States Get Tough on Wage Theft

Weekly time sheet.
By Richard Dahl on August 22, 2019 9:54 AM

Many employers think they can easily get away with robbing their own workers. It’s called “wage theft,” it’s pervasive, and several states have recently decided to make offenders’ lives more miserable.

Those workers who have been victimized by wage thieves are familiar with the tactics used by these employers to keep more money for themselves: They don’t pay overtime, avoid providing benefits by classifying workers as independent contractors, pay less than minimum wage, or fail to reimburse workers for necessary expenses.

In 2017, the Economic Policy Institute released a report which found that American employers are stealing about $15 billion from workers’ paychecks every year. That study, along with various other reports of growing abuse, has resulted in calls for reform.

Placing More Teeth into the Law

In recent months, three states have responded by passing laws designed to rein in the employer thieves:

  • In May, Colorado passed a law that made wage theft a felony when the amount is greater than $2,000.
  • On Aug. 1, Minnesota took the toughest stance in the country on wage theft when it also criminalized the offense and set down a fine schedule of up to $35,000 and prison sentences of up to 20 years.
  • A week later, New Jersey passed a similar law requiring that multiple offenders with a “pattern of wage non-payment” can land a three- to five-year prison term and fines of up to $15,000.

At times, particularly egregious wage theft captures news headlines. In June, a construction company owner in California was sentenced to eight years in prison and ordered to pay a fine of $919,000 following his conviction on charges of forced labor. The man, Job Torres Hernandez of Hayward, California, recruited undocumented workers from Mexico, held them captive in squalid living conditions, refused to pay them, and threatened them with deportation.

But Convictions Are Rare

As a recent article in the Yale Law & Policy Review points out, “the odds of getting convicted for committing wage theft are similar to the odds of getting hit by lightning.” The reason: A lack of investigators at both the state and national levels. Most enforcement occurs following complaints by workers, but “workers who are the most likely to suffer from wage theft are the least likely to come forward to report a violation because they lack information about their rights, access to legal advice and counsel, time and resources to pursue a complaint, and the economic security necessary to risking complaining.”

If you believe that you have been victimized by wage theft, however, there are steps you can take to report it. You may file a complaint by mail or in person at the U.S. Labor Department’s Wage and Hour Division or at your relevant state agency that handles wage and hour complaints. You may also contact a skilled employment attorney to discuss your situation.

Related Resources