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California's top wage thief

SCOTT DETROW, HOST:

Not paying somebody for a job they did, it's illegal. It's called wage theft. In California, the worst offender who's been cited by state regulators has paid only a tiny fraction of the millions of dollars that he owes workers. From member station KQED, Farida Jhabvala Romero reports.

FARIDA JHABVALA ROMERO, BYLINE: Back in 2016, carpenter Saul Pedroza got a job with a company called RDV Construction. He worked with a crew installing steel rods and wooden frames to build an apartment complex in LA County, but for a full month, Pedroza was never paid.

SAUL PEDROZA: (Through interpreter) Supervisors started saying that paychecks would come next week and then the next. That's how they strung us along.

JHABVALA ROMERO: When the checks never came, Pedroza quit. He was left with no money for rent or groceries for his kids.

PEDROZA: (Through interpreter) We struggled for a long time without any money.

JHABVALA ROMERO: It turns out the company that stiffed Pedroza did the same thing to more than a thousand other workers. Citations issued by the California Labor Commissioner's office in 2018 and 2019 say RDV and another company owned by the same man, Rafael Rivas, owe more than $16 million in back wages and penalties. But so far, the agency has recovered less than 2% of what's due, barely $300,000.

BENJAMIN WOOD: It's outrageous. It's infuriating.

JHABVALA ROMERO: Benjamin Wood is a former organizer with the Pomona Economic Opportunity Center, a nonprofit that supports day laborers. He's helped dozens of workers file wage claims with regulators, including against RDV.

WOOD: The state that has so much power to enforce, you know, criminal laws - but then when it comes to this massive wage theft, they seem like they're powerless.

JHABVALA ROMERO: The California Labor Commissioner's office declined multiple interview requests, but in a statement, the agency said it will keep exploring all available avenues for restitution. Court records and government documents show Rivas appealed the citations. Then pandemic disruptions and understaffing at the agency delayed the case. Rivas used that time to shut down RDV and filed for bankruptcy for his other company, called RVR General Construction. Then, in federal bankruptcy court, RVR agreed to pay 7.6 million, but under the current payment schedule, the company would take 50 years to cover even that partial restitution for workers.

BETH ROSS: It just is really a shame.

JHABVALA ROMERO: Beth Ross is an employment attorney who's represented many workers cheated out of their wages.

ROSS: These workers are so unlikely to see any amounts of money that could ever remedy the wrong that they suffered.

JHABVALA ROMERO: It's not clear what Rivas and his companies can truly afford to pay, or if the labor commissioner's office has looked hard enough. So I went looking for Rafael Rivas.

(SOUNDBITE OF DOOR KNOCKING)

JHABVALA ROMERO: Nobody opened the door at a residential address he owns in San Bernardino County. And by the looks of it, it's unclear to me if anybody lives here. The blinds are closed. We couldn't confirm Rivas owns a new Maserati Grecale GT that was parked on the driveway. RVR General Construction's business address turned out to be a barbershop in front and a residence in the back. County records show Rivas transferred ownership of this property, with an estimated market value of 1.4 million, to a family member after his company filed for bankruptcy. But it's not clear why the labor commissioner hasn't gone after those assets.

UNIDENTIFIED PERSON: (Non-English language spoken).

JHABVALA ROMERO: A woman eating lunch at the house identified herself only as Rivas' ex. Before closing the door, she said they no longer talk to each other. Rivas did not return email, phone and in person requests for comment. In bankruptcy filings, he blamed the wage theft on family business partners. They also refused to speak with me. Meanwhile, RVR General Construction is still operating, and Rivas' former employees don't have their wages. Carpenter Javier Gonzalez is owed $11,000.

JAVIER GONZALEZ: (Through interpreter) I see it like he's made a mockery of all the people they defrauded and of the government.

JHABVALA ROMERO: Gonzalez says he can't afford a lawyer, so his only hope is that the labor commissioner's office steps up. For NPR News, I'm Farida Jhabvala Romero in Pomona, Calif. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Farida Romero