Who’s Paying for Our Productivity?


Under the heading “Caution: Weasels at Work” (which I damn near stole, it’s so good), ratboy’s anvil links to a long story in today’s NY Times about the newly-discovered (though old in execution, trust me on that one–been there, done that, bought the t-shirt) corporate theft device, time-shaving. “Shaving time” is when a corporate manager sneaks into the records and deletes some of the hours worked by each of his/her employees. That’s right: time-shaving is the corporate policy – unwritten, of course, it’s always passed on verbally to managers — of cheating its employees of money they have earned.

I remember this practice from the 60’s and 70’s. Federal crackdowns and Labor Dept lawsuits pretty much stamped it out — it is illegal, after all. But in the lax, corporate-friendly/worker-hostile era of BushCo, it has made a roaring comeback, small surprise.

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 photocopy centers, totaling $56,600, after finding that managers in Ithaca, N.Y., and Hyannis, Mass., had erased time for 13 employees.

Computers, to be honest about it, may have made this a little easier but not that much easier. It was always pretty easy. Employers used to dick around with the actual time cards but tampering was too easy to spot. By the time I was working as a spot-welder for a small company in NH, managers had figured out that they were the ones who had control of both the time cards and the payroll sheets, and that no one could prove shaving without seeing both. So they made policies that time cards were company property and workers weren’t allowed to see them after they were turned in to the payroll dept.

Once everything was locked up, only the bookkeepers and managers had access to the records. Managers made changes in the hours numbers on the payroll sheets, and if you complained those were what you were shown. If you wanted to see the time cards to compare them with the payroll sheets, well, no, you couldn’t do that because, you see, the time cards were private property; you’d need a court order to pry them loose.

There’s nothing new under the sun, folks.

This practice is blatantly, obviously, and spectacularly illegal. Worse, it is dishonest. I might even say vile. There’s no possible excuse for it, and no legitimate reason to do it. It is embezzlement, pure and simple. So why do it? Same old answer: Greed.

“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.”

The companies, of course, claim it is contrary to their policies–

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.”

–but the defendants say it’s common practice and it comes on orders from the top.

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.”

***

Mr. Pooters…landed 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,’ ” Mr. Pooters recalled, saying that when he refused, the district manager erased the hours herself.

***

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.”

One manager who also “went along” eventually got guilty about it and refused to continue.

She was fired.

“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. “All this manipulation of payroll may be the unintended consequence of increasing the emphasis on bonuses.”

So managers are stealing money from employees who make $8/hr to make sure they get a bonus that may be more than that worker’s entire salary. And if a few kids have to go without food or a doctor when they’re sick, that’s less important than that the manager rake in his extra $15G’s every year. After all, they aren’t his kids. And he mustn’t “lose his toehold in the lower middle class.”

But it’s hard to blame the managers, after all. The multi-millionaire owners and CEO’s of these companies have them in a stanglehold. If you’re only getting $30K/yr and a third of it — or more — is contingent on its being stolen from other people a little at a time, you may very well feel you don’t have any choice unless you’re willing to join your employees in starving to death. America, you may have your high productivity but there’s a catch: You have to steal it.

In BushCo America, even morally contemptible and savagely unethical practices are apparently acceptable in the name of increased profits and personal enrichment. Elaine Chow’s Labor Dept has investigated not one of these cases. Wal-Mart can lock its janitors in at night and demand that their workers put in hours for NO pay at all without any fear whatsoever of govt reprisals — this is a Federal law, like the 40-hr work-week (also routinely ignored) and time-and-a-half, and part of the job of the Labor Dept is enforcing Federal labor laws. But enforcement, when it comes, comes from the legal system — the corporations are so far up the BA’s ass they can smell Elaine Chow’s toast burning. They are making it necessary to sue them just to get paid, and the Labor Dept, golly whiz, doesn’t know a thing about it. I bet they’re shocked, shocked to discover that such things happen.

The Days of the Robber Barons are back. Thanks, Elaine!

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