Co-Chairs Woods and Gomberg, and Members of the Committee,
My name is Kathy Lara, Policy Analyst for the Oregon Center for Public Policy, and I respectfully submit this testimony in support of HB 5015 on behalf of the Center. The Oregon Center for Public Policy is a nonpartisan think tank that uses research and analysis to improve the economic outcomes for all Oregonians, especially for those struggling to make ends meet.
When Oregonians go to work, they expect to be paid. Despite laws to protect employees from being stiffed by their employers, too many workers in Oregon aren’t paid the wages they’ve earned. In such instances, known as wage theft, many workers turn to the Bureau of Labor and Industries (BOLI) for help.HB 5015 provides critical funding to BOLI to strengthen enforcement of Oregon’s wage and hour laws and protect workers and businesses.
HB 5015 strengthens BOLI’s ability to enforce the minimum wage. The minimum wage is a key policy for ensuring that hardworking Oregonians can provide for themselves and their families. Unfortunately, minimum wage violations are common. From 2010-2020, Oregon workers lost an estimated $283 million to $405 million a year due to being paid less than the minimum wage. An average of 88,000 to 128,000 Oregon workers get paid less than the minimum wage every year. With more resources, BOLI would be better able to enforce the state’s minimum wage law.
HB 5015 strengthens BOLI’s enforcement capacity. BOLI’s Wage and Hour Division has seen a sharp increase in wage theft claims in recent years. Yet, BOLI’s ability to investigate and tackle wage theft remains well-below what it used to be, when compared against the size of Oregon’s workforce. The state now has less capacity to investigate and enforce claims than it did in past decades.
HB 5015 helps ensure that employers found to have broken the law pay the wages and penalties owed. Limited state capacity hampers Oregon’s ability to ensure that workers are able to collect the wages they are owed. From 2015 to 2022, 41 percent of wages and penalties ordered by BOLI against employers went unpaid. In industries with large numbers of low-wage and undocumented workers, such as agriculture, restaurants, and construction, collection rates were even lower. With more staff, BOLI would be able to do more to ensure that employers found to have violated wage laws actually pay the wages and penalties assessed by the agency.
HB 5015 protects honest businesses and state revenues. Meaningful and effective enforcement of labor laws levels the playing field for businesses. Holding bad actors accountable ensures that businesses that follow the law aren’t undercut by those who cheat workers out of their pay. And by enforcing wage laws, the state collects revenue (income and payroll taxes) that pays for essential services.
HB 5015 represents a step toward better enforcement of our wage and hour laws. By investing in BOLI, we can make sure that Oregon workers are compensated for the hours they work and that employers that follow the laws are not placed at a disadvantage.
We urge you to support HB 5015.
