Over 90% Of Employees Are Having Their Wages Stolen

by / November 4, 2014 News 14 Comments

April V. Taylor

Some may wonder how America can be the richest country in the world but still have so many of its citizens be classified as the working poor; the answer is simple: wage theft.  Nearly every person who falls at the bottom 95 percent of income distribution in the United States is having some portion of their wages stolen.  In some cases, such as that of undocumented immigrant day labors, the theft is literal and direct with contractors refusing to pay workers after they have completed a job.  Many undocumented workers fear of being reported to U.S. Immigrations and Customs Enforcement (ICE) prevents them from having much recourse.

For workers who are documented, the theft is more subtle.  One example is fast food workers who work overtime but are not paid the mandatory time-and-a-half wage required for overtime hours by law.  Well known franchise restaurants such as McDonald’s, Burger King, Pizza Hut, and Wendy’s steal overtime pay from employees by editing documentation of hours to make it appear as though the hours were not overtime.  It’s not just fast food workers who face wage theft; Amazon recently faced a class action lawsuit because it made employees line up for 25 minutes at the beginning and end of shifts and lunch breaks to pass through security.  The Supreme Court will make a decision about whether or not this type of loss prevention effort will be allowed to become legalized wage theft.

A research report entitled Broken Laws, Unprotected Workers studied wage left for low-wage workers in New York, Chicago and Los Angeles and found that, “The average worker lost $51, out of average weekly earnings of $339.”  This added up to an annual loss of $2,634, which amounted to a theft of 15 percent of a workers earnings.  According to estimates by The Economic Policy Institute, this amounts to more than $50 billion a year in the United States. To put this in perspective, this is more than the $13.6 billion in theft of stolen cars, other larcenies and burglaries and robberies reported to the FBI in 2012.  For those who think that paying low-wage workers a living wage is not feasible, the amount of wage theft would actually cover raising the wage to $20 for more than 1.2 million jobs.

For those who feel that wage theft does not apply to them because they are not low wage workers, one only has to look at productivity.  Since the 1970s, despite productivity doubling, real wages for the majority of Americans have stagnated. Increased productivity allows employers to raise wages without harming profits, but rather than increase pay, the money has been siphoned off.  Deregulation has allowed Wall Street to pocket this money that should be going to the American worker who is working harder but not reaping the benefit.