Report: Employers Stole Billions From Low-Wage Workers

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Employers are stealing billions of dollars in wages from some of the country's lowest-paid workers.

A Dec. 13 Economic Policy Institute report found private lawyers and government agencies managed to recover nearly $2 billion in stolen wages from employers in 2015 and 2016, according to CNN. And according to the report, that amount was merely a fraction of earned wages not paid to employees.

Wage theft by employers can take a number of forms, including failing to pay overtime, requiring employees to work longer hours than their paid shift or deducting from workers' paychecks so they are making below the hourly minimum wage.

Wage theft is reportedly widespread in the construction, retail and restaurant industries. These industries often employ undocumented immigrants who are especially at risk to having their wages stolen, as they may be scared of their status being reported if they complain.

EPI complied a number of state wage theft settlements and determined different states had recovered varying amounts of lost wages for employees.

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California, which recovered almost $117 million in 2015 and 2016, leads the way, followed by New York, which recovered $84.6 million.

California regulations require employers to notify employees of their rights by issuing them a notice with their pay rate and a method for contacting officials if their paycheck is less than the rate they should have earned.

"Employers are under a tight squeeze and looking for different ways to save money," said Cynthia Hernandez, who co-authored another report with similar findings from the Research Institute on Social and Economic Policy at Florida International University. "Some are using wage theft as a business model to cut costs."

Jose Lopez, a cook at a restaurant in Mission, Texas, had often worked 70-hour weeks over the course of 10 years to support his family, Facing South reports. He only learned he was entitled to overtime pay when working more than 40 hours a week after the U.S. Department of Labor conducted a random inspection of the restaurant where he worked.

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Lopez said when he told his boss he was legally entitled to overtime pay, he was fired.

Lopez filed a lawsuit with Texas RioGrande Legal Aid, and a jury awarded him nearly $85,000. Lopez, his wife and his daughter were killed in a car accident before they would see the money.

The restaurant owner still refused to pay Lopez after the judgment, and attorneys, with the marshal's office, closed the restaurant down and seized the property until the stolen wages were paid to Lopez's orphaned children.

Kim Bobo, the author of "Wage Theft in America" and the executive director of Interfaith Worker Justice in Chicago, said workers needed long-term solutions to prevent wage theft.

"We need the ethical business community to step up and demand a level playing field," explained Bobo. "If you are paying employees fairly, and the guy down the street, your competitor, is practicing wage theft, it is hurting you. It steals from the workers, and it steals from the public coffers."

Sources: CNN, Economic Policy Institute, Facing South / Featured Image: Nic McPhee/Flickr / Embedded Images: Hometown Beauty/FlickrDave Dugdale/Flickr via Fast Company

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