‘I have not seen one cent’: billions stolen in wage theft from US workers | US unions

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Employees across the country are not getting paid what they’re owed, and critics say government is toothless to help

Jose Martinez worked for a construction contractor in New York City for six months in 2019 when he and his co-workers suddenly stopped getting paid.

Martinez said the contractor, Star Builders, initially blamed the owners of the building for not dispersing money for the project.

Martinez said he and his colleagues were eventually paid late, but the delays kept happening. The contractor came up with more excuses for the lack of payment. Eventually Martinez and several of his co-workers left after not getting paid for four weeks of work.

“I have not seen one cent from that money that is owed yet,” added Martinez, who filed a wage theft claim with the New York state labor department in 2019 with assistance from the non-profit Make the Road New York.

“It affected me a lot because at the time, I had to start finding other work, I had to pay bills and pay rent and I didn’t have money, so I had to get loans that I eventually had to pay back once I got another job.”

The contractor, Star Builders, did not respond to multiple requests for comment.

Martinez is far from alone.

Workers in the US have an estimated $50bn-plus stolen from them every year, according to the Economic Policy Institute, surpassing all robberies, burglaries and motor vehicle thefts combined. The majority of these stolen wages are never recovered by workers.

Between 2017 to 2020, $3.24bn in stolen wages were recovered by the US Department of Labor, state labor departments and attorney generals, and through class- and collective-action litigation.

Wage theft disproportionately affects lower-wage workers, women, people of color, and immigrant workers, and negatively affects local economies and tax revenues.

There are numerous forms of wage theft, from employers not compensating workers for time worked, violating minimum wage and overtime laws, misclassifying employees as independent contractors, not providing legally required meal breaks, confiscating worker tips, or illegally taking deductions from worker wages.

Wage-theft violators include some of the largest employers in the US; Amazon paid $18m in November 2022 to settle a wage-theft class-action lawsuit in Oregon, the largest in the state’s history, and paid a $61.7m fine in 2021 over allegations of stealing tips from Amazon Flex drivers.

According to a 2018 report by Good Jobs, between January 2000 to 2018, Walmart paid over $1.4bn in fines and settlements over wage theft violations, FedEx paid over $500m during the same period, and Bank of America paid over $380m.

Construction contractors have a notorious reputation for wage-theft violations, often affecting immigrant workers, and exploiting loopholes to avoid paying wage-theft claims, such as shutting down businesses and reopening under a different business filing.

Martinez wants to warn others in the sector.

“People need to be very careful with contractors, because they always say, ‘We have a lot of work for you to do’ to keep you there. They would say, ‘It’s just a matter of time, we just have to wait for the payment, it’s going to be OK,’ and so they’re always talking that way to keep people working there,” said Martinez.

“Workers shouldn’t let more than one week go by without getting their payment because they’re always going to come up with some excuse.”

Despite the state of New York’s worker protections and laws aimed at curtailing wage theft, the Center for Popular Democracy estimated in 2019 that wage theft may impact 2.1m workers in New York every year, exceeding $3bn annually.

Goma Yonjan Gurung has worked as a nail technician in the New York City area for 25 years, an industry where wage theft is rampant and scantily enforced. A February 2020 report by the New York Nail Salon Workers Association noted 82% of workers reported experiencing wage theft at an average amount of $181 per week.

“Even though the government says the minimum wage is $15 an hour, what I know is it’s not happening for many nail technicians, including myself. In some places they pay as low as $10 an hour,” she said. “The government in the past has passed bills mandating minimum wage or time off, but what happens is it is not implemented or being practiced by employers.”

Worker advocates have criticized the state’s labor department for lack of enforcement of wage-theft violations and not recovering stolen wages from employers.

Other states, such as Florida, do not have a state labor department to oversee the third largest workforce in the US, leaving workers with fewer options to try to recover stolen wages.

A bartender in Orlando, Florida who requested to remain anonymous because they still work in the industry, said they started a new bartending job in May and pushed back when they found out their hourly wage was just a daily rate of $30, despite working eight-hour shifts.

“I reminded my manager that paying less than minimum wage was illegal, and added a link to a law firm’s page about it. He fired me,” the worker said. “Getting fired for not wanting to be paid below the already insanely low minimum wage after working in the industry for over 20 years was pretty rough.”

The worker attempted to file a complaint with the US Department of Labor and the Florida attorney general’s office but was told they only prioritize higher wage violations and never heard back after being told someone would follow up.

Rodrigo Camarena, director of the Justicia Lab, an advocacy group, said: “The process for filing a wage-theft complaint form is very onerous and cumbersome, so there’s an immediate obstacle in the process itself. But once that form is filed, it takes months if not years for the department of labor to even investigate it.” The Justicia Lab recently launched a digital tool, ¡Reclamo!, for workers to file wage-theft claims.

Camarena said: “In the meantime, that person is going without that income that they earned potentially, and the employer isn’t being penalized in any way, so there’s a delay in enforcement and then the enforcement process also isn’t as thorough as it could be.”

New York legislators and worker groups have been pushing to pass the Securing Wages Earned Against Theft (Sweat) Act to enforce New York’s wage theft laws and make it more difficult for employers to avoid accountability for wage theft violations.

“There needs to be more work at the state level, that not just holds individual employers accountable but to really hold industries accountable that are problematic and root out the ways employers get out of paying wages owed,” added Camarena.

“We need to ensure that worker rights are protected in all cases, because ultimately this issue is about the dignity of everyone.”

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