GUEST POST: Wage Theft Quietly Becoming a Major Problem in Today’s Workplace

Today we have a guest blogger at The Employer Handbook. It’s Jesse Brar. Jesse is a Utah Employment Lawyer at Preston & Brar.

(Want to guest blog at The Employer Handbook? Email me).

Countless employees work hard on a daily basis in order to earn wages and salaries to support their families. Sadly, not all workers are getting a fair days pay for a fair days work that they render. Many of them are victims of wage theft, which has quietly become one of the major problems in the Country’s labor landscape.

There are many different forms of wage theft that many bosses, businesses and major corporations practice whether unintentionally or not.

Not paying the required minimum wage as set forth by the law. This is done by many companies by paying their workers on a piece work basis only. It turns out though that wages earned by the employees do not add up to meet the minimum wage.

Another form of wage theft is by depriving employees such as waiters and charter drivers from the tips that are given by their customers. Some companies only give out a percentage of the actual tip given, while some withhold the entire tip outright.

Yet another common method of wage theft is by misclassifying the employees as independent contractors, or promoting employees as managers and excluding them of overtime pay.

This labor problem in our Country is estimated to deprive billions of dollars in wages from millions of workers every year. Some of the common industries where wage theft abuses are prevalent are the service sector, the trucking industry, and the fast food and restaurant industry, just to name a few. Even white collar jobs are affected of this, too. Engineers, IT professionals, bank employees and other similar workers can also be victims of wage theft.

In a survey conducted on more than 4,000 workers in major cities such as Chicago, New York, and Los Angeles, wage theft abuses were found to be very common. The survey showed that 26% of low-wage workers were paid less than the minimum wage. Likewise, it was shown that 76% of workers, working more than 40 hours a week, were not given their overtime pay.

Our Country has laws which are intended to protect workers and employees, but sadly wage theft is becoming increasingly common today. There are many employees who try and complain to their bosses about wage theft abuses, only to get sent home and warned that any future complaints will get them fired. These kinds of situation are unfair and needs to be stopped.

The Department of Labor has been hindered by budget cuts to properly monitor and police these abuses in the entire Country. The high unemployment rate now is not helping the situation as well. Many workers are too scared to lose their jobs that they work tirelessly at, even if they are subjected to wage abuses. This widespread issue needs to stop, and asserting the right to get the salary and wages which are properly due should not be feared by workers but rather embraced.

The problem on wage theft is now being addressed across the country.

Many organizations and communities are ready to help in raising awareness to potential wage theft victims and even to business owners. There has also been an increase in campaigns to strengthen wage theft laws in many states and cities. The state of New York, has enacted state legislation to protect workers from wage theft, and Chicago, has enacted an ordinance that will strip employers and businesses of their license if they are found guilty of wage theft.

Although wage theft cannot be fully eliminated from any company especially among large-scale businesses, the best way to counteract this is by being aware that it exists. Employers need to avoid any form of wage theft issues with their workers so as not to jeopardize their company’s reputation. Implementing a strict rule about overtime works can be a good start. Perhaps a clearer job description regarding overtime pays is a great way to avoid wage theft issues, too.

The responsibility on wage theft problems need to come from both the employers and the employees.

A healthy working relationship is one of the most important keys to a successful business.