Weak laws, an understaffed state watchdog agency, and thousands of workers still due money they say they are owed.
Those are the findings of a KARE 11 investigation into wage theft in Minnesota.
State officials acknowledge their hands are often tied when it comes to forcing employers to cough up unpaid wages.
“If you rob a bank of a thousand dollars, you go to prison. If you rob your employees of a thousand dollars, you go to Costco and go shopping,” State Representative Tim Mahoney (DFL District 67A) told KARE 11.
Final Paycheck Never Delivered
Curt Clochie’s story illustrates the problem.
What started out as a long-awaited Las Vegas vacation for Clochie and his wife Amy, turned into an embarrassing hassle of debit card denials.
“The last week of our trip my payroll check did not show up,” recalls Curt, an automotive and marine upholsterer who expected his check to be auto deposited as normal.
He texted his boss, Steve Cossette, the owner of Aero Upholstery in Medina. “He claimed he was waiting to get paid on a job,” said Curt while showing KARE 11 Investigative Reporter A.J. Lagoe the text message exchange saved on his phone.
A few days later, right before he planned to return to work, Curt was terminated with no notice.
“Minnesota is an at-will state,” he said, shrugging his shoulders, “So it is what it is.”
But Curt still expected to be paid for his last week of work and earned vacation.
Minnesota law says when employees are discharged their unpaid wages are due immediately.
However, Curt says when he asked for his last paycheck, and to be allowed to collect some personal property he’d left at work, he got quite the surprise.
Curt recorded the last phone conversation he had with his former boss Steve Cossette:
Curt Clochie: “I’m trying to avoid both of us having to go to court.”
Steve Cossette: “Yeah, you can come pay me $1,500 and get your seat out of here and we’re done.”
Curt Clochie: “What’s the $1,500 for?”
Steve Cossette: “Combination of things.”
The conversation goes back and forth like this for several minutes. Instead of giving Curt his paycheck, Cossette demanded his employee pay him and would not tell him why.
Curt Clochie: “What am I giving you $1,500 for, or what do you want me to give you $1,500 for?”
Steve Cossette: “For a combination of things.”
Curt Clochie: “Well explain that to me.”
Steve Cossette: “I don’t need to! Goodbye,” he said while hanging up the phone.
Watchdog Without Teeth
After failing to resolve the issue with his former employer, Curt Clochie turned to the Minnesota Department of Labor and Industry and filed a wage claim against Cossette and Aero Upholstery.
Records show a state investigator mailed a letter to Cossette at Aero, but got no response.
When the investigator called, records show Cossette stated he would not be responding to the wage claim and hung up.
Instead of investigating further, or issuing an order to pay the wages, the Dept. of Labor and Industry gave up and closed Curt’s wage claim.
The state mailed him a letter saying if he wanted, he could file a lawsuit in small claims court on his own.
“Done, that’s it,” a frustrated Curt said as he threw his hands in the air.
“Yup, case closed,” his wife Amy responded as the couple discussed the case. “They basically just said there’s nothing more we can do.”
The Clochie’s case comes as no surprise to Rep. Mahoney. He has been attempting to toughen Minnesota’s wage theft laws.
“It’s just really stacked against employees and towards the employer if he or she wants to be a bad actor,” Mahoney told KARE 11.
Minnesota Dept. of Labor and Industry Commissioner Ken Peterson agrees the current state law is weak.
“The fact is he’s right, in that there are no real penalties, real criminal penalties for robbing your employee,” Peterson said.
Peterson says his office can issue an order for payment and take an employer to an administrative hearing. But to handle the 15,000 wage theft claims, impacting about 39,000 workers each year, he has just five investigators. It’s impossible, he says, to follow through on every case.
“They can’t!” exclaimed Peterson. “We do the best job we can.”
Peterson tells KARE 11 his department focuses on the big claims involving multiple employees or a pattern of abuses. He says cases like Curt Clochie’s are just dropped if the employer refuses to cooperate.
“They’re on their own?” asked Lagoe.
“They’re on their own,” replied Peterson. “That’s basically it, they’re on their own.”
The issue of wage theft has led to spirited rallies at the state capitol.
Last session, Rep. Mahoney introduced a bill he said would give Labor Investigators added authority to crack down on problem employers and stiffen penalties for non-compliance.
“For the bad actors, we should have teeth in our law so that we can go after them and we can help the employee get paid the money that they’re owed,” Mahoney said.
However, his bill became a political football in the showdown between GOP lawmakers and DFL Governor Mark Dayton and ultimately failed to pass.
“It’s like where, where is our help?” Amy Clochie asked. She contacted KARE 11, asking us to investigate her husband’s case.
When KARE 11 emailed Steve Cossette at Aero Upholstery asking to do an interview, we got no response.
When we called Cossette, he hung up the phone, refusing to discuss why he failed to pay his former employee.
When we visited the business, Cossette locked the doors and refused to come outside.
Curt and Amy Clochie are left with no easy answers. They can file a lawsuit in small claims court, but even if they win they are concerned it will end up costing more than they are owed.
They say they hope that by sharing their story, state lawmakers will finally show the political will to set partisan differences aside and take action to protect Minnesota workers from wage theft.
“It should be stopped somehow!” Curt said, slapping his dining room table. “It’s just not right, it’s wrong. it’s just wrong.”
Rep. Mahoney says he plans to re-introduce his wage theft legislation next session.
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