What is wage theft?

Wage theft is the illegal withholding of wages or the denial of benefits that are rightfully owed to an employee. Wage theft, particularly from low wage legal or illegal immigrant workers, is common in New York. Wage theft can be conducted through various means: overtime, minimum wage violations, employee misclassification, illegal deductions in pay, working off the clock, not being paid at all.

Documentation

Often theft of wages is combined with failure to document what was paid by giving the employee an earnings statement which specifies the hours worked, the rate of pay and total amount of pay for the period. This may be combined by payment in cash or personal check.

Overtime

According to the the New York Labor Code, unless exempt, employees are entitled to receive overtime pay calculated at least time and one-half times pay for all time worked past forty hours a week. Some exemptions to this rule apply to public service agencies or to employees who meet certain requirements in accordance to their job duties along with a salary of no less than $900 a week. Despite regulations, there are many employees today who are not paid overtime due them.

Minimum Wage

In 2009, reform placed the new federal minimum wage at $7.25. Beginning December 31, 2013, New York State’s minimum wage will increase in a series of three annual changes as follows:

  • $8.00 on 12/31/13
  • $8.75 on 12/31/14
  • $9.00 on 12/31/15

Misclassification

Misclassification of employees is a violation that leaves employees very vulnerable to other forms of wage theft. Under the FLSA, independent contractors do not receive the same protection as an employee for certain benefits. The difference between the two classifications depends on the permanency of the employment, opportunity for profit and loss, the worker’s level of self-employment along with their degree of control. An independent contractor is not entitled to minimum wage, overtime, insurance, protection, or other employee rights. Attempts are sometimes made to define ordinary employees as independent contractors.

Illegal Deductions

Employees are subject to forms of wage theft through illegal deductions. Trivial to sometimes fabricated violations in the workplace are used to validate deductions. Any deduction that brings an employee to a level of compensation lower than minimum wage is also illegal. Employers are required to issue employees documentation of deductions along with earnings. Failure to issue this documentation is generally prevalent in working places subject to wage theft.

Full Wage Theft

The most blatant form of wage theft is for an employee to not be paid for work done. An employee being asked to work overtime or working through breaks without pay is being subjected to wage theft. In the most extreme cases, employees report receiving nothing. In some cases, the legal status of the workers can enable employers to withhold pay without fear of facing any consequences.

Other Forms

Putting the pressure on injured workers to not file for workers’ compensation is frequently successful. Employees are often confronted with threats of firing or calls to immigration services if they complain or seek redress.