Ron Kim Targets a Progressive Heavyweight in Allegations of Wage Theft

Kim accuses the Chinese-American Planning Council of rampant wage theft—and, in coordination with 1199SEIU, of blocking workers’ access to the courts.

Daniel Moritz-Rabson   ·   January 4, 2022
All were doing is covering up each others flaws, Kim said. | Office of Assemblymember Ron Kim

This story was co-published with The American Prospect.

In April 2020, New York Assemblymember Ron Kim co-chaired a virtual town hall to discuss Asian-Latinx immigrant worker solidarity during the pandemic. Representatives from three other organizations spoke at the event, including the chief public affairs officer of the Chinese-American Planning Council (CPC), a social services organization and prominent New York advocate with a mission “to promote the social and economic empowerment of Chinese American, immigrant, and low-income communities.”

Kim had previously appeared with CPC in November 2019, when he and New York state Sen. Julia Salazar announced a plan to set up the nation’s first public payment system. CPC praised the initiative for its potential to compensate undervalued care workers.

But on Tuesday, Kim’s office released a report accusing CPC, which employs 4,500 home health aides in New York City, of engaging in rampant wage theft—and, in coordination with 1199SEIU, the nation’s largest health care union, of blocking access to courts for workers trying to win their wages back.

The explosive 103-page report, written by Kim’s legislative director, David Lee, and titled The Nonprofit War on Workers, Part 1, accuses CPC’s Home Attendant Program (CPCHAP) of systematically abusing Chinese immigrant home health workers, using a prolonged forced-arbitration scheme to prohibit justice for these workers, and relying on its connections with progressive lawmakers and associations to avoid scrutiny for massive labor abuse.

“Its [CPC’s] actions in the judiciary have invoked among the worst of anti-labor jurisprudence in American labor law to deprive immigrant workers under its command of fair recourse for payment,” the report alleges, charging that the organization has created a precedent that will reverberate across the home care industry.

Interviewed for this article, CPC President Wayne Ho said the organization has followed labor law and that the fault for inadequate wages lies with state policy, which his group has pushed to reform. If CPC paid back wages, which Kim’s report estimated could be as much as $14 million, it would go bankrupt, Ho said, leaving patients without assistance and workers without jobs.

Last winter, Assemblymember Kim burst into the national spotlight when he challenged former Gov. Andrew Cuomo on his handling and cover-up of thousands of nursing home deaths. Kim’s legislative director, who authored analyses on Cuomo’s corporate immunity clause and the report released on Tuesday, compares the gravity of the allegations in the report to those levied against the former governor.

Workers’ allegations against CPC stretch back years, as does their criticism of 1199’s role. But prominent progressive elected officials and groups have until now mostly stayed on the sidelines in the dispute, choosing to voice support for policy reform that could forestall similar issues in the future rather than to focus on the labor practices of an influential progressive ally.

“I think this report really puts a flag in the ground for the new left, which is that nothing is off the table when it comes to protecting workers, and nothing is off the table when we’re investigating the exploitation of vulnerable individuals,” Assemblymember Emily Gallagher said.

SEIU and CPC are major players and major supporters of the left, so it is challenging to think about those relationships being harmed.”

24-Hour Shifts

As a garment factory worker in New York City for more than two decades, Mei Kum Chu had worked 12-hour shifts, sometimes laboring seven days a week. After the terrorist attacks of September 11, 2001, shut down dozens of factories, Chu shifted industries and began working for CPC. As a home health aide, she worked even more, she recalled through a translator.

Chu immediately began 24-hour shifts, she said, sometimes for up to four days at a time. Her patient, who had suffered a stroke, had a litany of health problems including diabetes, high blood pressure, and a broken leg. Chu had to flip the woman, who was in her seventies, every 90 minutes, which she said caused an arm injury she still experiences today.

Chu was only paid $10 an hour on weekdays and an additional $16.95 for each 24-hour shift.

Home health care aides at a protest | Courtesy of Flushing Workers Center

Lai Yee Chan started working at CPC in 2001. Though she initially worked shorter shifts, she too was asked to attend to patients through the night. Like Chu, she received only a fraction of the pay she was entitled to, she said. In 2014, Yee was given a $200 check from the Department of Labor—compensation for her thousands of hours of overtime.

The practice of home health aides working 24-hour shifts without corresponding pay is not unusual in New York, where 90 percent of home health workers are women, 60 percent are immigrants, and 18 percent live below the poverty line. As the state’s population ages, the number of home health and personal aide jobs in the state is expected to increase from 440,000 in 2018 to 700,000 in 2028.

“First and foremost, these are immigrant women, women of color. There’s a deep-seated thinking in this country that these workers are expected to just deal with horrendous conditions,” said Sarah Ahn, an organizer with the Flushing Workers Center.

Home health providers in New York state, like CPCHAP, operate under guidance from the New York Department of Labor, which stipulates that home health aides can be paid for 13 hours of a 24-hour shift. This guidance states that workers must be able to sleep eight hours—including five hours of uninterrupted sleep—and eat for three hours of their shift.

But if they do not receive the breaks they are legally entitled to, the New York State Court of Appeals affirmed in 2019, workers must be paid for all 24 hours.

That provision is often ignored. In reality, workers often end up working uncompensated hours to attend to patients who need attention through the night. In the six years before March 2018, 145 class action complaints were filed by workerschallenging the pay standard.

Forced Arbitration

After years of work for CPC, both workers brought lawsuits against the agency, Chan in 2015 and Chu in 2016. The lawsuits alleged that CPC had violated the New York Labor Law, the Home Care Worker Wage Parity Act in Public Health, and the New York City Fair Wages for New Yorkers Act, among other claims.

The litigation has taken a circuitous path. In 2015, CPC sought to dismiss Chan’s suit and moved the case to federal court. At the end of the year, 1199, which represents CPC home health aides, and CPC agreed to amend the collective-bargaining agreement governing disputes with workers, forcing the workers to mediate legal claims through arbitration.

(A spokesperson for 1199 wrote in an email that “The [Collective Bargaining Agreement] was collectively bargained and ratified by the workers and allows claims to be heard efficiently and with full remedies.” Kim’s report noted that flyers sent to bargaining unit members prior to the agreement changing did not mention forced arbitration.)

The process of forced arbitration moves complaints out of court and into a separate mediation process, and has been criticized for disempowering employees. The House of Representatives passed legislation to ban forced arbitration in 2019.

Chan’s case has shuttled from one legal venue to the next, without resolution. Chu’s case has similarly dragged on, moving from the New York Supreme Court to federal court to state court to arbitration, before being dismissed in 2019 and resumed in 2021.

In 2019, 1199 filed for a systemwide grievance seeking to resolve a series of lawsuits in one larger settlement.

Kim’s office and workers’ advocates expressed concerns that such a large settlement would limit the possibility for recourse, as it would spread any monetary compensation payments over a vast number of workers.

“The Union filed an industry-wide grievance and arbitration on behalf of our more than 100,000 members employed by more than 40 agencies covering wage and hour claims,” a spokesperson from 1199SEIU wrote in an email, noting they expect an arbitration award in 2022.

Michael Taubenfeld, the co-counsel for both Chu and Chan, said that legal efforts from 1199 and CPC blocked his clients’ access to the courts. “We’re not even fighting for money, yet. We’re fighting to litigate. That’s what’s been so frustrating,” he said.

As the lawsuits have dragged on, workers have held protests. Chu, now 71, has attended some demonstrations.

“I want to ask why you take so long—six, seven years already,” Chu, now retired, said through a translator. “All we ask [for] is very simple, to pay us all the back pay and end the 24-hour workday.”

“Home Care Agencies Would Go Bankrupt”

CPC has long maintained that only the state can secure full wages for home health aides.

The group is part of the Community-Based Home Care Workgroup, an organization that serves almost 12,000 people across New York City and has pushed for boosting Medicaid reimbursement rates and other legislative solutions to the underpayment of home health work.

CPC has also independently lobbied to end the 13-hour rule. In November, CPC’s chief policy and public affairs officer testified before the Assembly that “home care agencies are beholden to the rates and requirements laid out by Medicaid and the State, and cannot compensate their workers adequately when faced with inadequate Medicaid reimbursement.”

The same month, CPC President Wayne Ho wrote a letter to Senate and Assembly leaders, as well as Gov. Hochul, calling the 13-hour rule “unsustainable and unfair” to home care workers. Ho also said that they had helped get ten legislators to support a reform bill.

Ho said that CPCHAP has continued to comply with labor standards and sent five recent audits. Three of the audits were from organizations that settled lawsuits for Medicaid fraud within the last four years. Two were from the New York City Human Resources Administration, which in 2021 found that the provider’s home attendant program was in compliance with payroll, wage, and overtime legislation.

“I would argue that we want the same thing, that we want to end 24-hour shifts, that we want 12-hour split shifts, that we want to do right by the workers, that we need state resources and investments into the home care sector,” Ho said before the release of the report, noting that he had not seen the report before its publication.

Kim’s report argues that pointing the finger at the 13-hour rule amounts to misdirection from continuing labor abuses. (Since CPC’s workers weren’t given the stipulated hours for sleep and meals, the report argues, they are entitled to payment for the full 24 hours in all-day shifts.)

Rather than joining in calls for more funding to reimburse workers, Kim’s office alleges that CPC’s lack of compliance with Medicaid reimbursement requirements means CPC should be ineligible for future funding.

Both Ho’s office and 1199SEIU have warned that being forced to pay back wages will leave providers bankrupt.

Kim and then-mayoral candidate Andrew Yang at an event with protesting workers | Courtesy of AM Kims office

“There are no options for us to end existing cases, provide back pay to home care workers for the 11 hours per shift that the State does not reimburse for, or provide two 12-hour split shifts moving forward other than State funding,” Ho wrote in an email.

“If home care agencies were to try to do so without increased Medicaid funding, CPCHAP and other home care agencies would go bankrupt, and it could lead to the full collapse of the Medicaid-funded home care industry, leaving workers without jobs and patients without care.”

Kim’s report says that an industry built on underpayment of workers sets dangerous precedents for employees across the state.

“I’m not trying to destroy the market, but the market itself is not working for the end user,” Kim said.

A Moral Reckoning

While CPC’s workers wait for their recourse, other providers have been forced to pay hefty sums for violating various labor laws.

In 2020, the Visiting Nurse Service of New York paid $57 million to settle a lawsuit alleging the agency falsified time sheets and collected Medicare and Medicaid payments for services that weren’t provided. In November, the state attorney general and Department of Consumer and Worker Protection announced a settlement of as much as $18.8 million for some 12,000 workers who had been underpaid. And last month, a federal court approved a settlement for $600,000 against Scharome Cares, Inc., for unpaid wages, overtime, and damages and penalties.

As the cases against CPC wind through the court system, state legislators have proposed reforms to the state’s payment of workers.

In September 2019, Assemblymember Harvey Epstein and Sen. Roxanne Persaud announced legislation that would ban 24-hour workdays and cap workweeks at 50 hours. Last year, Assembly Health Committee Chair Richard Gottfried and Sen. Rachel May submitted the Fair Pay for Home Care Act, which would increase the minimum wage for home health aides to be 150 percent above the local minimum wage.

Lawmakers have also pushed to scrap the Medicaid spending limit, which has restricted the state’s health care policy since it was enacted in 2011.

“Home care is in crisis from poor pay, labor discrimination, and systematic underinvestment, as well as from COVID-19. Legislative solutions are needed, including my Fair Pay for Home Care bill raising wages and Assembly Member Harvey Epstein’s bill protecting workers against involuntary overtime through undercompensated 24-hour shifts … [and] repealing New York’s arbitrary Medicaid spending cap imposed by the previous Governor over a decade ago,” Gottfried said in an email statement.

But these bills won’t provide any recourse for Chu and Chan, who are awaiting checks from work performed years ago. Chu expressed hope that Gov. Kathy Hochul would take action to end the 24-hour workday. (Hochul’s office did not comment prior to publication.)

Epstein said that the passage of his bill depended on whether Gov. Hochul raises the global Medicaid spending cap.

“If we can end the 24-hour work rule, that’s really important, and the only question we have to answer at that point is once we stop it going forward, what do we do about compensation going back,” Epstein said, adding that both nonprofits and the government would have to help pay for years of back wages. “I think we need to have systemic solutions.”

With the 2022 elections looming, Kim’s focus on health care could turn the industry’s labor issues into a contentious topic for progressives.

Kim said he hopes the report will move discussion on home health aides forward from what he feels has been a circular conversation.

“I hope that they’ll recognize that there needs to be a moral reckoning of the care business model, that is failing our most vulnerable members,” Kim said, referring to his fellow legislators. “All we’re doing is covering up each others’ flaws and talking about prospective solutions of increased wages without addressing the broken system that’s exploiting the public benefits from inside.”

Democratic and progressive lawmakers were hesitant to comment on the issue. Prior to publication, the Prospect and New York Focus contacted a dozen state lawmakers to ask about working conditions in the home health care industry and allegations against CPC. Apart from Gallagher, Gottfried, Epstein, and Kim, none spoke on the record. (Some said that they hadn’t seen the report or hadn’t finished reading it.)

Kim acknowledged that the report challenged the typical political dynamics in Albany.

“There’s a synergy between nonprofit organizers who are wearing the progressive hats, who act as the gatekeepers of progressive movements, and the policymakers who think they’re the ones that give them the nod on progressive credentials,” Kim said.

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