News & Politics

New York City On $45 A Day (And That's If You're Lucky)

How one labor company made millions by exploiting its temporary employees a dollar at a time.
It's early on a cold December morning, and Diane Sawyer's irritating voice echoes off the white walls. "Okay, so it's one of those times of year when you're thinking about, ah, maybe I'll just call in sick today," she says. "After all, we're talking about the holidays...and it turns out sick calls are on the rise, especially this time of year." She hands off reporting to a Good Morning America correspondent, who investigates this growing trend, and whether falsely calling in sick can get a person fired (unclear, despite his digging).

No one in Labor Ready's office in the Sunset Park neighborhood of Brooklyn has called in sick today, and none appear particularly interested in what Sawyer has to say. The back room where we are assembled is a bare bones, characterless setting -- DMV office meets emergency room waiting area -- with a coffee pot, two tables, and a number of cheap chairs. A black man is in the corner, watching a movie on a portable DVD player. Two others engage in low-volume bullshitting; the others are sitting down and staring at their feet or, like me, trying not to fall asleep.

At this hour, with nothing to do, it's not easy to remain conscious. Some of the people have been here since 5 a.m., hoping to increase their chances of finding work, which means they get to look forward to three hours of empty time before work orders start coming in. Three hours is a long time to listen to Good Morning America and read the signs management has taped to the walls, which include "Leave the bling bling at home" and "86 the doo-rags." I catch myself nodding off twice.

But sleep, along with doo-rags and baggy pants -- "If your pants don't fit don't bother to sit" -- is also forbidden. "Sleepyheads don't get work," a sign above my head reads. Another, less friendly, reminds us that "if you fall asleep you must leave." I shake my head and yawn, and decide to step outside into the biting air for a jolt of life.

The Labor Ready office is located beneath the Gowanus Expressway on 3rd Avenue, an industrial area that by 7:30 a.m. is already filled with noisy trucks and blue-gray exhaust. The Sunset Park branch is one of four New York City offices, where employers can find cheap labor for unskilled tasks like demolition, loading and unloading goods, and manufacturing. Today they employ about 600,000 temporary workers each year, and have 880 offices located in the United States, Canada, Puerto Rico and England. The result of all this activity, according to Labor Ready's website, is a "win-win": employers can save money and Labor Ready workers earn "an honest day's pay for an honest day's work."

Back inside it's nearly eight o'clock, but not many calls are coming in. I take a seat next to a Latino man that appears to be in his fifties. To my left is a chest-high cash dispensing machine (CDM) that is no longer functioning, thanks to a 7-0 decision handed down by New York State's Court of Appeals on November 16. In the decision, the Court ruled that by charging workers a fee to receive payment in cash, the CDMs violate an 1889 state law originally written to prevent companies from paying their workers in script, which could then only be used at company stores.

Labor Ready's CDM system is simple: a worker can decide to be paid in cash, and will receive a voucher and PIN number to type into the CDM, upon which they'd be charged a transaction fee of one dollar and whatever change amount was listed on their paycheck. So when redeeming a check of $20.95, the worker would receive $19.00 while Labor Ready would pocket $1.95.

Not bad, for doing nothing -- and it added up. In 2002, according to court documents, Labor Ready took in $8.3 million from their CDMs across the country. But in the Court's decision, Chief Judge Judith Kaye wrote that the "unequal bargaining power between an employer and an employee" should not result in a situation where "the employer can divert a worker's wages for the employer's benefit." And so this morning the CDM sits next to me, with a sign taped across it explaining simply that it is not in service.

After twenty more minutes of waiting, I'm given something called a "Tensor Test," conducted to determine whether I present any behavioral challenges to Labor Ready. The first page of the test informs me that if I fail I am prevented from working for Labor Ready for one year, after which I can retake the test. Although the binder consists of many pages -- 73 questions in all -- there are really only three categories that they're nervous about: fighting, stealing, and drugs. Some questions have obvious answers; others are slightly trickier, like:

How good are you at fighting using your hands and fists? a) Far above average
b) Slightly above average
c) Slightly below average
d) Far below average. I don't fight

Although I'd sometimes like to pretend otherwise, I select (d). Other questions include whether I feel it necessary to punch someone when they disrespect me, and which types of drugs I've used recently (they helpfully explain that I should feel free to select as many as pertain). They ask a variation of the drug question numerous times. They also ask me to estimate the value of the goods that I've stolen from previous employers in the past six months, and how many of my friends have recently been in brawls.

On a digital pad -- much like those used in grocery stores to make credit card purchases -- I punch in my answers. A few minutes after I'm done, the Labor Ready supervisor tells me I've passed. All that's left is to take a safety quiz and I'll be ready to work. Another Labor Ready rookie is currently taking the quiz, so I sit back down. By now, half a dozen men have been called up and are already headed out to work sites.

"Gabriel," the Labor Ready supervisor calls five minutes later. I get up from my chair and learn that there's work for me, if I want it, unloading auto parts in Staten Island. Pay is $7.25 an hour. Forgotten is the safety quiz. He hands me gloves, I'm given directions to the site -- take the R train to 86th street, and then the S79 bus over the Verrazano Bridge -- and walk out the door. It's 8:45 a.m.

It takes over an hour to get to the store. I walk inside and identify myself as a Labor Ready employee. Two men behind the counter look up. "You're late, Labor Ready," one of them tells me in an obnoxious voice. "The other guys are already downstairs. Better hope they don't just send you home."

I walk through the store and down a set of wooden stairs, where five other men are taking auto parts off the shelves and stacking them in grocery carts. "You Labor Ready?" one of them asks, who appears Middle Eastern.

"Yep."

He explains something about taking red boxes down, and I join in.

There are four other men in my work crew, the friendliest being a skinny 18-year-old from East New York that graduated from high school earlier this year. He's been working with Labor Ready for two months, and while we load up a cart he explains a few things that he feels I should know. "You work at Labor Ready, you're at the very bottom -- you know that right? No way you can work your way up here. See, this place here paying you seven bucks an hour, but they payin' Labor Ready maybe twice that. We at the bottom."

"So why are you here?" I ask.

He shrugs. "It keeps me awake. Nothing else does that. And why should I go to college? You get out, owe a bunch of money, and you'll still be working at McDonalds, just like everyone else."

We spend the next six hours moving engine starters among shelves, unloading a truck, and taking inventory. We're all sweating a bit, but make sure to take numerous impromptu breaks when the supervisor leaves, which he does every hour or so. By the end of the day we meet with our boss, a friendly white man, who tells us he appreciates our work and grants us a few extra hours on our time sheets. For my six hours of work, he writes nine. A nice guy.

By the time we get back to Labor Ready's office it's dark outside. My gross pay is $65.25, but is cut to $53.40 after taxes. I walk with the teenager from East New York and another worker to a nearby check-cashing place, and am charged one dollar for the transaction. Now I've got $52.40 cash in my wallet.

On the train home I take an inventory of my finances. It cost me two dollars in subway fare to get here, and another four dollars to get to Staten Island and back, then a final two dollars to get home (I could have saved a dollar by purchasing an unlimited card, but I couldn't have known this at the time that I boarded my first train). So after a 12-hour period spent waiting, traveling and working, my net income for the day is $45.40 (I don't blame Labor Ready for the check cashing fee) -- and that's with a boss that tacked on three extra hours. Plus, I was lucky enough to get work. Many times, according to veteran Labor Ready employees, you show up at 5 a.m., wait for hours, and leave with nothing to show for it.

This waiting in the office and staring at the walls -- equal parts boredom and desperation -- becomes translated in business plan speak as a "flexible workforce." If one is homeless, an addict, recently out of prison, or otherwise having a hard time finding work, Labor Ready offers the chance to earn a little cash. All they ask if that you show up early, sit around for hours, not curse, not be a sleepyhead, not wear baggy pants, leave the bling bling at home, pass the test, travel wherever they send you, pay for that travel, be nice to the boss, not steal anything, and 86 the doo-rags.

The result is a "win-win" for Labor Ready and their temporary employees. I've made $45.40 today. Labor Ready's revenue was more than $1 billion last year. It's great to play for a winning team.
Gabriel Thompson is a Brooklyn-based journalist. His book, There's No Jose Here: Following the Hidden Lives of Mexican Immigrants, will be published in January 2007 by Nation Books. He can be reached through his website, wherethesilenceis.org.