An unguarded, cracked bench grinder in a California warehouse recently took the life of a young worker. Several weeks later a Cal/OSHA inspection coordinated by the Labor Enforcement Task Force (LETF), a newly formed state task force, found the same hazard at another worksite and ordered it to be immediately corrected—potentially preventing a second tragedy.
The LETF is a recent initiative spearheaded by the California Department of Industrial Relations (DIR) to protect workers and law-abiding businesses from substandard working conditions. The multi-agency task force includes DIR’s Cal/OSHA and Division of Labor Standards Enforcement, the Department of Insurance, Contractors State Licensing Board, Employment Development Department, Franchise Tax Board, and more (see full list below).
State Fund recently joined the LETF as part of our effort to fight the “underground economy”. The underground economy is unlawful business activity done “off the books” to avoid providing workers’ compensation insurance coverage, paying taxes and complying with basic safety requirements that protect workers.
When unscrupulous businesses use these tactics to cut their costs, the money they save places the owners of compliant businesses at a critical disadvantage—especially in this time of unprecedented economic stress. So it should come as no surprise that California business leaders are among the most vocal proponents of leveling the playing field. LETF is listening and targeting the underground economy for enforcement operations.
To accomplish this goal LETF is coordinating boots-on-the-ground inspections by Cal/OSHA and other participating enforcement agencies, which can be initiated by complaints or “red flag” data indicating a high likelihood of illegal activity. One common red flag is an employer reporting low payroll on construction projects too big to be carried out without large numbers of workers. The main focus is on precise, focused enforcement activity designed to find the most flagrant violators of the law.
Earlier this summer, with information supplied by State Fund, an eleven-county sweep resulted in enforcement actions against businesses failing to carry workers' comp insurance, under-reporting worker numbers to obtain cheaper insurance premiums and pay less payroll tax, and cash payments to hide unregulated practices.
During the first half of 2012, nearly 1,700 inspections, conducted primarily in the agriculture, automotive, construction, garment production, and restaurant industries, resulted in more than $3.3 million dollars in initially assessed fines and nearly a half million dollars in returned wages. Failing to provide workers’ compensation insurance coverage alone resulted in more than $1 million in fines assessed and 147 Stop Work Orders issued.
State Fund’s participation in LETF aligns with our Chief for Workplace Safety Len Welsh’s focus on finding the most effective approaches to improving workplace safety and health.
“The most effective enforcement comes from targeted team effort,” says Welsh. “If the agencies and organizations involved in enforcement, education, and compliance assistance can strategically share essential information, maximize coordination of our operations, and maintain clear focus on eliminating the most severe violations out there, we will see historic improvements not only in workplace safety and health, but in California's business climate itself.”
Welsh adds that messaging and publicity will be key components of the task force and thinks State Fund will be especially helpful in shining a light on the underground economy. Finding effective and creative ways to provide information and support to businesses who want to comply with the law will be a major focus.
More information on the Labor Enforcement Task Force can be found on the DIR Web site.
Labor Enforcement Task Force