California Wage Theft Alleged at Bay Area Elder Care Facilities

Authorities in charge of investigating wage theft tend to avoid making generalizations about an entire industry. However, state and federal investigators have recently spoken out forcefully against what they say is a serious and growing problem for California workers: wage theft and other employee abuses at elderly care facilities.oldhands

It’s an industry that tends to employ workers who are poor and often illegal. That means they are more likely to be extorted and abused.

Case-in-point: Florinda Yambao. The 63-year-old woman owned numerous residential nursing homes throughout Contra Costa County. Last year, she was convicted of tax fraud, insurance fraud and theft. She had  defrauded workers of hundreds of thousands of dollars in pay and then, the court ruled, committed tax fraud in order to cover it all up. She was placed on probation and ordered to pay $1 million  in restitution to her victims.

But recently, according to the San Jose Mercury News, she was arrested again because, according to the District Attorney, she continued to withhold wages from her workers while she was on probation. Now, she faces additional charges, plus allegations of probation violation.

What’s especially troubling to our Orange County wage and hour theft lawyers is the fact that this is by no means an isolated incident. The Mercury News found that authorities in every single Bay Area county said they also had active wage-theft investigations against nursing homes.

There hasn’t been a similar report out of Los Angeles or Orange Counties, but this is presumably not limited to northern California. This is a statewide and probably a national problem.

California Labor Commissioner Julie Su said her office has been conducting outreach and collaboration with elder care facilities, helping to inform them of the law. Su said the majority of nursing homes do want to be in compliance, but many of them are not educated on what the labor law actually is.

Of course, our employment lawyers see that as a poor excuse. When someone is operating a business – particularly one that involves the employment of tens of thousands of workers and the care of our most vulnerable residents – it is their job to learn the labor laws.

Su said in most cases, owners snap up multi-bedroom houses and simply set up shop, renovating them and turning them into elder care homes. Employees live on site, they work 12-to-16-hour days and they are often paid a set monthly stipend. Usually, it works out to about $5 an hour or less. For this, they don’t pay rent, but they often sleep on the living room floor or in garages. Meanwhile, patients are charged thousands of dollars every month.

One fraud prosecutor noted this kind of action largely went unnoticed by authorities until about six years ago, when the federal Department of Labor and the state branch began fielding worker complaints. That’s when they issued notices to the public, asking other affected workers to come forward. They were stunned by the flood that did just that.

An advocate for nursing home reform said it wasn’t something officials paid attention to much prior to that.

The wage theft division of the federal labor department has begun doing random spot checks on nursing homes to make sure they are in compliance. However, most criminal investigations into wage theft are ignited with a worker complaint.

Contact the employment attorneys at Nassiri Law Group, practicing in Orange County, Riverside and Los Angeles. Call 714-937-2020.

Additional Resources:

Wage theft allegations grow against Bay Area elder care homes, Feb. 4, 2016, By Nate Gartrell, San Jose Mercury News

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