IR #2012-39
August 16, 2012

Dean Fryer
Erika Monterroza
(510) 286-1161

Twitter @CA_DIR

Underground economy focus of DIR's Labor Enforcement Task Force Advisory Committee

SACRAMENTO –The Department of Industrial Relations (DIR) on Wednesday engaged industry and labor in an in-depth discussion about California’s persistent underground economy, which negatively impacts both employers and workers across the state and across industries.

A diverse group of employers and worker representatives attended the Labor Enforcement Task Force (LETF) Advisory Committee at the Elihu Harris State Office Building in Oakland. The focus of the meeting was to listen to the experience of the communities that are most directly affected by the underground economy.  A strategic education and outreach plan will be formulated from this discussion to educate workers on their rights and employers on their responsibilities.  Additionally, ideas on enforcement were discussed such as where to find the egregious actors and what needs to be done to eradicate the underground economy. Members of the advisory committee discussed ideas Wednesday about how to increase compliance to state laws and reduce the reach of the underground economy. Plans were also made to foster community partnerships, such groups can help identify where abuses occur.

“The advisory committee meeting revealed that all involved had the same goals in addressing the problems of the underground economy, which is to provide protections for vulnerable workers and a fair competitive market for businesses to flourish in,” said DIR Director Christine Baker. “The underground economy not only impacts workers and businesses but also the state economy with an estimated $6 -12 billion lost in tax revenue each year.”

LETF comprises state, federal, and local agencies that enforce labor, tax and consumer protection laws, including DIR’s Division of Labor Standards Enforcement (Labor Commissioner) and Cal/OSHA, as well as the Employment Development Department, Contractors’ State License Board, Board of Equalization, Alcohol and Beverage Control and the Bureau of Automotive Repair. Additional information on LETF is available on DIR’s website.

Information on businesses operating in the underground economy and reports of labor law violations can be made to LETF by e-mail at or by calling the LETF toll-free hotline at 1-855-297-5322.

The Department of Industrial Relations was established to improve working conditions for California's wage earners, and to advance opportunities for profitable employment in California. DIR is a department within the Labor and Workforce Development Agency.

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