AG: Logan Airport contractor falsified payroll records
Not long after she started working for an airline contractor at Logan Airport in the summer of 2017, the payroll coordinator said, she was instructed to cheat workers out of wages.
Those workers, mostly wheelchair attendants who transport elderly and disabled passengers for JetBlue Airways and other airlines, made $11.25 an hour, plus tips, for Flight Services & Systems, known as FSS. Gratuities were supposed to bring the workers up to $12 an hour, the minimum wage at Logan at the time. To ensure this, workers were instructed to claim at least 75 cents in tips for every hour they worked — regardless of what they actually made. If they didn’t, the payroll coordinator did it for them.
After a few months, the payroll coordinator spoke up. A few weeks later, she said, she was fired.
Then she contacted the attorney general.
On May 1, Attorney General Maura Healey fined FSS, the largest contractor at Logan, more than $74,000 for falsifying records over a roughly four-month period in late 2017, in addition to violating the earned sick-time law and failing to pay workers on time.
Earlier in 2017, an audit by the Massachusetts Port Authority, which runs Logan Airport, found that FSS had committed more than 1,100 minimum-wage violations oftipped workers in a 16-month period in 2016 and early 2017 and ordered the company to pay $111,000 in back wages to just over 400 employees. Massport sent its findings to the attorney general in July, the same month the FSS payroll coordinator was hired.
FSS’s violations go far beyond what was found at Logan. Over the past 13 years, FSS has paid out more than $1 million in penalties and settlements for wage theft at airports around the country, according to court documents and US Department of Labor reports. Two current cases, in Massachusetts and in Louisiana, are seeking class-action status for wage-theft claims from FSS employees.
FSS and JetBlue Airways, the largest employer of the now 600 FSS workers at Logan, did not respond to messages seeking comment.
The former payroll coordinator’s account provides a rare inside look at wage theft, a phenomenon of underpaying workers that is prevalent among contractors — especially in the construction and hospitality industries — who compete against one another for jobs that often go to the lowest bidder. Nationwide, low-wage workers lose an estimated $50 billion a year to wage theft, according to the Economic Policy Institute, a left-leaning Washington, D.C., think tank.
In Massachusetts, the attorney general ordered companies to pay $9.6 million in back pay and penalties for wage infractions in fiscal year 2018 — up from $3.8 million in 2016, an increase due to a rise in complaints and a more aggressive pursuit of them.
The FSS payroll coordinator said she believes the company was attempting to cover its tracks after the audit when they instructed her to alter workers’ reported tips. In one e-mail she shared with the Globe, she was told that “records will need to be brought up to minimum wage before the payroll can be closed.”
Sometimes she doctored the pay records of as many as 200 people in a single biweekly pay period, she said, adding between $1 and $40 per person.
“I could not close payroll until all those people on paper looked like they made $12 an hour,” said the former employees, who asked not to be identified to protect herself from retaliation and to safeguard future job prospects.
Employers in Massachusetts are allowed to pay tipped workers a lower minimum wage (currently $4.35 an hour), as long as their gratuities bring them up to the standard minimum wage. If they don’t, the employer is required to make up the difference.
As more work is farmed out to subcontractors, and they get more sophisticated about how to shave off a few hours here and a few dollars there, the type of wage theft FSS is charged with is becoming more common, said Tom Juravich, a labor studies professor at the University of Massachusetts Amherst.
The fines and back pay companies are occasionally forced to cough up are seen as the cost of doing business, he said. And those it affects the most, mainly low-wage immigrant workers, are often reluctant to speak up because of language barriers or fear of losing their jobs.
A bill is again making its way through the Massachusetts Legislature that would hold lead contractors responsible for wage theft by subcontractors and allow the attorney general to bring civil cases to court and issue stop-work orders when violations are discovered.
“The regulatory system is not really meant to deal with this many workers in this informal economy,” Juravich said. “As long as there’s really no perceived penalty by employers, then this will continue.”
The charges against FSS — including small fines levied by the Massachusetts attorney general in 2012 and 2013 for underpaying workers — are among a string of wage and hour violations by numerous contractors at Logan. According to complaints from 2012 to 2018 obtained from the attorney general’s office through a public records request, airport workers said they had been denied overtime and vacation pay, cheated out of break time, had money deducted from their paychecks for jackets they never received, and gone unpaid for required training sessions. One worker said he was forced to punch in with someone else’s time card so he didn’t rack up overtime pay.
In 2012, 32BJ Service Employees International Union District 615, the union trying to organize local airport workers, sent a letter to the attorney general stating that wheelchair attendants at three companies, including FSS, were required to report the exact amount of tips that would bring them up to $8 an hour, the minimum wage at the time, even if they had not received that amount in tips. “They believe this to be a condition of employment,” the union said in the letter.
In January 2018 , Massport eliminated tipped wages at the airport, and wheelchair agents now make $14 an hour, the airport authority’s minimum wage. But problems persist.
Ibtissem Lamri, an FSS wheelchair agent at Logan Airport, said that managers last year suddenly started docking her pay for an hour-long unpaid break, instead of the half-hour unpaid breaks the company required workers to take — telling her that was the reason her paycheck was short. Many days, she doesn’t even have time to take any break during her eight-hour shift, she said, but still gets docked for it.
Other FSS workers who talked to the Globe said the company routinely shorts their hours, telling them they don’t have to pay them for the time they spend waiting for planes to arrive. Others say they have had their hours cut or were threatened when they spoke out.
Lamri, who is from Algeria, said many of her coworkers don’t speak English and are afraid to push back against FSS.
“They think that we are stupid, we don’t understand, we are like animals,” she said.
“We are working a lot, a lot,” she said, noting she sometimes has to push two wheelchairs at a time. “Nonstop, nonstop. We are running, running, running, running.”
On May 8, a week after the attorney general issued charges against FSS, Massport informed the company it was in violation of its contract and had 30 days to come up with a plan to resolve the issues. Massport also called on FSS to address incidents of discrimination, sexual harassment, and retaliation.
If FSS does not comply, Massport can terminate its contract, said acting chief executive John Pranckevicius.
“If they’re not paying their employees or treating them disrespectfully . . . then that’s a concern to us,” he said. “It won’t be tolerated.”
Despite the attention paid to wage theft at Logan in recent years, the problem is getting worse, said Roxana Rivera, head of 32BJ SEIU District 615.
“It’s been seven years of us raising this issue,” she said. “How many laws does a contractor need to break for Massport and the airlines to say this contractor should not be here?”