Interpretation of 100-Year-Old Law Keep State Labor Investigations Secret

You can’t know if your favorite bar stiffs its servers, according to Colorado law. You can’t know if your future employer cheats its workers. You can’t know if your competitor underbids you by skirting labor laws.

Colorado state Sen. Edward Affolter, left, and Sen. George Lewis co-sponsored the 1915 workmen's compensation bill that has ramifications today on Colorado Department of Labor and Employment disclosure.

Colorado state Sen. Edward Affolter, left, and Sen. George Lewis co-sponsored the 1915 workmen’s compensation bill that has ramifications today on Colorado Department of Labor and Employment disclosure.

It is illegal for the Colorado Department of Labor and Employment to disclose the name of an employer who has violated wage laws, no matter how egregious or – for that matter – benign the employer’s actions are. All complaints and investigations of employers, even after they’ve been resolved, are confidential under the state’s interpretation of a 100-year-old law.

In 1915 the Colorado legislature wrote the confidentiality into the first law on workers’ compensation. The statute specifies that information employers provided “shall be for the exclusive use and information of said commission in the discharge of its official duties and shall not be open to the public.”

The law now specifies that labor authorities “may” treat information containing “trade secrets” as confidential. The state’s lawyers, however, have interpreted the law to extend blanket confidentiality to cover all information on investigations of unpaid wages.

In an interview, state labor department spokesperson Cher Haavind said the department operates under the confines of the current law to protect employer and employee confidentiality. But there have been discussions about updating the law, she said.

“All of our divisions have talked about is it time to do an overhaul in that part of the law,” Haavind said.

This secrecy protects chronic violators and the state labor department from public scrutiny, an I-News investigation using open record requests has found. It prevents business competitors, consumers, and potential job candidates from being able to independently assess how often employees are taken advantage of, by whom, and how well the state is doing its job of collecting unpaid wages and deterring unfair treatment.

Additionally, state labor authorities rely on hunches and informal tallies from investigators to evaluate the department’s effectiveness, as its complaint database, created circa 2001, cannot perform basic data analyses that are easily accomplished in consumer software such as Microsoft Excel.

Mobile hone app, Eat, Sleep, Shop, puts federal investigations into unpaid wages, child labor and other violations at a user's fingertips.

Mobile hone app, Eat, Sleep, Shop, puts federal investigations into unpaid wages, child labor and other violations at a user’s fingertips.

In contrast, federal investigations into unpaid wages, child labor and other violations are available at the swipe of a finger. A mobile app called “Eat Shop Sleep,” powered by federal data, lets you track local businesses that have violated wage and workplace safety laws. If you want, you can even download federal data yourself.

New law does more to protect workers, but cloak of secrecy remains

A new state law entered into force Jan. 1 that is aimed at protecting workers. The Wage Protection Act beefs up the state’s ability to collect unpaid wages so workers who were never paid for their work can receive compensation. But given the secrecy of the department’s process, there’s no quantifiable way for lawmakers or the public to verify if the new law works.

Mobile hone app, “Eat, Sleep, Shop” puts federal investigations into unpaid wages, child labor and other violations at a user’s fingertips.

“At the end of the day we need to figure out how to protect the victims, while still making sure there’s some level of public accountability,” said the legislation’s co-sponsor, Rep. Jonathan Singer, D-Longmont.

Susan Gentry and Lisa Lucero are still waiting for the rest of their wages.

The women testified at a hearing in support of the new wage law January 2014. Now Lucero says the system hasn’t worked for her.

“I thought something was going to happen out of this, but I guess I thought too much because what really did happen out of it?” she said.

In 2013 Gentry and Lucero worked at National Multi List Service Inc., which hosts online sales ads for RVs, homes, boats and land. After months of work without pay, they complained to the Colorado labor department, which was able to recover some of their unpaid wages, according to court documents.

Gentry and Lucero sued their former employer for the rest. In May 2014 they reached a settlement where National Multi List Service agreed to pay the workers in bi-monthly installments of between $200 and $1,000. They were never paid, and are now back in court.

Colorado Department of Labor and Employment denial of an I-News information request through the Colorado Open Records Act.

Colorado Department of Labor and Employment denial of an I-News information request through the Colorado Open Records Act.

“Just because something is signed doesn’t mean it’s actual,” company co-owner and general manager Jim Brand said in a telephone interview, referring to the settlement agreement. “Doesn’t mean that we owe them that.”

Brand said that his co-owner paid the women out of his own pocket when the company was going through money troubles. When Lucero and Gentry sued, the company lacked legal resources, Brand said, and felt they didn’t have any other option but to settle.

The employees are still owed more than $8,000.

“We’re probably going to pay them,” Brand said.

The Colorado Attorney General’s office has received 19 consumer complaints since 2013 regarding National Multi List, in particular regarding the company’s alleged failure to honor terms of service and refund customers when their products didn’t sell.

The Colorado labor department, on the other hand, can’t say how many complaints it has received regarding National Multi List. News reports state it has received at least three complaints. A request for information under the Colorado Open Records Act in March was denied.

“Information supplied to the department is confidential pursuant to statute,” department spokesperson Haavind wrote in the denial letter.

The statute establishing confidentiality also states department employees can be fined $1,000 and barred from government service for divulging information to the public.

That punishment was one element that prevented Michael McArdle, director of the department’s Division of Labor, from releasing any information last November in response to an open records request from I-News regarding gas station chain Bradley Petroleum.

“Our state legislature has emphasized my responsibility to protect the confidentiality of the information, and concluded that divulging the information is an action punishable by a fine.” McArdle wrote.

While the current statute specifies the confidentiality of “trade secrets,” the state Attorney General’s office, which advises state labor authorities on the law, would not comment on what trade secrets would be divulged by releasing information on unpaid wage investigations.

An I-News investigation using court records showed Bradley Petroleum, one of the state’s oldest employers, has a history of investigations and settlements for violations of labor laws that stretches more than 30 years. The company has never admitted wrongdoing.

In an interview, McArdle said the legislature decides public policy.

“I can make recommendations and provide information, but I haven’t been granted a vote on those things.” McArdle said.

At the federal level, many records of labor law investigations are public except for proprietary business information, such as revenue, and workers’ personally identifiable information, which are redacted when documents are released to the public.

Transparency is as much about keeping tabs on the government as it is about shaming bad employers, said Jeffrey Roberts of the Colorado Freedom of Information Coalition, of which Rocky Mountain PBS is a member.

“When you’re talking about examining any part of government, you want to know not just the bad employers but if anything is being done about it,” Roberts said. “Getting records is key to examining the system.”

Dated technology also hinders understanding of law’s effectiveness

Even if the law allowed public disclosure of wage investigations, the department’s outdated technology would not make it easy.

Portions of the 1915 workmen's compensation law prohibiting disclosure of certain information has ramifications today on public knowledge of Colorado Department of Labor and Employment investigations.

Portions of the 1915 workmen’s compensation law prohibiting disclosure of certain information has ramifications today on public knowledge of Colorado Department of Labor and Employment investigations.

The database on worker complaints, known as eComp, cannot complete most functions easily accomplished by basic software. Instead, the department has to tabulate information, such as the state’s top ten violations, by hand.

“We have no way of getting that from the system, so we ask the compliance officers to keep track going forward,” McArdle said.

The department does know that on average it receives around 5,000 complaints a year and is able to recover approximately $1 million in wages. But as the new law takes effect, McArdle cannot determine if the employees are getting everything that they’re owed, or just a portion of it. He cannot track how many complaints are frivolous, or how quickly the department closes an investigation.

Instead, McArdle compares the amount of wages collected against states of comparable size, like Washington state. Otherwise, he won’t be able to to evaluate the state’s performance against how well it could be doing to implement the new law.

“It’s going to be kind of hard to compare directly,” McArdle said.

Lucero is slowly building back up her credit, she said, as she works for a “real company” that will pay her as it should. She and Gentry want their complaints to be public, they said.

Perhaps her experience can help others, Lucero said.

“To me it’s not confidential,” she said. “What’s there to hide?”

One thought on “Interpretation of 100-Year-Old Law Keep State Labor Investigations Secret

  1. The article about the state secrecy law regarding employers not paying their employees is another reminder of what unions do for their members. When an employer from Texas didn’t pay the hospital bill for an on the job injury I sustained the local had it paid within a few days and then went after the contractor to recover the money.

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