Cracking down on wage theft

When a large company contracts out jobs to smaller ones, who then hire workers as “independent contractors,” is the large company liable when the workers aren’t paid what they’re owed? It’s a tricky question that depends partly on how much control the large company exerts over what the workers do. It’s also an issue that’s leading to major litigation, including a recent lawsuit by New York State against Domino’s Pizza (which allegedly encouraged its franchisees to use payroll software that undercounted workers’ hours), and a $240 million settlement by Fed Ex in a nationwide class action on behalf of 12,000 underpaid drivers.

This spring, three Sheller Center students – Crystal Felix, Paige Joki and Daniella Lees — confronted a local version of the problem. Working with attorney Marielle Macher of the Community Justice Project, the students filed suit in federal court against a company that initially argued that it had no responsibility for wage theft by its subcontractors.

Ms. Felix notes that “seeing how prevalent wage theft is in Philadelphia is just mind-blowing.” And so, besides handling the case, she worked with Community Legal Services on the implementation of Philly’s recently-enacted wage theft ordinance.  More on that soon!