
Survey data show millions of workers are paid less than the minimum wage - anigbrowl
http://www.epi.org/publication/employers-steal-billions-from-workers-paychecks-each-year-survey-data-show-millions-of-workers-are-paid-less-than-the-minimum-wage-at-significant-cost-to-taxpayers-and-state-economies/?utm_content=buffer9befa&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer
======
JohnTHaller
The study estimates that $8b is taken from mostly lower income employees via
wage theft.

"What is wage theft?

Wage theft is the failure to pay workers the full wages to which they are
legally entitled. Wage theft can take many forms, including but not limited
to:

* Minimum wage violations: Paying workers less than the legal minimum wage

* Overtime violations: Failing to pay nonexempt employees time-and-a-half for hours worked in excess of 40 hours per week

* Off-the-clock violations: Asking employees to work off-the-clock before or after their shifts

* Meal break violations: Denying workers their legal meal breaks

* Pay stub and illegal deductions: Taking illegal deductions from wages or not distributing pay stubs

* Tipped minimum wage violations: Confiscating tips from workers or failing to pay tipped workers the difference between their tips and the legal minimum wage

* Employee misclassification violations: Misclassifying employees as independent contractors to pay a wage lower than the legal minimum

For more information about the different forms of wage theft, see Bernhardt et
al. (2009) or Gordon et al. (2012)."

Over the course of my working life, I've personally experienced or witnessed
all of these except one. They're all pretty common in the US in lower income
jobs.

~~~
mjevans
I really hate that service industry jobs can price in tipping as part of the
'wage' for the worker.

I'd much rather the employees just be paid a fair wage up front and that no
tipping would be allowed at the establishment.

~~~
StudentStuff
States like Washington & California don't support tip slavery, the business
has to pay tipped workers full minimum wage.

------
theprop
This is terrible, but it happens to better-paid workers as well. My brother
was paid a relatively high hourly salary by a firm who then sent him to work
at their client, but they didn't pay him overtime. He complained multiple
times to no avail, until he filed a case with the state's labor board...it was
a pain and probably difficult for most people to access, but then he _finally_
did get paid everything. The company quickly paid up and asked him to dismiss
the case -- so they clearly were "pros" at ripping off their people (they were
billing for overtime, just not paying it to my brother who had researched the
state laws). There need to be more penalties against larger enterprises
especially to discourage abusive behavior...seems to be widespread from this
report!

The problem always comes in that the government ends up fumbling everything
and will likely screw over small, struggling companies that aren't trying to
cheat anyone but just can't make the entire payroll for a few weeks, etc. It
is a difficult problem! A transparent database or even marketplace where
everyone's wages were clear may be a solution.

~~~
maxxxxx
"There need to be more penalties against larger enterprises especially to
discourage abusive behavior.."

That's often the problem. Same for illegal contract clauses. They often get
away with them or if not they pay a little and do it again next time.

~~~
Gibbon1
What I wish was that an illegal contract clauses be taken as evidence of bad
faith on the part of the employer in labor disputes. Means, illegal contract
clause -> proof of bad faith -> any labor violation -> 3X damages.

------
clarkmoody
Labor economics aside, that website is one of the best presentations of
scholarly work I've ever come across. How can we get this site format to
spread to journals / conferences / other think tanks?

~~~
pcrh
Out of interest, what exactly do you like about it? It seems similar to
several of the more prominent medical or bioscience journals that I frequently
read.

~~~
clarkmoody
Just the really nice typography, wide single column, nice charts. Also, the
table of contents is great on the side.

I come from aerospace where it's all two-column LaTeX docs and PDFs. Not much
in the way of web-based presentation.

~~~
pcrh
The Public Library of Science is an exclusively online series of journals in
biology and medicine. They have a fairly nice layout and design. Perhaps
aerospace has something to learn?

[https://www.plos.org/publications](https://www.plos.org/publications)

------
matheweis
There are other ways too, like requiring employees to pay for parking...

Housing is less expensive further away from the center of urban areas, but
transportation is much less developed.

~~~
cperciva
_There are other ways too, like requiring employees to pay for parking..._

Unless you're talking about requiring employees to pay for parking which
they're not using, this is not wage theft. To the contrary, the inequity would
be if free parking was provided to workers who drove to work but no similar
subsidy was provided to those who took public transit. (In Canada, free
employee parking is in most cases a taxable benefit.)

~~~
dikdik
>the inequity would be if free parking was provided to workers who drove to
work but no similar subsidy was provided to those who took public transit.

Really? Does it work the other way too? My employer will reimburse a small
amount of public transit costs, but the people that drive get no similar
benefit.

~~~
CalRobert
Do they get free storage for their cars during the workday?

------
urahara
These malicious practicies are overwhelmingly widespread I guess, even far
outdide of low income jobs.

------
RichardHeart
This article is seriously 26,857 words.

~~~
parshimers
Yeah, for real. Does someone have the tl;dr version?

~~~
arjie
I sympathise but the report actually has three introductory sections titled:
what this report finds, why it matters, and what can be done.

So the tl;dr you desire is in there.

------
candiodari
But this can't be possible ! The job market is at full efficiency (meaning the
supply of labour is so tight workers can systematically demand more pay and
better conditions).

Or so the FED, the BLS, and a few other government departments !

~~~
ryandamm
It's actually an open mystery why unemployment is so low, but we have yet to
see much upward pressure on wages. Theories I've read (probably in the
Economist, definitely at the NYTimes) is there is still hidden slack in the
labor market from people who dropped out during the recession, and are
gradually rejoining as the economy grows.

The link between supply and demand -- and prices/wages -- is really messy,
though. I mean, downward nominal wage rigidity is a big deal (and is well
documented). The labor market is nowhere near efficient.

So no, the UI rate is not some fake statistic, cooked up by government
agencies... it's just a noisy statistic for a messy market, whose relationship
to 'price' (wages) is nonlinear, laggy, etc.

(I think.)

~~~
ianai
I wouldn't call it noisy. Noisy implies it's inaccuracy tends to be positive
and negative. You can have a noisy signal that's not biased. But there's a
clear downward bias to the unemployment number.

My little heuristic is to double the number. For every person counted there's
at least one wishing for work but given up enough to not report.

Another factor is to consider inflation. Truly low income will be associated
with increased inflation. I would argue going from 1% to 2% is not a sizable
increase.

[http://www.tradingeconomics.com/united-states/inflation-
cpi](http://www.tradingeconomics.com/united-states/inflation-cpi)

~~~
dragonwriter
> My little heuristic is to double the number. For every person counted
> there's at least one wishing for work but given up enough to not report.

Why are you using a simplistic heuristic that assumes a constant relationship
between the headline unemployment figure and other measures when the other
measures are measured and published alongside the headline figure? (The
measure you seem to prefer, unemployed plus discouraged workers as a share of
labor force plus discouraged workers, is published as U4; headline
unemployment is U3.)

[https://www.bls.gov/news.release/empsit.t15.htm](https://www.bls.gov/news.release/empsit.t15.htm)

~~~
ianai
It was a last post before bed time.

------
tudorconstantin
How much would the low earners win or lose if the minimum wage laws would be
strongly enforced? My estimate is that they'd lose close to 100%.

Who would hire somebody for 15$/h if the worker is able to only produce 9$/h?

If the law is the only factor to decide the minimum wage, why not setting it
to 50$/h, or even 100$/h? Are the politicians and the policy makers really so
evil that they like seing workers people struggle at 10-15$/h?

~~~
ryandamm
Rather than rebut this in detail, let me just suggest that you study economics
before spouting off. It's fun to speculate about numbers, but there is real
research and real models to describe these dynamics.

I'm not an economist... but at least I know that about myself.

~~~
tudorconstantin
Rather than attacking random people on the internet insinuating that they're
economical illiterates, you yourself admitting to not being an economist,
please try and rebut this in detail.

~~~
ryandamm
Here, let me Google it for you:

[http://www.frbsf.org/economic-
research/publications/economic...](http://www.frbsf.org/economic-
research/publications/economic-letter/2015/december/effects-of-minimum-wage-
on-employment/)

I'm glad you "guess" it's nearly 100%. This article (the top Google hit for
"effects of minimum wage on employment") suggests it's in the realm of 10%
(though it's probably smaller) based on simple linear models of price
elasticity. A 10% drop in employment is not nothing! It could absolutely
matter! But that's the foundation for a debate, not some made- up numbers.

My main point is that it's foolish to 'guess' and start applying numbers...
it's tempting to make a point that's grounded in political philosophy, and
slap a coat of speculative, pseudo-quantitative paint on it so it sounds more
considered.

To your other point, about not wasting time on internet comments, I will
respectfully concede.

~~~
tudorconstantin
And what's the income reduction (in %) for those unlucky 10 percenters who end
up jobless?

~~~
mrow84
As we're all comfortable with numbers plucked out of the ether, let's use
yours:

1\. The group of low-wage workers produce on average $9/hr.

2\. A minimum wage of $15/hr is introduced.

3\. The income of 10% of the group falls to $0/hr because they lose their
jobs, a fall of $9/hr * 0.1 = $0.9/hr on average.

4\. The income of 90% of the group rises to the new minimum wage of $15/hr, an
increase of $(15 - 9 = 6)/hr * 0.9 = $5.4/hr on average.

5\. The net change in income is $(5.4 - 0.9 = 4.5)/hr on average.

So with all these contrived numbers the introduction of the minimum wage
raised low-wage worker pay by $4.5/hr on average. Is that bad for low-wage
workers?

Of course, really, we should just take ryandamm's advice here [0] and stop
trying to provide our arguments with the air of rigour by throwing some made
up numbers around.

[0]
[https://news.ycombinator.com/item?id=14381189](https://news.ycombinator.com/item?id=14381189)

