Looking for wage theft in Pennsylvania hotel industry

The Lincoln Motel failed to pay employees minimum wage and overtime, the U.S. Labor Department said.
The Lincoln Motel failed to pay employees minimum wage and overtime, the U.S. Labor Department said. (LAURENCE KESTERSON / Staff Photographer)
Posted: June 28, 2011

Constant drama at the Lincoln Motel, just over the Philadelphia border on Lincoln Highway:

Thomas James "Tom Thumb" Campbell, a member of the Pagans motorcycle gang, had a room at the Lincoln when he killed an Upper Darby police officer in 2002.

Police nabbed Manny Duran, accused of running one of the most notorious drug rings in the city, at the Lincoln, in Trevose. When they caught him, he was packing a .40-caliber.

Ligaya Sitrum, 51, a housekeeper doubling as a front-desk clerk, caught the everyday dramas.

She cleaned up after the fights, the suicides, and the "15-minute guests," who didn't bother to slip between the sheets. Instead, if they were tidy, they just spread a towel on the bedspread.

"This is a dump," she said, "and the people who come in here are nasty people."

And so, in her opinion, is motel owner Jyoti Panwala, who had not paid Sitrum and 11 other employees a total of $6,373.55 for unpaid wages, the U.S. Department of Labor said. The motel failed to pay minimum wage and overtime.

U.S. Labor Department officials and investigators from around Pennsylvania are meeting in State College on Tuesday, Wednesday, and Thursday to talk about how to tackle what they see as a serious problem - wage theft in Pennsylvania's hotel sector.

For three years, until September 2010, the U.S. Labor Department conducted 165 wage investigations at Pennsylvania hotels. Owners owed $366,000 to 900 workers.

"Based on my years of experience, that's eye-opening to me," said Alfonso Gristina, director of the Wage and Hour Division's Wilkes-Barre district office. He is overseeing the department's statewide effort, which began Oct. 1.

Hotel employees fit the profile of workers vulnerable to wage theft, say academics who study the subject. They may be uneducated or recent immigrants who are either unfamiliar with their rights or too intimidated to protest.

Pennsylvania's situation isn't unusual - it's just a matter of what each office sees as a priority, Gristina said.

Since the initiative began, the department has conducted random checks of 60 hotels, most in the low-cost sector. One in four was found in violation, with $198,542 in wages due to 72 employees. The investigations look back three years.

Leeann MacWilliams, executive director of the Pennsylvania Tourism and Lodging Association, said that when the association learned of the initiative, it asked the Labor Department to hold a training for association members.

Some issues are tricky, she said. In small hotels, an employee might work one day as a bartender and the next day as a front-desk clerk. Different rules involving tipping can lead to wage errors.

"When it's a family business, you don't have an H.R. person," MacWilliams said. Some hoteliers may be dishonest, but most mistakes can be traced to ignorance.

"That can happen in any industry, but you need to do right for the employee."

In State College, Gristina and his colleagues will be trying to figure out how to get most hotels into compliance. While responding to individual complaints (the "whack-a-mole" approach, as he describes it) helps workers, it won't solve systemic abuses.

It is likely, he said, that the focus will shift toward hotel-management companies that operate multiple properties.

At the Lincoln, Panwala said Sitrum had been a problem employee, but even so, she has been paid.

"As soon as they told me, I paid not only her, but I paid everybody," Panwala said. She said she didn't know the minimum wage had increased.

Looking back, Sitrum, who is now job-hunting, said she should not have believed Panwala's promises to make good on her pay. Luckily, Sitrum, of Northeast Philadelphia, had kept every pay stub, so it was easy for the Labor Department to prove her case. Sitrum has been paid but most of her coworkers have not, the Labor Department said.

"I'm gullible," Sitrum said. "I was desperate for work and she knew it and she was stingy."

Contact staff writer Jane M. Von Bergen at 215-854-2769 or jvonbergen@phillynews.com.