Tell Congress to stop the real steal before the House goes red! Corporations are robbing BILLIONS from their employees and now they want a tax break too!

At Ventura County’s monthly social justice fair, volunteer employment lawyers are kept busy talking to residents about wage theft. One attorney noted that despite all the GOP handwringing over street crime and demands for more street-level policing, wage theft by employers far outstrips other common forms of thievery

America’s corporations steal $50 billion a year from their workers. The GOP, who, despite their ludicrous claims to be the “party of workers,” protects these criminals with friendly legislation: reducing the power of unions, forced arbitration, redefinition of overtime eligibility and low fines for those caught. Trump’s Supreme Court piled on by making it harder for employees to bring collective action lawsuits to redress wage theft. This combines to make wage theft standard operating procedure for America’s largest companies.

And it’s not just workers who suffer. Wage theft also robs federal and state treasuries of many billions of dollars in taxes, and puts employers who play by the rules at a serious competitive disadvantage.

Before we let our legislators go home for the year, demand that after they raise or eliminate the debt ceiling, they pass H.R.7701/S.474 – Wage Theft Prevention and Wage Recovery Act so that Americans get paid a fair day’s wage for a day’s work. And instead of rewarding these grifting corporations with a tax cut (and the GOP legislators who serve them), demand that they start paying their fair share. (See original post on this here.)

Call/email action – Stop rewarding corporate thieves and price-gougers

Minimal script to your senators: I’m calling from [zip code] and I want Sen. [___] to stay in DC and spend every minute of available time working to RAISE or ELIMINATE THE DEBT CEILING NOW through budget reconciliation. Then, I want [him/her/them] to address the record levels of wage theft suffered by your constituents by passing S.4174 – Wage Theft Prevention and Wage Recovery Act and refusing to allowing corporations to weasel out of paying their fair share of taxes by raising, not cutting, corporate taxes. We know that Trump’s tax cut scam did not “trickle down” and we’re not falling for it again.

Minimal script to your representatives: I’m calling from [zip code] and I want Rep. [___] to stay in DC and spend every minute of available time working to RAISE or ELIMINATE THE DEBT CEILING NOW through budget reconciliation. Then, I want [him/her/them] to address the record levels of wage theft suffered by your constituents by passing H.R.7701 – Wage Theft Prevention and Wage Recovery Act and refusing to allowing corporations to weasel out of paying their fair share of taxes by raising, not cutting, corporate taxes. We know that Trump’s tax cut scam did not “trickle down” and we’re not falling for it again.

Deeper Dive

“If you steal from your employer, you’re going to be hauled out of the workplace in handcuffs,” said Kim Bobo, a Chicago workers rights advocate and author. “But if your employer steals from you, you’ll be lucky to get your money back.

What is wage theft? “Wage theft is a practice in which companies withhold their employees’ overtime pay, force off-the-clock work, violate minimum wage laws or steal tips. Victims of wage theft range from low-wage workers like cashiers, cooks and security guards to higher-paid positions such as nurses, pharmaceutical sales reps and financial advisors.”

“At Wells Fargo, aggressive sales quotas based on exploiting vulnerable customers forced me into 12-hour shifts with no breaks and no food allowed – and threats to withhold my paycheck if I didn’t sign off on working extra hours for free,” says Kilian Colin , who worked for the bank between 2013 and 2016 in southern California.”

How big is wage theft? In 2015, workers in LA lost $26.2 million in wage theft violations EVERY WEEK – that’s over $1.3 BILLION dollars a year taken from low-income workers, disproportionately harming women, immigrants and workers of color. In 2022, that estimate has risen to over $2 BILLION. And that’s just in just one city in America. It is currently estimated that nationally, employees steal over $50 BILLION DOLLARS in wages every year. “In the 10 most populous states in the country…2.4 million workers lose $8 billion annually (an average of $3,300 per year for year-round workers) to minimum wage violations – nearly a quarter of their earned wages.”

Small thefts add up: An employer who asks a minimum wage employee to work 15 minutes “off the clock” before and after an 8-hour shift each day is gaining a half hour of unpaid work. This represents a loss to the worker (and a gain to the employer) of around $1,400 per year, including the overtime premiums they should have been paid. If the employee is making $7.25 an hour, around $15,000 per year, this constitutes a theft of nearly 10 percent of a their annual earnings.

Why it matters: Even a 10% loss could mean the difference between paying the rent and utilities or risking eviction or the loss of gas, water, or electric service. “This form of wage theft causes many families to fall below the poverty line, and it increases workers’ reliance on public assistance, costing taxpayers money. Lost wages can hurt state and local economies, and it hurts other workers in affected industries by putting downward pressure on wages.“

Which states care about wage theft?: Only five states—Arizona, California, Florida, New York, and Oregon—and the District of Columbia have wage-theft-related retaliation protection laws.

CA’s new law – AB-1003 Wage theft: grand theft, makes wage theft a criminal offense. This law changes the definition of wage theft from a misdemeanor punishable by fines to include “grand theft” which is punishable by fines AND/OR imprisonment. Those affected are employers who steal amounts greater than $950 from any one employee, or $2,350 in the aggregate from 2 or more employees in any 12-month period, and it also includes “independent contractors” as employees. “The new law “allows us to aggregate the losses of multiple employees of the same company,” said Tanya Sierra, spokesperson for the San Diego County district attorney. “This would allow us to prosecute cases where an employer steals a little bit from many employees rather than a large sum from just one employee.”

”Unfortunately, CA’s Labor Commissioner’s Office is underfunded and short staffed, causing long waits, giving employers time to reincorporate themselves or otherwise duck punishment.

Who’s doing the stealing?

“Our findings make it clear that wage theft goes far beyond sweatshops, fast-food outlets and retailers. It is built into the business model of a substantial portion of Corporate America,” said Good Jobs First Research Director Philip Mattera , the lead author of the report.”

Major U.S. corporations such as Walmart, Hertz, Fed Ex, AT&T, Amazon, Halliburton, G4S Wackenhut and Circle-K stores are some of the worst offenders and many of whom are also GOP donors. Wage theft spans all professions, as financial institutions such as Bank of America, Wells Fargo, JP Morgan Chase and State Farm Insurance have paid fines too.(See a report here.) So it will be no surprise that the party of Trump, a serial wage theft violator himself, who pushed to gut regulations to discourage wage theft, whose Department of Labor wanted to allow employers to pocket ±$5.8 billion in tips every year from their workers, and whose Supreme Court picks stopped worker suits, would not be interested in passing H.R.7701/S.474 – Wage Theft Prevention and Wage Recovery Act, when they could more productively waste two years Benghazi-ing Hunter Biden’s laptop.

Speaking of absurd, one serial offender was just in the news, promising to raise prices or close stores to deal with retail theft!

What about small businesses? Republicans’ also pretend to love small businesses, but they keep proposing corporate-friendly joint employer liability release legislation, which forces wage theft and possible prosecution down the chain. The GOP’s H.R. 3441 – Save Local Business Act of 2017-2108, has been reincarnated into 2022’s versions – H.R.3185/S.3485, “Without the threat of joint employer liability, large corporations can use their economic power to shift all the risk of compliance onto smaller firms that they do business with.  As large firms drive margins down further and further, the small contractors feel pressure to cut  corners at the expense of workers.  Too often, the result is that workers are victims of wage theft.  The only hope of reducing that downward pressure on small business owners and workers is if large lead firms have some realistic fear that they will be held accountable when, for example, they pay their contractors so little that wage and hour violations are inevitable.  But, that’s not a message the Republican donor class wants to hear.” Interests of small business and workers are actually aligned here. Workers don’t want to be stolen from and small businesses don’t want to be forced into it, or the subsequent legal actions.

Would the federal legislation interfere or reduce the effect of new CA labor laws?

A federal law would extend wage theft protections to those in the 45 states without such laws now. Our question was whether the language of the federal law would reduce our own laws. An employment lawyer answered: The federal version does not go far enough because California has already raised the floor on each item included in what HR7701/SB474 aims to do. Federal laws set the floor and state laws are free to raise that floor.  Fortunately, for us, our California government, appeals courts, and state supreme court have definitely raised the federal floor when it comes to Labor and Employment Law.

Wage Theft Prevention and Wage Recovery Act 

This bill requires employers to:

1.     make initial and modified disclosures to employees of the terms of their employment,

This has already been the law in California for more than 10 years.  See the Wage Theft Protection Act of 2011, specifically Labor Code section 2810.5. See: https://www.dir.ca.gov/dlse/governor_signs_wage_theft_protection_act_of_2011.html

2.     provide such employees with regular paystubs, and make a final payment to an employee for uncompensated work hours within 14 days of the employee’s termination. 

These protections have already been provided to California employees under more specific and favorable terms per Labor Code sections 226 (pay stubs) and 203 (waiting time penalties). See: https://www.dir.ca.gov/dlse/faq_paydays.htm and https://www.dir.ca.gov/dlse/faq_waitingtimepenalty.htm

3.     Employers must also allow employees access to wage records. 

These protections have already been provided to employees per Labor Code sections 1198.5 (personnel records) and 226 (payroll records) and the IWC Wage Orders, too. See: https://www.dir.ca.gov/dlse/faq_paydays.htm

4.     An employer must compensate an employee at the rate specified in an employment contract, including a collective bargaining agreement, that specifies a rate of pay higher than the minimum wage rate. 

This language would fall under Labor Law not Employment Law. 

5.     The bill makes all of such unpaid wages recoverable through civil enforcement.

Civil enforcement is already what the law provides in California.  In California we also have the Private Attorney General Act (PAGA), which is an incredible civil weapon so wealthy employers-wealthy defendants-and-conservatives have been trying to chip away at PAGA for over a decade now.  Local criminal enforcement by the DA would be even better!

6.     The bill establishes new and increased civil and criminal penalties for violations of overtime or minimum wage requirements, including referral to the Department of Justice for criminal prosecution of employers who engage in wage theft, falsification of wage records, or retaliation against employees. 

This is not bad, but it’s too general and, again, local criminal enforcement by the DA would be even better.  We can now do that in California per Penal Code § 487m.

7.     The Wage and Hour Division of the Department of Labor must provide grants to specified organizations, including nonprofits and educational institutions, to enhance the enforcement of wage and hour laws. 

Hmmm, government grants for “specified organizations, including nonprofits and educational institutions…”  There’s actually some incredible organizations in California doing great work on wage and hour law out there but I would look out for embezzlement.  

8.     The Government Accountability Office must study and report on successful grant programs.

Exactly, the GAO must look out for embezzlement.  Unfortunately, this little clause can also be politicized depending on which political party has oversight control.

Resources

• (Wagetheftisacrime.com) Wage theft is a crime.
• (Calmatters) Though wage theft is a crime, few California DAs file charges for it
• (Calmatters) When employers steal wages from workers
• (Calmatters) A (CA) Workers’ Guide to Wage Theft: What to do if your boss steals your wages
• (U.S. Sen. Committee on Health, Education, Labor & Pensions) Murray, DeLauro, Scott Introduce Bill to Stop Wage Theft and Improve Wage Recovery
• (goodjobsfirst) Grand Theft Paycheck: The large corporations shortchanging their workers’ wages.
• (goodjobsfirst.org) Report: Wage Theft is Pervasive in Corporate America. Wage Theft is Pervasive in Corporate America; Big Banks, Insurers are Among Most-Penalized Firms
• (commondreams.org) Jaw-Dropping’ Report Reveals Rampant Wage Theft Among Top US Corporations
• “Wage theft goes far beyond sweatshops, fast-food outlets, and retailers. It is built into the business model of a substantial portion of corporate America.”
• (ed.labor.house.gov) Wage Theft Prevention and Wage Recovery Act of 2022 (H.R. 7701) Section by Section.
• (epi.org) Two billion dollars in stolen wages were recovered for workers in 2015 and 2016—and that’s just a drop in the bucket
• (inthesetimes) For Big Corporations Like Walmart, Wage Theft Penalties Are Just the Price of Doing Business
• (epi.org) Employers steal billions from workers’ paychecks each yearSurvey data show millions of workers are paid less than the minimum wage, at significant cost to taxpayers and state economies
• (Salon) For big corporations, wage theft penalties are the price of doing business. Corporations, like Walmart, are guilty of being repeated wage theft offenders.
• (Salon) How corporations get away with rampant wage theft. Pay violations are becoming more widespread in low-wage industries — despite enforcement efforts.
• (cbs) U.S. companies are stealing pay from low-wage workers, report says
• (cbs) Investigating Wage Theft in California. How you might be affected
• (cbs) Amazon accused of stealing tips from delivery drivers.
• (minnesotareformer.com) MN Senate Republicans push for limiting wage theft penalties
• (people’sworld) Joint Employer bill: Republicans say nobody’s responsible for wage theft
• (theHill) Trump’s Labor Department walks away from wage theft
• (USAToday) USA TODAY exclusive: Hundreds allege Donald Trump doesn’t pay his bills
• (NELP) WHO’S THE BOSS? HOUSE REPUBLICANS WANT TO HELP EMPLOYERS DODGE RESPONSIBILITY FOR HARMING WORKERS
• (Business & Human Rights Resource Centre) Supreme Court upholds agreements that prevent employee class-action suits
• (CREW) Corporations have given $40 million to the Sedition Caucus
• (EPI) Employers would pocket $5.8 billion of workers’ tips under Trump administration’s proposed ‘tip stealing’ rule
• (NELP) EXPOSING WAGE THEFT WITHOUT FEAR IS POSSIBLE AND NECESSARY
• (theHill) House GOP: Standing with wage thieves
• (Workday) GOP blocks vote that would preserve overtime pay
• (Huffpost) Florida Wage-Theft Laws Could Be Blocked By GOP Bill
• (onlabor.org) Another Phony GOP House Labor Hearing
• (publicjustice.net) A victory against wage theft and for class actions in Braun V. Walmart
• (workdaymagazine.org) GOP blocks vote that would preserve overtime pay.
• (OnLabor) Another Phony GOP House Labor Hearing