LITTLE ROCK — When the Fayetteville radio station where Marta Sandoval worked for two years failed to pay her more than $5,000 in wages she was owed, the Rogers resident was left in a difficult spot.
"I couldn’t pay the college tuition for my daughter (for) a year and I almost lost my home," Sandoval told the House and Senate subcommittees on labor and the environment Thursday.
The panel is considering proposed civil penalties for employers who illegally withhold wages.
Sandoval said she eventually received about 78 percent of what she was owed, after a lengthy dispute.
"It is terrible that it takes so long to resolve those kinds of problems. I don’t understand anything about the law, but I think I deserve to get paid," she said.
The subcommittees of the House and Senate committees on public health, welfare and labor are conducting an interim study on a draft bill by Rep. Greg Leding, D-Fayetteville, aimed at cracking down on what Leding called "wage theft."
Under the bill, an employer would be required to pay all wages owed to a worker who leaves employment and would have to do so no later than the regularly scheduled payday of the last pay period worked. An employer who violated the law would be liable for a civil penalty of $100 or the full amount owed to the employee, whichever is greater.
Daniel Faulkner, a lawyer with the state Labor Department, testified that his office did not initiate the bill but does support it.
‘The hope is the penalty provided for in the statute will encourage those folks who are on the fence to go ahead and pay that final paycheck by the next regular payday," Faulkner said.
Imposing civil penalties also would allow the workers to receive much-needed cash to tide them over while they fight to recover the pay they are owed, Faulkner said.
"These are employees that, one (missed) paycheck throws everything into disorder," he said. "You know, the light bill’s not paid, they can’t pay their rent. Things just go haywire."
Although Leding’s proposal addresses only the practice of withholding ex-employees’ final paychecks, witnesses also testified about other forms of wage theft, such as failing to pay workers all of the overtime they are owed or paying them less than minimum wage.
Jose and Ana Aguayo of the Northwest Arkansas Workers Justice Center in Springdale testified that in many cases employers pay workers less than their full wages for months at a time.
"They are held with the promise that, ‘The business is not doing so good at the moment. I’m going to pay you partially what you’re owed, but wait for me next week or the next paycheck and I will compensate everything fully.’ That is the empty promise we are seeking to fight," Ana Aguayo said.
Several lawmakers said they found the practice appalling.
‘This is modern-day slavery," said Rep. Garry Smith, D-Camden.
Sen. Randy Laverty, D-Jasper, Senate chairman of the panel, said he knew the practice existed but he also was concerned about not placing a burden on law-abiding employers.
"Most of our employers are good, fair, honest people," he said. "They don’t want to cheat folks. So how do we regulate this? Our whole system is based on not penalizing the innocent."
Leding was unable to win support for a similar bill he filed during the 2011 legislative session. He said his new proposal would not create a new level of bureaucracy and would not punish good employers — in fact, he said, it should benefit them by leveling the playing field.
"A good employer should not be held at a disadvantage by a competitor who willingly fails to pay wages that have been earned," Leding said.