Here’s an important editorial on something I haven’t written enough about: wage theft, i.e., situations wherein “employees are forced to work off the clock, paid subminimum wages, cheated out of overtime pay or denied their tips.” Sometimes this meshes with misclassification, another violation of labor law, wherein regular employers are classified as self-employed. According to one study, misclassification of port truckers resulted in over $800 million in wage theft in CA alone.
The editorial interestingly points out that this doesn’t just hit low-income workers, citing the Silicon Valley case where employers of top tech firms were allegedly colluding to suppress wage competition.
My strong sense is that one way to deal with this is to mete out a spate of significant punishments to violators as a signal that we’re serious about cracking down on wage theft. As I understand it, too often, the current penalties for being caught stealing workers’ wages are a slap on the wrist (though I think this is improving a bit in the misclassification space).
Also, as the NYT piece points out, wage theft is seriously under-policed, as the number of wage and hour inspectors at the Labor Dept has declined while the workforce has grown. Ross Eisenbrey provides an excellent analysis of the broader issues for our full employment project. He notes, for example, that “when Congress enacted the FLSA in 1938, it funded one Wage and Hour Division (WHD) investigator for every 11,000 workers. By 2007, when there were only 731 WHD investigators for the entire nation, the ratio had fallen to 1 inspector for every 164,000 covered employees. Even today, with around 1,000 WHD investigators, the odds of any particular employer being inspected in any given year are trivial.”
This is a rich area of pursuit in the interest of protecting labor standards which are in turn essential to protect the quality of jobs, often jobs held by those with the least bargaining power.