Inspired by a Potomac man's five-year battle with Congressional Country Club over wages withheld from its service employes, Maryland State Sen. Stewart W. Bainum (D-Montgomery) has filed legislation to toughen penalties against employers who "skim" a worker's pay.
Bainum introduced the measure at the request of George W. Koch, who in the past has accused his club of illegally withholding wages from some of the club's service employes.
Koch's charges in the mid-1970s made him a virtual pariah at Congressional, one of the area's most prestigious clubs. His complaints also prompted the state to investigate the group's employment practices.
The Maryland attorney general's office, which later found that the club had engaged in irregular payroll practices, did not prosecute the club because the statute of limitations had expired.
Withholding employe wages is not illegal if the affected workers agree to the practice, the attorney general's office said during the controversy over Congressional's payroll practices. Since the late 1940s, the club had deducted 20 percent from some employes' pay in an effort, club officials said, to equalize earnings of those workers who received tips and those who did not.
"If we had had this law around then," Bainum said last week after a Senate committee hearing on the bill, "we might have been able to avoid the Congressional situation.
"That was Robin Hood in reverse: the most affluent people in Montgomery County taking from the least affluent," Bainum said.
If passed into law, Bainum's bill would authorize judges to award triple damages to workers whose pay was illegally withheld by employers.
"Now, there's no incentive for a dishonest employer to do anything but withhold wages," Bainum said. "If the state gets after them, all they have to do is cough up the back pay."
Last year, 356 wage-skimming cases were referred to the state's attorney general for prosecution--an increase of nearly 100 cases over the year before, said Nancy B. Burkheimer, a deputy state labor commissioner who supports Bainum's proposal.
The state labor commissioner has long had the legal authority to assess civil penalties of up to 20 percent of wages illegally withheld, but an opinion from the attorney general in the 1970s effectively nullified that power, Burkheimer said.
The Bainum bill "would provide us with judicial remedy," she said. "It might make employers stop and think if they knew that a judge could order triple damages for really flagrant violations."
The statewide Chamber of Commerce, which supports the thrust of the proposed law, has asked legislators to amend the measure, according to Christopher B. Costello, the business group's vice president for industrial relations.
Costello said the proposed bill's clause requiring judges to award triple damages for proven cases of wage-skimming should be changed to give judges total discretion in fining employers. In some wage-withholding cases, triple damages would be too harsh a penalty, said Costello.