Wage theft costs workers billions of dollars every year in the United States. Minimum wage violations in California and New York amount to an estimated $1.6 billion–$2.5 billion over the course of a full year according to a study prepared for the U.S. Department of Labor.
The study, entitled “The Social and Economic Effects of Wage Violations: Estimates for California and New York,” only reported minimum wage violations, leaving out other forms of wage theft. Wage theft can be carried out by many means: failure to reimburse business-related expenses, employee misclassification, failure to pay overtime, illegal paycheck deductions,working off the clock or not being paid at all.Wage theft costs workers billions of dollars every year in the United States. Minimum wage violations in California and New York amount to an estimated $1.6 billion–$2.5 billion over the course of a full year according to a study prepared for the U.S. Department of Labor.
The fact that not all instances of wage theft are reported or documented and that California and New York make up less than 20 percent of the population, it can easily be surmised that wage theft can potentially reach into the tens of billions.
Because wage theft goes mostly unreported the exact number is hard to figure out, but it is important to know that it is very prevalent all over the country. In fact, according to a study by the Economic Policy Institute, minimum and low wage workers are robbed more than banks, convenience stores, and gas stations combined.
Immigrants are three times as likely to suffer from wage theft from an employer. It is not surprising that immigrants are targeted more by thieving employers considering that immigrants who are undocumented have very little legal rights and are constantly under the threat of arrest and deportation.
Another factor that is hardly ever considered and hard to calculate is discrimination in the workplace. Instances where women are paid less than male workers for the same job can be compounded if the woman is also Black, Latina, Native American, or LGBTQ, and so on.
A 2009 study by the National Employment Law Project found that 19 percent of low wage workers were robbed of overtime pay.
Calculating potential wage theft by considering all of the factors listed above, as well as the potential unreported cases, lost wages can easily surpass $50 billion a year.
In Albuquerque, workers at Kellys Brew Pub have filed a class action lawsuit after servers at the restaurant were forced by their bosses to pay Kellys back 2 percent of their daily sales, plus $3 per hour that they worked on the clock. Many were also cheated of overtime pay by working off the clock.
Workers at Kellys who did not make enough during their work day were forced by the bosses to pay the difference out of pocket or it was illegally deducted from their paychecks.
The owners of Kellys violated the city’s Minimum Wage Act, but the owners now plan to sell the company to Santa Fe Dining, possibly to get out of paying their employees their due wages.
Many of those who are active in the Fight For $15 struggle and those who have been fighting for the rights of workers will likely not be surprised at the figures and facts of wage theft. That is why they are out in the streets fighting back against the institutionalized greed of the bosses. Fighting back is what it takes for there to be any real change.
