More than $3 billion in stolen wages was recovered for workers from 2017 to 2020 by the U.S. Department of Labor, state agencies, and class action litigation, according to a new EPI report.
This staggering amount represents just a small portion of wages stolen from workers across the country: Federal and state recovery continues to fall short of what’s necessary, and the vast majority of workers will never file a claim to recover stolen wages. While wage theft impacts workers broadly, it disproportionately affects low-wage workers, many of whom already are struggling to make ends meet. Wage theft also disproportionately impacts women, people of color, and immigrant workers because they are more likely than other workers to be in low-wage jobs.
Wage theft can take many forms, including paying workers less than the minimum wage, not paying overtime premiums to workers who work more than 40 hours a week, or asking employees to work “off the clock” before or after their shifts.
“The rise in inequality over the past four decades has been compounded by wage theft, which robs millions of workers of billions of dollars from their paychecks each year. When employers withhold pay from their workers, they also hurt local economies and incur costs to taxpayers. Wage theft devastates individual workers, their families, and their communities,” says Ihna Mangundayao, policy assistant at EPI and co-author of the report.
The authors of the report offer a variety of potential solutions to combat wage theft. This includes increasing funding for enforcement agencies, enacting higher and meaningful civil monetary penalties (CMPs) to deter violations, and protecting workers’ right to collective action, as union workers are less likely to experience wage theft because they have the bargaining power to establish mechanisms to combat the practice.