffing agencies
in which 3 street agencies were re- categorized as temporary staffing
agencies. (See table 3.) Selecting Agencies

Serving Day Laborers Delivery of Structured Interviews

Appendix I: Identification and Selection of Agencies Serving Day Laborers

Page 31 GAO- 02- 925 Protections for Day Laborers

Table 1: Agencies Participating in Structured Interviews Agency name
Location Nonprofit and local government agencies

Coalition for Humane Immigrant Rights of Los Angeles California San Diego
County Jobs for Progress California San Francisco Day Laborer Program
California American Friends Service Committee Colorado Roswell
Intercultural Alliance Georgia Latin Union of Chicago Illinois CASA of
Maryland Maryland Wind of the Spirit Immigrant Resource Center New Jersey
Latin American Workers Project New York Workplace Project New York
Association of Latino Workers of North Carolina North

Carolina VOZ: Workers* Rights Education Project Oregon Denton Humanitarian
Association Texas Oscar Romero Workers* Center Texas Culmore Family
Resource Center Virginia Shirlington Employment and Education Center
Virginia CASA Latina Washington

Temporary staffing agencies

Adecco a Chicago Coalition for the Homeless b Illinois Day Laborers*
Organizing Committee b Ohio Labor Connection a Labor Finders International
a Labor Ready a Primavera Works b Arizona Tandem Staffing Solutions a a
These temporary staffing agencies have offices in locations nationwide or
in certain regions of the United States. b The responses we received from
these agencies related to day laborers working for temporary

staffing agencies. Source: GAO.

Appendix II: Services Provided to Day Laborers by Selected Nonprofit
Agencies

Page 32 GAO- 02- 925 Protections for Day Laborers

As part of our efforts to identify what was known about the nature and
size of the day laborer workforce, we conducted on- site visits with one
nonprofit agency that works with day laborers in each of the four states
we visited. During these visits, we obtained information on the
characteristics of the day laborer workforce, as well as how these
agencies broker employment for day laborers and work to improve day
laborers* working conditions.

The four nonprofit agencies we visited seek to improve the welfare of a
population broader than day laborers, to include low- income workers, the
homeless, and local citizens. All of the agencies provide information to
workers to educate them about their rights in the workplace. They also
help day laborers obtain employment and provide them with a range of
social services, from teaching English and offering classes on childcare
to providing medical screenings. At one of the locations of the Coalition
for Humane Immigration Rights of Los Angeles (CHIRLA), day laborers can
receive English classes from a local welfare agency representative while
they wait to be assigned to a job. In some cases, these services are
offered to workers who stay at the site after it closes. (See table 2 for
a description of these agencies and the services they provide to day
laborers.) In addition, the agencies provide legal support by referring
workers for legal assistance or litigating cases themselves on behalf of
workers.

Table 2: Description of Agencies GAO Visited and the Services They Provide
Agency/ location Purpose Services provided to day laborers

Shirlington Employment and Education Center, Arlington, Va. Provides
employment and training

services to individuals in the community.

 Provides services, such as classes in English and computers.

 Brokers employment. Coalition for Humane Immigration Rights of Los
Angeles, Los Angeles, Calif. Organizes workers and provides social

services to improve the overall welfare of low- income workers.

 Provides services, such as English and literacy classes.

 Litigates cases.

 Brokers employment. Chicago Coalition for the Homeless, Chicago, Ill.
Seeks to empower homeless individuals.  Organizes day laborers to address

grievances. Latin American Workers* Project, New York, N. Y. Provides
outreach and education to

workers to help them organize.

 Offers English classes.

 Litigates cases.

 Brokers employment. Source: Shirlington Employment and Education Center,
Coalition for Humane Immigration Rights of Los Angeles, Chicago Coalition
for the Homeless, and Latin American Workers* Project.

Appendix II: Services Provided to Day Laborers by Selected Nonprofit
Agencies

Description of Nonprofit Agencies Visited

Appendix II: Services Provided to Day Laborers by Selected Nonprofit
Agencies

Page 33 GAO- 02- 925 Protections for Day Laborers

Several of these agencies began to serve day laborers because local
communities were increasingly displeased at seeing day laborers
congregating on street corners or at convenience or home warehouse stores.
1 Local citizens reported that they feared for their safety or they feared
that congregating could affect local commerce. Advocates for day laborers
feared for the safety and welfare of day laborers* either they were being
injured as a result of running into traffic to respond to employers*
solicitations for work or they were complaining about not receiving
promised wages or adequate working conditions. Local groups* including
social welfare agencies, worker advocates, local government, and police*
often worked together to develop and fund solutions to connect day
laborers and employers.

Toward that end, three of the four organizations worked with local groups
to build or identify locations that could be used to broker employment
between day laborers and employers. (Chicago*s Coalition for the Homeless
does not broker employment.) The Shirlington Center has a building where
day laborers wait for work. The Latin American Workers* Project operates
two sites in New York: one in the basement of a church and the other on a
parking lot along the banks of the Atlantic Ocean. A tent was recently
donated to the latter site to provide shelter. CHIRLA operates three sites
around the Los Angeles area that are also located in parking lots. 2 The
agencies publicize these new locations to employers and encourage them to
use these sites to find workers. In one location, police will ticket
employers or day laborers who use street corners. However, some day
laborers refuse to use these sites, believing that their employment
opportunities are better at unorganized sites. It is hard to reach all day
laborers and unorganized sites continue to exist. For example, New York
officials identified 26 unorganized sites around New York City, while
CHIRLA representatives identified about 150 unorganized sites in Los
Angeles County.

The agencies established procedures at these job sites to facilitate the
brokering of employment. These procedures were often developed with the
input of day laborers and typically require that they provide basic

1 Representatives from all of these agencies said that many local
communities continue to make efforts to pass anti- loitering ordinances in
an effort to prevent day laborers from gathering at street corners. In at
least three states* Virginia, California, and Illinois* those ordinances
or efforts have been struck down by the courts.

2 CHIRLA provides mediation and other services for six unorganized
corners.

Appendix II: Services Provided to Day Laborers by Selected Nonprofit
Agencies

Page 34 GAO- 02- 925 Protections for Day Laborers

information, such as their name, address, and telephone number and abide
by certain rules. For example, day laborers at one agency must do some
community work to *pay off* the services provided by the agency. At two
agencies, employers who participate must also provide information,
including their name, address, telephone number, and license plate number.
One agency, however, does not request such information, fearing that those
requirements may scare away employers.

When the day laborers arrive at the site around 6 a. m., they sign in,
listing their name, skills, and level of English proficiency. When
employers arrive seeking a worker for a particular job, a representative
of the agency will select a worker*s name from the list or pick a name
through a lottery system. Employers may request certain workers, for
example, one that has a certain skill or speaks English. The agencies let
the day laborers negotiate wages with employers. However, one agency
established a certain minimum wage that employers must pay. At several
sites, the day laborers have informally agreed among themselves on a
minimum hourly wage and will not go below it.

All the agencies help day laborers remedy workplace problems involving
wages or safety and health. To resolve the problem, they first contact the
employer directly. In some cases, it works well; but in other cases, some
day laborers do not have information about the employer, such as a
telephone number or address, making it difficult to pursue. To address
this problem, CHIRLA and the Latin American Workers* Project have begun to
provide books and cards to the day laborers where they can track the hours
they work, the locations where they have worked (to help assert individual
coverage under FLSA), and other information that will help identify the
employer.

If the problem is not resolved by dealing directly with the employer, the
agencies may conduct a community action to push the employer to resolve
the issue. For example, one agency organized a protest in front of the
employer*s premises. Other strategies include picketing the employer*s
work or home and seeking media attention. The agencies also help workers
file complaints with state or federal agencies, or in small claims court.
However, the agencies reported that most workers are reluctant to do so.

If the problem persists, the agencies may litigate cases on behalf of day
laborers (to recover unpaid wages or obtain workers* compensation for a
work- related injury, for instance), provide legal advice, or refer cases
to Resolving Potential

Violations Involving Day Laborers

Appendix II: Services Provided to Day Laborers by Selected Nonprofit
Agencies

Page 35 GAO- 02- 925 Protections for Day Laborers

local or state legal agencies for litigation. All four agencies partner
with private law firms or local, state, or federal agencies that can also
litigate cases. The Latin American Workers* Project, for example, refers
cases to the Puerto Rican Legal Defense Fund or the New York State
Attorney General.

As a result of these efforts, these four agencies reported that,
collectively, they retrieved over $280,000 in wages owed to workers in
2001. In addition, two agencies reported a significant reduction in the
number of complaints regarding wages, safety, and health.

Appendix III: Selected Features of FLSA and Requirements in Four States

Page 36 GAO- 02- 925 Protections for Day Laborers

This table compares selected features of FLSA with state wage laws,
regulations, and administrative orders in the 4 states we visited. It
highlights only those provisions that are most applicable to day laborers.
State requirements play an important role in supplementing FLSA*s
protections because states may enact more stringent provisions. This means
that a state could cover employers and individuals not covered under FLSA.
If an employer is covered under FLSA and a state requirement, the more
stringent provision will generally apply. We supplemented this table with
information provided by state officials.

Provisions FLSA California Illinois New York Virginia

General coverage All individuals employed by

 employers earning $500,000+ annually in sales, and employees engaged in
interstate commerce, or in the production of goods for commerce;

 employers earning less than $500,000 and individual is engaged in
interstate commerce, or in the production of goods for commerce, or
closely related and directly essential to interstate commerce; or

 homeowners performing domestic services, such as house cleaning or
gardening for 8+ hours a week or earning at least $1,300 in 2002.

Individuals employed by an employer, including homeowner, with certain
exceptions.

Individuals employed by an employer, with certain exceptions.

Individuals employed by an employer, including homeowners, with certain
exceptions.

Individuals employed by an employer, with certain exceptions.

Exclusions most relevant to day laborers

Individuals working for companies earning less than $500,000 and employees
are not engaged in interstate commerce.

None Workers

 employed by employers with fewer than four employees or

 employed by a homeowner performing domestic service in a private home.

None Workers

 employed by employers with fewer than four employees;

 employed by a homeowner performing domestic service in a private home;
or

 covered by FLSA.

Appendix III: Selected Features of FLSA and Requirements in Four States

Appendix III: Selected Features of FLSA and Requirements in Four States

Page 37 GAO- 02- 925 Protections for Day Laborers

Provisions FLSA California Illinois New York Virginia

Wages Minimum wage: $5.15/ hour. Established rate

of pay but no lower than $6.75/ hour.

Established rate of pay but no lower than $5.15/ hour.

Established rate of pay but no lower than $5.15/ hour.

Established rate of pay but no lower than $5.15/ hour.

Overtime For over 40 hours in any workweek, workers earn 1-  1/2 times the
regular rate of pay.

Same as federal law.

Daily overtime: workers earn 1- 1/2 times the regular rate of pay for
every hour worked over 8 hours in 1 day and double the regular rate every
hour worked after 12 hours in 1 day.

Same as federal law. Same as federal law. None Deductions most relevant to
day laborers

Can deduct items considered to be an employee benefit, even if it brings
workers below the minimum wage, such as meals, lodging; must be at the
actual cost.

Can deduct for check cashing or transportation if the services are
voluntary and considered to be an employee benefit.

Can deduct items considered to be for an employer*s benefit, such as
transportation and uniforms, but deductions cannot bring wages below the
minimum.

Employees must provide written authorization for deductions.

Can deduct items that take workers below the minimum wage, such as meals,
but the law sets a cap.

Cannot deduct for personal protective equipment. Employers must provide
itemized statement of deductions at time of payment.

Can deduct the reasonable cost of meals and lodging, if it is for the
employee*s benefit, even if it brings workers below the minimum wage.

Can deduct for transportation, but not if it brings wages below the
minimum.

Can deduct the reasonable cost of uniforms and equipment with employee*s
written consent, but not if it brings wages below the minimum.

Employers must provide itemized statement of deductions at time of
payment.

Can deduct charges for items considered an employee benefit, such as meals
and lodging, even if it brings worker below the minimum wage; the state
sets caps for these items. a

Allowances for uniforms are added to not deducted from wages.

Cannot deduct charges for transportation or personal protective equipment.
Employers must provide itemized statement of deductions at time of
payment.

No deductions allowed without written and signed employee authorization.

Requires written statement of deductions upon request.

Appendix III: Selected Features of FLSA and Requirements in Four States

Page 38 GAO- 02- 925 Protections for Day Laborers

Provisions FLSA California Illinois New York Virginia

Recordkeeping Employers must keep payroll records.

Only courts may assess a penalty for failure to keep payroll records.

Employers, including homeowners, must keep payroll records.

Penalty of $500 for failure to keep payroll records.

Employers must keep payroll records.

State enforcement agency currently not authorized to assess penalties for
failure to keep records. b

Employers, including homeowners, must keep payroll records.

Penalty for failure to keep payroll records is up to $1,000 for a first
violation, $1,000-$ 2, 000 for a second violation, and $2, 000-$ 3,000 for
a third violation.

None Other The Day Labor

Services Act (DLSA) provides additional protections to day laborers
employed by temporary staffing agencies. c Check cashing fees are
prohibited, transportation fees are capped at 3% of daily wages, and other
deductions, such as meals, uniforms, and equipment, must be at the actual
cost or market value.

DLSA also recommends that temporary staffing agencies hire people who
speak languages that are generally used near day labor service agencies. a
New York State law uses the term *allowances* to denote charges for items
such as meals and

lodging. For this table, however, we refer to these allowances as
*deductions.* b According to state Labor officials, new legislation
authorizing the state agency to assess penalties

will take effect in 2003. c Although the act only covers *day labor
service agencies,* for this table, we are referring to them as

temporary. Source: GAO comparison of the Fair Labor Standards Act of 1938,
with the pertinent state laws, requlations, and administrative orders of
California, Illinois, New York and Virginia.

Appendix IV: Comments from the Employment Standards Administration Page 39
GAO- 02- 925 Protections for Day Laborers

Appendix IV: Comments from the Employment Standards Administration

Note: GAO comments supplementing those in the report text appear at the
end of this appendix.

See comment 2. See comment 1.

Appendix IV: Comments from the Employment Standards Administration Page 40
GAO- 02- 925 Protections for Day Laborers

See comment 3. See comment 3.

Appendix IV: Comments from the Employment Standards Administration Page 41
GAO- 02- 925 Protections for Day Laborers

Appendix IV: Comments from the Employment Standards Administration Page 42
GAO- 02- 925 Protections for Day Laborers

1. We clarified the paragraph that discusses WHD*s Spanish- speaking staff
to indicate that WHD has about one- quarter of its staff that speak
Spanish.

2. See discussion in Agency Comments section of report. 3. We modified the
report*s language as suggested. GAO Comments

Appendix V: Comments from the Occupational Safety and Health
Administration Page 43 GAO- 02- 925 Protections for Day Laborers

Appendix V: Comments from the Occupational Safety and Health
Administration

Note: GAO comments supplementing those in the report text appear at the
end of this appendix.

Appendix V: Comments from the Occupational Safety and Health
Administration Page 44 GAO- 02- 925 Protections for Day Laborers

Appendix V: Comments from the Occupational Safety and Health
Administration Page 45 GAO- 02- 925 Protections for Day Laborers

See comment 1.

Appendix V: Comments from the Occupational Safety and Health
Administration Page 46 GAO- 02- 925 Protections for Day Laborers

See comment 1. See comment 2.

Appendix V: Comments from the Occupational Safety and Health
Administration

Page 47 GAO- 02- 925 Protections for Day Laborers

1. See discussion in Agency Comments section of report. 2. We do not
disagree with the number of investigations that OSHA*s

cites in its comments. The data OSHA cites in support of increasing number
of investigations include those conducted by telephone and fax. As a
result, these numbers do not necessarily indicate increases in worksite
visits. GAO Comments

Appendix VI: GAO Contacts and Staff Acknowledgments

Page 48 GAO- 02- 925 Protections for Day Laborers

Lori Rectanus, (202) 512- 9847 Monika Gomez, (202) 512- 9062

Ronni Schwartz made significant contributions to this report, in all
aspects of the work throughout the review. In addition, Lisa Lim and Torey
Silloway assisted in gathering and analyzing information collected on our
site visits; H. Brandon Haller helped develop our data collection
instrument and our overall design and methodology; Julian Klazkin provided
legal support; and Patrick DiBattista assisted in report and message
development. Appendix VI: GAO Contacts and Staff

Acknowledgments GAO Contacts Staff Acknowledgments

(130095)

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