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Photo of Michelle Cohen Levy

How common is wage theft?

On Behalf of | Jun 11, 2024 | Employment Law |

It’s important for both employees and employers to understand that wage theft sometimes happens and that it is a violation of the employee’s rights. Often, employees in this position feel rather powerless. They know that they deserve to be paid more, but they’re not sure what steps to take. 

One important thing to note is that wage theft is a massive issue in the United States. The Economic Policy Institute claims that around $50 billion is taken from workers every single year. This is more than the combined total of all other types of theft or robbery in the country. Why is it so incredibly common for businesses to essentially steal from their own employees?

It happens in many different ways

Part of the issue is that wage theft happens in a lot of different ways, and it can even happen unintentionally.

For example, say that an employee works two overtime hours. They should be paid time-and-a-half, but they are only paid at their standard rate. Or, perhaps they are offered comp time and given two hours off, even though they deserve three hours. This is a form of wage theft.

Another example is if a business owner requires employees to pool tips and then includes themselves in the pool. Starting a tip pool itself is not illegal, but when an employer, manager or supervisor begins to take a portion of those tips, it is another example of wage theft.

What should be done?

For employers, the key is to set up policies and business practices to avoid wage theft whenever possible. For employees, it’s most important to recognize that this does happen and that there are legal steps that can be taken to reclaim the money that is owed.