Wage Theft: Are You Truly Guilty?

There was a recent study published by the Economics Policy Institute, which stated that “employers short their employees $15 billion in wages per year”. In my opinion, I do not believe most employers are truly trying to cheat their employees out of their hard earned dollars. In fact, most instances of an employer not paying an employee all he or she is owed under the law results from a complex system of wage & hour laws (and constant changes to those laws) and not a malicious penny pinching employer who is intentionally stealing from their employees. Let me make it clear that I do believe there are some out there but those individuals make up a very small percentage.

Let’s discuss the term “wage theft.” The very terminology suggests an intentional taking of wages by an employer. Are there employees are who paid less than the wage to which the law entitles them? Absolutely. It can happen. The reason is simple, we have a wage-and-hour problem in this country. Wage-and-hour non-compliance, however, is a sin of omission, not a sin of commission. Employer aren’t intentionally stealing; they just don’t know any better. I have seen it over my years in the business.

And who can blame them? The law that governs the payment of minimum wage and overtime in the country, the Fair Labor Standards Act, is 70 years old. It shows every bit of its age. Over time it’s been amended again and again, with regulation upon regulation piled on. What we are left with is an anachronistic maze of rules and regulations in which one would need a Ph.D. in FLSA (if such a thing existed) just to make sense of it all. Since most employers are experts in running their businesses, but not necessarily experts in the ins and outs of the intricacies of the Fair Labor Standards Act, they are fighting a compliance battle they cannot hope to win.

As a result, sometimes employees are underpaid. The solution, however, is not creating wage theft statutes that punish employers for unintentional wrongs they cannot hope to correct. Instead, legislators should focus their time and resources to finding a modern solution to a twisted, illogical, and outdated piece of legislation.

Let’s face it we are nothing without our employees. Most scrupulous employers favor employees receiving a full day’s pay for a full day’s work (although there are some employees…). What employers and employees need, though, is a streamlined and modernized system to ensure that workers are paid properly.

The FLSA and various state laws (let’s not talk about California) are voluminous in nature. Adding to this complex web are Plaintiff attorneys who suggest that employers are all are cheating their employees especially when the wages are commissioned based. Not true in the overall scheme of things! Commission issues arises sometimes merely by oversight. Employers did not create this mess. Instead, let’s fix the cause of the problem—a baffling maze of wage & hour regulations be it the FLSA or a state promulgated law.

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