Chicago Establishes City Hall Watchdog Office To Protect Restaurant/Bar Workers

In a move that should help workers in Chicago’s restaurant and bar industry, the city council this afternoon approved the creation of the Office of Labor Standards. That brings Chicago in line with other cities including New York, San Francisco, and Seattle which have already established its own offices. The labor watchdog would conduct investigations to help workers combat wage theft, harassment, and a lack of sick time. The office aims to protect low-wage workers from abusive employers who take advantage of their employees.

Creating the new office offers a chance to build trust between workers (not just in the food and beverage sector) and their government, according to labor advocates. A variety of reasons — culture, language, and immigrant status — discourage workers from reporting crimes. The new Chicago office would look into complaints that don’t receive the proper attention in the hospitality sector, advocates said. The center will open on January 1 with five full-time workers. They’ll fall under the city’s business affairs and consumer protection department, as BACP already regulates licensing. There could be a scenario where the Office of Labor Standards recommends that BACP should revoke a restaurant’s license, said Adam Kader, the worker center director for Arise Chicago. Arise is an organization that’s part of a coalition that worked more than two years to create the office.

“If the city’s health department can shutdown a restaurant for rats, why wouldn’t you want the city to shutdown a business when the only reason they’re able to operate is they’re not paying minimum wage or overtime?” Kader said.

Workers needed the watchdog now more than ever, Kader added. The current political climate is unfriendly to all laborers, especially to women and immigrants. By working with the inspector general, the office will help give more teeth to existing laws. The office will also be there should the city council mandate family leave or add other labor laws.

About 20 percent of Arise’s 1,400 clients are in the hospitality industry. The not-for-profit has been around since 1991. The key to persuading aldermen was to personally introduce them to abused workers, Kader said. Arise brings up examples of employers exploiting their employees’ educations. For example, Arise pointed out that one West Loop business initially offered an employee a job for $10 an hour. Chicago’s minimum wage is $11 per hour (that rate increases to $13 per hour next year). Kader said the restaurant owner was so brazen that they have the paystubs to prove the violation.

In other instances, employers will try to avoid paying taxes by paying workers as independent contractors. That prevents workers from being paid a higher overtime rate if they go over 40 hours per week. That’s wage theft and it’s difficult to hold employers accountable. But restaurant owners should be in favor of the new office, Kader said. It will help level a playing field. Chicago’s restaurant industry is volatile, and when some companies are treating workers illegally to save money, it’s unfair to the restaurants that respect the laws, Kader said.

There are several cases where an Office of Labor Standards may have helped in Chicago. There’s the case of the 16” on Center, and the allegations coming out of Pilsen. The owners of Punch House/Dusek’s continue to conduct their investigation of allegations that include harassment. Then there’s Four Corners, the hospitality arm of Sterling Bay. The company — which owns Benchmark, Federales, and others — is entangled in a lawsuit where workers are alleging the company’s bars and restaurants withheld $30 million in tips. A court date for that case is scheduled for November.

If diners want to help create better work environments at restaurants, Kader recommends talking to servers and asking them about if they’re properly paid. Boycotts are one thing, but communication can’t be understated.

“The fact of the matter is that most places are bad and the only way we find out is when we start talking,” Kader said.

Read the full ordinance below.