By Blaine Stum
When most of think about theft, we think about people stealing a car for a quick joyride, or someone breaking in to our home when we are away to take the new flatscreen in the living room. To a degree, it’s understandable why we focus on these images so much: they often involve an invasion of privacy in places we consider safe, and the property that is stolen can be of substantial worth. Few of us would advocate that these thefts not be treated as crimes (although we may differ on how the suspect should be treated). Yet, the disproportionate focus on these sorts of crimes does a disservice to everyone, because it shields other perpetrators of theft from justice. Welcome to the curious case of wage theft.
Broadly defined, wage theft is the illegal withholding of wages that are rightfully owed to an employee. Wage theft takes many forms: employers not paying workers minimum wage, employees being denied breaks, employers not paying employees overtime pay or misclassifying an employee so you can pay them less. Studies and surveys show that wage theft is shockingly widespread. A 2008 survey of over 4,000 law wage workers in major cities across the country found that over two thirds had experienced one pay-related violation in the previous week. Earlier surveys and audits found similar results. An audit of the restaurant industry by the Department of Labor found that only 28 percent were in compliance with the Federal Labor Standards Act. A 2001 audit found that 60 percent of nursing homes and 100 percent of poultry processing plants were out of compliance for violations ranging from not paying employees overtime to meal-break violations. People of color, especially African Americans and Latinos, have been found to be especially vulnerable to wage theft. In the 2008 survey, African Americans experienced minimum wage violations at a rate triple that of their white counterparts. A study by Mehta et al (2002) found that Latino immigrants also experienced minimum wage violations at three times the rate of other demographics.
All told, the Economic Policy Institute estimates that wage theft costs employees more than $50 billion a year. To put that in perspective: the FBI estimates that the total value of property stolen or damaged in reported robberies, burglaries, larcenies and motor vehicle thefts was $14 billion in 2012. Yet we handle these crimes much differently both federally and locally, despite the penalties prescribed for wage theft in many statutes. In Washington State for instance, the Department of Labor and Industries is the primary agency that investigates allegations of wage theft, of which there are 3,500-4,000 every year for only 16 investigators. If an investigation turns up evidence of wage theft, L&I is permitted to collect wages. If employers refuse, they can issue citations but their success rate for collections post-citation is below half. This is why an Investigate West analysis found that nearly $9 million in wages owed had yet to be collected. Complainants are free to pursue civil cases in court if none of this works of course, but most cannot afford this and lawyers are highly unlikely to take a case that does not involve a substantial amount of money. Criminal cases are even more unlikely in part due to a lack of political or institutional support.
Contrast our weak response on wage theft to our response to other property crimes: Gov. Jay Inslee seated a task force on property crimes in Washington State to make recommendations on lowering recidivism. Their recommendations were included in the governor’s budget proposal. A wage theft task force with budget recommendations you say? Nowhere to be found.
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