Tech Firm Fined For Paying Imported Workers $1.21 Per Hour

An anonymous reader sends in news about a company that was fined for flying in "about eight employees" from India to work 120-hour weeks for $1.21 per hour. Electronics for Imaging paid several employees from India as little as $1.21 an hour to help install computer systems at the company's Fremont headquarters, federal labor officials said Wednesday. "We are not going to tolerate this kind of behavior from employers," said Susana Blanco, district director of the U.S. Labor Department's wage and hour division in San Francisco.... An anonymous tip prompted the U.S. Department of Labor to investigate the case, which resulted in more than $40,000 in back wages paid to the eight employees and a fine of $3,500 for Electronics for Imaging.

Comments

$3500 fine?

[msobkow]

That's a joke. They should have been fined at least as much as the backwages were.

Re:$3500 fine?

[Anonymous Coward]

Yes yes prices may go up, but as minimum wage advocates say, if you have to pay people more, they have more to spend.

A more sensible argument in favour of minimum wage is that if there isn't one, government assistance to low income earners are in practice a subsidy to companies that then don't have to pay a living wage.

Re:$3500 fine?

[Macman408]

It's not clear to me that it was willful avoidance of paying minimum wage - they had a job to do, they got help from some of their existing employees from overseas, who continued to receive their regular wage (in their regular currency) during the time that they were here. So the company paid the back wages to the employees, and a small fine to the government. Doesn't seem unreasonable to give them a little slap on the wrist; save the big punishments for when there are repeated offenses, or more wanton abuse.

I'm more curious what the legal requirement is for paying the local minimum wage instead of a worker's regular salary, when they are working away from their normal office. I certainly wouldn't want to be paid in rupees if I had to travel to an office in India. But if I were there under the same conditions as those workers were here, would there be any violation of US Labor Laws if they paid me the local wage while I was over there? On the other hand, if I go to a college recruiting event in San Francisco for an afternoon, am I entitled to an increased minimum wage of $10.74 for a few hours? What if I'm a driver, paid by the mile, going through different jurisdictions each with their own minimum wage law?

Re:$3500 fine?

[worldthinker]

Automation of jobs even professional level jobs such as medical or legal is inevitable. The long term prospect is that humans will be superfluous to work. Therefore, our society needs to rethink the purpose of an economy and evolve.

Perhaps ideas like a Universal Basic Income become relevant in a future society devoid of meaningful work.

Perhaps automation makes economic scarcity of essential needs a thing of the past.

Perhaps people become free to seek their own happiness instead of toiling for sustenance.

But that would be monstrously scary to objectivist who might think that society must exploit and privatize everything.

Re:$3500 fine?

[Anonymous Coward]

Fuck the Objectivists. Their alleged philosophy is rejected by all but a tiny minority of serious academic thinkers as incomplete, idiotic, and unworkable in the real world.

Hell, even Greenspan, who sat at the feet of the weird Ayn Rand, was forced to admit in front of congress that his philosophy doesn't work in the real world, and that was the end of any intellectual underpinnings for the whole anti-regulation, anti-humane, anti-altruism, tax-cuts-for-the-rich, trickle down crap.

I repeat: Fuck the Objectivists and their amoral "Devil take the hindmost" attitudes.

So it was worth it for the employer.

[random coward]

Assuming they get caught half the time this is a huge cost savings and they continue.

What 3500$?

[140Mandak262Jamuna]

3500$ per hour of stolen wages? per week? per employee? what the hell is wrong with our system? This is a slap in the wrist, and a clear permission to employers to violate all labor standards. They CEO's lunch tab could be more than this...

See, they don't need H1-B visas...

[Anonymous Coward]

They can just do this and then they save millions in labor costs and healthcare...

Maybe we should actually penalize companies

[dirk]

The reason companies keep doing this stuff is that they have deemed it cost effective. Let's assume they get caught 90% of the time. That means that would have to pay $31500 in fines for the 9 times they were caught and would save $40000 for the time they didn't. They are coming out ahead so the fine are just a cost of doing business. These tiny little fines are not going to stop things like this from happening. At minimum, the fine should be the same amount they would have "saved"(preferably more). At best, we should start putting people in jail for breaking the law just like we do regular people who break the law.

$3500 fine?

[Anonymous Coward]

What do you expect, they have been doing this for over a decade with illegals.

No one has the balls to go after the companies that make use of slave day labor.

If you started fining companys every month a good chunk of money 5-10 grand, graduating 15,20,40 60 for frequent abusers things would change quick.

Yes yes prices may go up, but as minimum wage advocates say, if you have to pay people more, they have more to spend.

Increase fine and throw executives in jail

[techdolphin]

I would make the fine at least triple the back wages owed, 120,000 plus the back wages. We should also throw the executives in jail. If anybody stole $40,000 they would face serious jail time. I do not see this as being different from stealing.

IBM tries to do this too

[magarity]

When I lived in China between '07-'09 I interviewed at the local IBM office to do data warehouse ETL. They wanted to pay me a local wage around $1000/month but send me to the US on an 'L' visa whereby they wouldn't be subject to US wage laws which the manager said "we do it all the time". When I pointed out they couldn't send me to the US on any kind of visa since I'm a citizen, they dropped all contact.

Re:IBM tries to do this too

[AK Marc]

You should have just said yes, and see if you could get something in writing from them. Having that would have earned you more than the job would have paid, and made interesting reading for us.

Seems ridiculous to me

[amyckono]

It's amazing that $1.21/hr is all that stands between an employment dispute and human slave trafficking. The company and involved employees should be punished much more severely, imho.

As I think has already been pointed out

[rsilvergun]

in other parts of the thread, if you don't fine someone several times the profit made from the illegal activity and you don't put them in jail then they will continue to do the activity. I doubt they lost money on the deal, so why stop?

Also, the damage wasn't limited to the employees. Everyone in tech (which is most of /.) lost wages when the prevailing wage for tech workers was depressed as a result of this behavior.

Re:Really?

[Anonymous Coward]

The USA was founded to be a government of the people, by the people, and for the people - that is, ordinary people. At the time, Europe was governed by a small hereditary ruling class living out lives of frivolous luxury by exploiting everyone else. The founders of the USA wanted something different.

Their goal was not to create a a country where ordinary people were fully employed producing luxury goods for the hereditary ruling class - spurred on by the faint hope that once in a blue moon an ordinary "Cinderella", with the right physical proportions, would be able to become a member of the hereditary ruling class. Their goal was a country where ordinary people could live secure comfortable lives free of exploitation and oppression by a hereditary ruling class.

I've been to countries without an effective social safety net or minimum wage. And, yes, unemployment is lower: you'll see little a girl standing out in the middle of a busy intersection beating a broken drum hoping that a few drivers will pay her for her performance a coin or two so she won't have to go to bed hungry yet again. In a certain sense, a triumph of capitalism - even the young children are employed providing entertainment for the upper class.

Full employment isn't the point. Yes, there's a lot of work that needs doing - and despite their claims of greatness the rich simply aren't capable of doing it all - ordinary people do need jobs. The point is that ordinary people need good jobs - jobs that pay enough to live securely and comfortably. And to the extent that such jobs are not available to everyone who needs one then there's needs to be a strong social safety net.