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Corps Cheat Workers out of Pay

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  • Dan Clore
    News & Views for Anarchists & Activists: http://groups.yahoo.com/group/smygo Tri-Valley Herald Shaving time off payrolls widespread practice Falsifying
    Message 1 of 1 , Apr 5, 2004
      News & Views for Anarchists & Activists:
      http://groups.yahoo.com/group/smygo

      Tri-Valley Herald
      Shaving time off payrolls widespread practice
      Falsifying workers' hours held to be common management trick
      to pare down expenses
      By Steven Greenhouse
      New York Times

      Sunday, April 04, 2004 -- As a former member of the Air
      Force military police, as a play-by-the-rules guy, Drew
      Pooters said he was stunned by what he found his manager
      doing in the Toys "R" Us store in Albuquerque, N.M.

      Inside a cramped office, he said, his manager was sitting at
      a computer and altering workers' time records -- secretly
      deleting hours to cut their paychecks and fatten his store's
      bottom line.

      "I told him, 'That's not exactly legal,'" said Pooters, who
      ran the store's electronics department. "Then he out and out
      threatened me not to talk about what I saw."

      Pooters quit, landing a job in 2002 managing a Family Dollar
      store, one of 5,100 in that discount chain. Top managers
      there ordered him not to let employees' total hours exceed a
      certain amount each week, and one day, he said, his district
      manager told him to use a trick to cut payroll: delete some
      employee hours electronically.

      "I told her, 'I'm not going to get involved in this,'"
      Pooters recalled, saying that when he refused, the district
      manager erased the hours herself.

      Experts on compensation say that the illegal doctoring of
      hourly employees' time records is far more prevalent than
      most Americans believe. The practice, commonly called
      shaving time, is easily done and hard to detect -- a simple
      matter of computer keystrokes -- and has spurred a growing
      number of lawsuits and settlements against a wide range of
      businesses.

      Workers have sued Family Dollar and Pep Boys, the auto parts
      and repair chain, accusing managers of deleting hours. A
      jury found that Taco Bell managers in Oregon had routinely
      erased workers' time. More than a dozen former Wal-Mart
      employees said in interviews and depositions that managers
      had altered time records to shortchange employees. The
      Department of Labor recently reached two back-pay
      settlements with Kinko's, totaling $56,600, after finding
      that managers in Ithaca, N.Y., and Hyannis, Mass., had
      erased time for 13 employees.

      "There are a lot of incentives for store managers to cut
      costs in illegal ways," said David Lewin, a professor of
      management who teaches a course on compensation at the
      University of California, Los Angeles. "You hope that would
      be contrary to company practices, but sometimes these
      practices become so ingrained that they become the dominant
      practice."

      Officials at Toys "R" Us, Family Dollar, Pep Boys, Wal-Mart
      and Taco Bell say they prohibit manipulation of time
      records, but many acknowledge that it sometimes happens.

      "Our policy is to pay hourly associates for every minute
      they work," said Mona Williams, vice president for
      communications at Wal-Mart. "With a company this large,
      there will inevitably be instances of managers doing the
      wrong thing. Our policy is if a manager deliberately deletes
      time, they're dismissed."

      Compensation experts say that many managers, whether at
      discount stores or fast-food restaurants, fear losing their
      jobs if they fail to keep costs down.

      "A lot of this is that district managers might fire you as
      soon as look at you," said William Rutzick, a lawyer who
      reached a $1.5 million settlement with Taco Bell last year
      after a jury found the chain's managers guilty of erasing
      time and requiring off-the-clock work. "The store managers
      have a toehold in the lower middle class. They're being paid
      $20,000, $30,000. They're in management. They get medical.
      They have no job security at all, and they want to keep
      their toehold in the lower middle class, and they'll often
      do whatever is necessary to do it."

      Another reason managers shave time, experts say, is that an
      increasing part of their compensation comes in bonuses based
      on minimizing costs or maximizing profits.

      "The pressures are just unbelievable to control costs and
      improve productivity," said George Milkovich, a longtime
      Cornell University professor of industrial relations and
      co-author of the leading textbook on compensation.

      Beth Terrell, a Seattle lawyer who has sued Wal-Mart,
      accusing its managers of doctoring time records, said: "Many
      of these employees are making $8 an hour. These employees
      can scarcely afford to have time deleted. They're barely
      paying their bills already."

      In the punch-card era, managers would have had to conspire
      with payroll clerks or accountants to manipulate records.
      But now it is far easier for individual managers to
      accomplish this secretly with computers, payroll experts say.

      Pooters, a father of five who left the Air Force in 1997 for
      a career in retailing, talks with disgust about photocopied
      Toys "R" Us records that he said showed how his manager made
      it appear that he had clocked out much earlier than he had.

      "Unless you keep track of your time and keep records of when
      you punch in and punch out, there's no way to stop this," he
      said.

      After leaving Toys "R" Us and Family Dollar, Pooters moved
      to Indiana and took a job as an account manager with
      Rentway, a chain that leases furniture and electronics.
      There, he and a co-worker, William Coombs, said, the
      workload was so intense that they typically missed four
      lunch breaks a week. Nonetheless, they said, their manager
      inserted a half-hour for lunch into their time records every
      day, reducing their pay accordingly.

      "They told us to sign the payroll printouts to confirm it
      was right," Pooters said, describing a confrontation last
      November. "When we protested about what happened with our
      lunch hours, the manager said, 'If you don't sign, you're
      not going to get paid.'"

      Coombs said: "They removed our lunch hours all the time. We
      were told if we didn't sign the payroll sheets, we'd be
      terminated."

      Larry Gorski, Rentway's vice president for human resources,
      said his company strictly prohibited erasing time. "As soon
      as we hear this is going on, we jump all over it," he said.

      Shannon Priller, who worked at a Family Dollar store in Rio
      Rancho, N.M., sheepishly acknowledged that she sometimes
      watched her district manager erase her hours. "The manager
      and I would sit there and go over everybody's time cards,"
      she said. "We were told not to go over payroll, or we would
      lose our jobs. If we were over, my hours would get shaved."

      Some weeks, she said, she lost 10 or 15 hours, and her 6
      a.m. clock-in time became 9 a.m. Patricia Bauer, a clerk at
      the store, said her paycheck was sometimes cut to under 30
      hours on weeks when she worked 40.

      Like Pooters, these women have joined a lawsuit that accuses
      Family Dollar of erasing time and requiring off-the-clock work.

      Kim Danner said that when she ran a Family Dollar store with
      eight employees in Minneapolis, her district manager urged
      her to erase hours so that she never paid overtime or
      exceeded her allotted payroll. Federal law generally
      requires paying time-and-a-half to nonmanagerial employees
      who work more than 40 hours a week.

      Danner said her employees could not do all the unloading,
      stocking, cashier work and pricing of merchandise in the
      hours allotted. "The message from the district manager was,
      basically, 'I don't care how you do it, just get it done,'"
      she said.

      So she altered clock-out times and inserted half-hour lunch
      breaks even when employees had worked through them. "I felt
      horrible that I was doing this," she said. "I felt
      pressured, absolutely. If I refused, I would have been
      terminated easily."

      After five months, she quit.

      Sandra Wilkenloh, Family Dollar's communications director,
      declined to respond to the lawsuit, but said, "Family
      Dollar's policy is to fully comply with all wage and hour
      laws and to take appropriate disciplinary action in any case
      where we determine that such policy has been violated."

      She said Family Dollar maintained a hot line that employees
      could call anonymously to report wage violations.

      Rosann Wilks, who was an assistant manager at a Pep Boys in
      Nashville, said she was fired in 2001 after refusing to
      delete time. She said her district manager told her, "Under
      no circumstances at all is overtime allowed, and if so, then
      you need to shave time."

      At first, she bowed to orders and erased hours. Some
      employees began asking questions, she said, but they refused
      to confront management. "They took it lying down," she said.
      "They didn't want to lose their job. Jobs are hard to find."

      When she started feeling guilty and confronted her district
      manager, she said: "It all came to a boil. He fired me."

      Bill Furtkevic, Pep Boys' spokesman, said his company did
      not tolerate deleting time.

      "Pep Boys' policy dictates, and record demonstrates, that
      any store manager found to have shaved any amount of
      employee time be terminated," he said. He added that the
      company's investigation "revealed no more than 21 instances
      over the past five years where time shaving" had occurred.

      More than a dozen former Wal-Mart employees said time
      records were altered in numerous ways. Some said that when
      they clocked more than 40 hours a week, managers transferred
      extra hours to the following week, to avoid paying overtime.
      Federal law bars moving hours from one week to another.

      Wal-Mart executives acknowledged that one common practice,
      the "one-minute clock-out," had cheated employees for years.
      It involved workers who clocked out for lunch and forgot to
      clock back in before finishing the day. In such situations,
      many managers altered records to show such workers clocking
      out for the day one minute after their lunch breaks began --
      at 12:01 p.m., for example. That way a worker's day was
      often three hours and one minute, instead of seven hours.

      Williams, the Wal-Mart spokeswoman, said Wal-Mart had
      broadcast a video to store managers last April telling them
      to halt all one-minute clock-outs. Under the new policy,
      when workers fail to clock in after lunch, managers must do
      their best to determine what their true workday was.

      In interviews, five former Wal-Mart managers acknowledged
      erasing time to cut costs. Victor Mitchell said that as an
      assistant manager in Hazlehurst, Miss., in 1997, he
      frequently shaved time.

      "We were told we can't have any overtime," he said. "It's
      what the other assistant managers were doing, and I went
      along with it."

      Mitchell said the store's manager ordered them to stop. But
      he said that in 2002, after becoming manager of a Wal-Mart
      in Bogalusa, La., a new district manager ordered him to
      erase overtime. He said he refused.

      Williams said Wal-Mart had increased efforts to stop
      managers from shaving time or allowing off-the-clock work.

      Wal-Mart has circulated a "payroll integrity" memo, saying
      that any worker, "hourly or salaried, who knowingly
      falsifies payroll records is subject to disciplinary action
      up to and including termination."

      Employees at Wal-Mart and other companies complain that they
      receive no paper time records, making it hard to challenge
      management when their paychecks are inexplicably low.

      Danner, the former Family Dollar manager, praised the system
      at the McDonald's restaurant she managed for seven years. At
      day's end, she said, employees received a printout detailing
      total hours worked and when they clocked in and out.

      "We never had any problems like this at McDonald's," she said.

      --
      Dan Clore

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