
Wage Theft is a Bigger Problem Than Other Forms of Theft - walterbell
https://www.epi.org/publication/wage-theft-bigger-problem-forms-theft-workers/
======
paultopia
As someone who used to practice law in a legal aid office, can confirm the
scope and difficulty of the problem. Employees, especially lower income
employees, have really limited access to the legal system; it's even worse
with more vulnerable populations (immigrants, lower educated workers, etc.).
Even basic stuff like employee stuff keeping their own independent hours
records often doesn't happen. It's really a problem in places like farm labor.

~~~
Eridrus
Is there a way tech can help in this space?

Many people complain about the fact that Google has a record of where you go
if you opt in to location tracking, but people should be able to extract this
record to get an automated working time estimate without needing to do do
anything to prepare ahead of time, if they have an Android phone and haven't
disabled the tracking.

I'm not sure about the completeness/time accuracy of the logged data, but
maybe you could weigh in on the presumed legal validity of such an approach?

~~~
zitterbewegung
Location tracking on phones is not nearly as a clean data source as it may
seem. For example when you use GPS in a large city tour location can get
confused . So your tracking data is rather rough.

~~~
Eridrus
When I look at the Location History Google has on me for my time at work it's
pretty accurate, which is unsurprising since it is in a single fixed location
and involves a fusion of not just GPS, but also Accelerometer and WiFi data.

It's entirely possible that is less accurate for others, but it's a source of
data that many people in this situation should already have, so you can use it
for those for whom it is more accurate, and ignore it for others.

------
ve55
You might be able to make a solid case that wage theft results in greater
nominal amounts of theft than violent theft, but that doesn't mean it's a
bigger problem as the title assumes.

The reason we are so hard on violent criminals isn't because they stole a
small amount of money or property, it's because of the violence part. We place
a lot of value on human life and safety, and when there's a notable
probability of someone being stabbed or shot, things get significantly worse.

Wage theft may result in some bad problems as well, but I can't imagine it
leads to more people being stabbed or shot.

~~~
49531
Theft isn't inherently tied to violence. It's easy to think of someone
breaking into your home with a ski mask on, instead of embezzlement or
pirating software. I would argue that wage theft is a bigger problem in the
sense that the scope is so much larger. This article brings up wage theft
amounts in _recovered_ wages and it still trumps regular theft. I'd guess a
lot of people on this thread have experienced wage theft, I know I have.

Would I rather a corporation steal $12,000 from me every year, or a burglar
break into my home and steal my shit? I know I wouldn't pay $12,000 for a
security system for my house.

~~~
awat
One of my favorite quotes I’ve mentioned on HN a few times applies here.

It’s only a crime if it occurs on the street level anything above that and
it’s called politics.

~~~
ddingus
Nice. Lucid too.

------
gremlinsinc
This doesn't just happen for low-wage jobs.

I joined a dev team on March 8th.

By March 21st, I learned that nobody has been paid in 2 months.

Around that same day, the CEO went to jail for writing bad checks.

All other employees quit that same day.

I stayed on after CEO got out-- hoping the client who has been supposed to pay
would pay. I was also offered 20k raise + moved to President of Software
Development. I was hoping I could temper the CEO's risk factors and keep the
business going and maybe get a paycheck, and help get the people who quit paid
as well for their previous work.

I worked feverishly 100+hours per week to deliver updates... (keeping some of
the IP on my own box --it only modified data, I'd run it locally then just
export the data to mysql.)

I've still not been paid, I've filed wage claims, and still nothing.

I've since told the CEO and client, until I get paid nothing else happens.

Has any other developer experienced anything like this? It's so frustrating
especially since I'm about to be homeless as a result... I'm owed like nearly
20k in back pay.

~~~
dbg31415
> This doesn't just happen for low-wage jobs.

Yeah... little rant here... I recently got back from a year-long contract in
Sydney.

Australia is one of the most labor-friendly places on the planet. So if this
sort of crap can happen there, it can happen anywhere.

Recently settled and signed NDA... but I feel relatively anonymous on here.

Anyway first... they made me an offer letter, and I resigned from the old job.
About a week later -- they knew I had given notice at the old job -- they came
back to me and said, "Yeah, we thought our budget was X, but now it's 80% X.
Take it or leave it." I was annoyed, but I took it.

Christmas came, they were giving out bonuses. Even though I was counted as a
full-time employee, I didn't get a bonus like all the other non-immigrant
workers. We found out that every Australian citizen or permanent resident got
a bonus, but none of the Americans did. Shortly after complaining, HR sent a
letter out to everyone saying that talking about pay or bonuses was a fireable
offense.

I stepped up to cover a few holidays, and worked over the Christmas break. But
they had automatically taken 2 weeks off of my vacation pool... it took about
4 months to get it sorted, I eventually did get the time back -- but only
after I pulled time sheet records (something most employees couldn't do) to
show I was working.

My final expense report never got paid.

They had my start date off by about a week. They had my end date off by 3
days.

Long story short, I ended up taking them to the Fair Work Commission (sort of
like Small Claims Court). It was not an easy decision to do this. My network
in Australia isn't huge, and I can't control the story they will tell inside
the company, or to future employers who want to call and verify work /
references. Clearly I can control who I list as references, but... far too
much damage can be done when someone looks up connections on LinkedIn, and
asks one of the shady folks, "Hey, what did you think of him?" I won’t get a
chance to tell my side of it, I just don’t get the job.

So I won my claim (or at least got them to make me an offer that I settled for
-- about 50% of what I was actually due), and helped a handful of other people
win their claims... but I'm quite certain I alienated my manager and MD and
everyone on the HR team in the process. It's expensive to stand up for
yourself. Time to fight it, cost of a lawyer, and cost to the network... not
hard to see why so many people don't fight it. A few grand... meh, I probably
would have written it off if they paid any portion time, expense reports, or
bonuses that they should have paid me.

Mind you this wasn't some Podunk 10-person agency... it was an agency with
over 2,000 global employees. And I wasn't some day-rate worker, I was
director-level and they tasked me with running some of their biggest projects
for some of their highest profile clients.

~~~
s73v3r_
I really don't understand this concern over alienating managers who actively
fuck you over. You're never going to want to work with them again, and you can
remove them from your LinkedIn profile.

~~~
dbg31415
It's more a concern that unless I take the company off my LinkedIn and resume,
when I go to apply for a new job inevitably someone will ask the people who
screwed me over, "Hey what did you think of him?" And that person will then
get to say whatever they want... and it could torpedo my job application
before I get a chance to build enough rapport to counter a BS claim / or won't
even get the chance to tell my side of it. I worked there for a year, and I'm
mostly proud of the work I did -- costly too to lose a year of work history.

~~~
s73v3r_
So tell the prospective employer not to contact them, and sue the company if
they say anything other than the dates of employment. They don't have a right
to tank your future employment chances because they're upset you called them
out for breaking the fucking law.

~~~
dbg31415
Inevitably, in reality, you don't just talk to HR. Anyone who interviews you
is going to look at LinkedIn, look at other networks, and talk to people who
they know who used to know you. Often times the management are well connected,
at least on LinkedIn... it's not realistic to expect all of the people who
interview you for a new job not to contact a former employer. AND... as soon
as you say, "Don't do it..." that'd be a red flag, of course they'd want to
reach out then.

The thing is, you'll never know what people say behind your back, or who they
talk to... or if they honor your request not to talk to past employers. Only
option would be to remove all traces from that company from your references /
LinkedIn... and then what do you do about the gap year(s)?

~~~
131012
A friend in HR told me once that HR people very rarely give bad reviews,
especially to people they don't know. Badmouthing an employee, without the
legal case to explain it, is often seen as giving a bad rep to the
organization. You should expect something more like a bland, generic 'that guy
was alright'.

------
49531
Organized labor is the only way to combat this kind of abuse. Workers cannot
rely on policy makers or corporations to do it for them.

Organizing doesn't mean forming an official legal union, or joining an already
established union (in some cases this might make sense but not always). You
can organize mutual aid networks that do things like share salary data and
talk about their problems.

~~~
ebikelaw
Don't you think there's also a place for law enforcement? In California many
public works projects are delayed because inspectors regularly come to the
work site, stop all work for the day, and interview the laborers on the site
to make sure they are getting paid. This is disruptive and the only reason
they need to do it is because when they find wage theft they don't really
prosecute it. There are small fines and then everything continues.

What the inspectors should do is give the contractors in question the
figurative death penalty: permanently revoked contractor license, revocation
of work orders, clawback of money already paid, jail time and serious fines
for the individuals responsible. We for some reason have a high tolerance for
white-collar crimes when we really should be prosecuting them vigorously.

~~~
wpietri
I would love to see law enforcement take this more seriously. But we should be
honest with ourselves that in this moment in America, government is much more
responsive to the needs of the rich. One only need look at the newspaper to
suspect that, but studies agree:
[http://www.princeton.edu/~mgilens/Gilens%20homepage%20materi...](http://www.princeton.edu/~mgilens/Gilens%20homepage%20materials/Gilens%20and%20Page/Gilens%20and%20Page%202014-Testing%20Theories%203-7-14.pdf)

One of the fundamental problems with employer/employee relations is that
employers usually have more workers than employees have jobs. Losing your job
is worse than having an employee quit. This fundamental imbalance of power
means that we'll always need ways to even things out if we want reasonably
fair situations for employees.

Labor laws and law enforcement can cover part of that. And we should certainly
pursue it. But I think people should also pursue collective action, be that as
formal as a union or as casual as Google's workers all pressuring their
employers to stop doing military work. Resilient systems always have multiple
ways to keep a problem from getting out of control.

~~~
dmix
It's funny that people blame law enforcement's lack of interest or effort in
white collar crime when for the last many decades the automatic response to
every economic 'issue' or moral panic of the day has been to set up more and
more agencies and more and more economic regulations.

Courts and law enforcement has evolved to become the very last resort for
dealing with these white collar issues. It's become the cultural automatic
solution to everything in American (or should I say western) government
systems. Every time something goes wrong we're always told the solution is
more new agencies to be formed and more complex - slow changing - laws. And
these agencies and law always have little mandate to prove efficacy and ROI.
They get put in place and stay that way for years. What matters was 'something
had to be done' at the time.

So of course law enforcement hasn't been doing a good job at punishing what
the rich do. Looking at law enforcement in isolation as the only solution of
course is going to look like it's doing a poor job vs enforcing typical
criminal laws, which tend to affect middle/lower class people far more.

As income is the greatest indicator of standard criminal acts (drug crimes,
theft, violence, etc). Wealthy people simply don't get involved in such crimes
and are far more likely to be involved in white collar crime, which thousands
of US agencies have been set up to punitively enforce.

There may be serious issues in the justice system (in terms of sentencing,
representation, law enforcement culture, etc) regarding the way the wealthy
are treated in terms of standard criminal issues. But applying the same lense
to white collar crime while ignoring the larger scope of regulatory frameworks
and agency based intervention is to severely misunderstand the issue.

These non-law enforcement agencies play a massive role in the US economy.

Yes, the efficacy of always turning to agencies and regulatory frameworks can
be honestly questioned and likely a source of many loopholes, but their pure
effort and the subsequent costs they impose on the economic system in their
efforts to stop this behaviour can't be downplayed... as if they aren't being
pursued compared to 'blue collar' crime.

Involving more of the courts and law enforcement to white collar crime could
legitimately be a solution here and the lack of real punishment for these
actions is a real problem IMO. I'm merely saying the results today are a side
effect of how things are done, the automatic political solutions being put in
place every time something goes wrong in business, not that things are good as
they are.

------
nimish
Man if only there was a mechanism where workers could bind together to
increase their bargaining power.

Except Americans have been indoctrinated for decades that unions=bad. This is
the result.

And guess what? Mandatory arbitration robs you of any judicial remedies.

------
firefoxd
One thing that was common when i worked in retail was if you worked overtime
without pre-approval from your manager, you won't get paid for those hours.
The one guy that complained was fired publicly for being lazy. No one else
took the risk.

------
stcredzero
It's easy for any employer to steal several thousand dollars from an employee
they are letting go. It will cost several thousand dollars to sue the
employer, and no lawyer wants to work hard for so little to gain. So employers
cheat employees of their last paycheck all the time, and almost never get sued
for it.

~~~
VHRanger
... you don't need a lawyer for that. In most cases it's a small claims and
the company defending itself will not be worthwhile in legal and PR costs.

You literally just need to shoot an email saying you're taking them to court
and often enough you're getting your money

------
jacob019
As a small business owner I was expecting to read about employees padding
hours, like clocking in during breaks or having a friend clock them in early.
It's shocking that people would abuse their employees and that people put up
with it.

~~~
MisterBastahrd
Shocking that they would abuse their employees? Most employees who work
paycheck to paycheck are happy to just have a job most of the time and really
can't afford to lose one. The most vulnerable people are always the easiest to
abuse.

There are various considerations here beyond actual pay. What happens when a
person making low wages finds a steady job with regular hours? It means they
probably don't have to figure out how to shuttle their kids between multiple
daycares / babysitters. These go on and on.

I know a person who made 9 an hour at a convenience store. Bad hours. Variable
shifts. She got an offer to work for a non-profit hospital. Makes 13 an hour
now with a set schedule (sorta), but lost her $500 a month SNAP benefits AND
about $300 a month in daycare costs. If she gets a raise, she'll lose
healthcare benefits for her kids, so her healthcare will essentially double
(before any rate increases). She's proud to be making more money even though
it's a net negative for her, and her employer has asked her regularly to cover
other positions that get out later without getting extra pay. She would rather
pick up the free hour here and there than have to deal with the hassle of
going back to shift work.

It's not like you can walk into the police office and tell the officer that
your boss isn't paying you to work extra hours, and even if you did, other
businesses would quickly decide that it wasn't worth hiring an employee who
wanted to make what they agreed to work for.

~~~
burfog
The combined effect of benefits cutoff is a huge problem. Think of the
nationwide productivity loss due to people avoiding employment that would
cause loss of benefits.

It's called the "welfare cliff". Check out the shocking graph in this article
and/or testimony. (same graph)

[http://www.learnliberty.org/blog/the-welfare-cliff-and-
why-m...](http://www.learnliberty.org/blog/the-welfare-cliff-and-why-many-low-
income-workers-will-never-overcome-poverty/)

[http://waysandmeans.house.gov/wp-
content/uploads/2015/06/Eri...](http://waysandmeans.house.gov/wp-
content/uploads/2015/06/Erik-Randolph-Testimony-062515-HR-5.pdf)

Assuming a 40-hour week (which could be 2 jobs) the worker will want to get
$12 per hour. That is the local maxima. To get a better final result, after
all the welfare and tax considerations, they'd have to earn $38 per hour.

So if you have a job paying $12 per hour, and are offered one paying $37 per
hour, you'll lose money if you take it. Basically, welfare keeps people down.
It keeps them in low-paying jobs because people get punished when they aspire
for better.

~~~
MisterBastahrd
Sorry, but that argument is without merit. In order to make $37 an hour,
you're going to have to be a skilled employee with years of experience in most
places or live in an area where $37 an hour is chump change. It's impossible
to acquire those skills AND raise a family at the same time without either
having money or having some other form of financial support.

The vast majority of people on welfare aren't actively avoiding employment.
That's a white myth people tell each other to comfort themselves regarding
their own mediocrity.

------
jeffdavis
They are very different concepts. The IRS is legally entitled to your money,
but it's not "theft" if you don't pay it.

------
jrs95
More regulation around wage theft & mandatory overtime or limits on hours
worked could really benefit tech workers as well. I for one would really like
overtime over 50 hours to be mandatory, at the very least. It's just not
sustainable or healthy to be working 60+ hour weeks and not taking any
vacation because that would result in critical work not being done quickly
enough for management to be satisfied. Clearly, what I'm describing is a
pretty shitty job as far as tech goes, but I have a feeling I am far from
alone in being in this situation.

~~~
49531
Honestly over 40 hours should be OT. I feel like a lot of tech workers feel
like they have cush jobs which will become less liberal if they start drawing
lines in the sand.

Our labor is early in its commodification though. As we become less unique we
will be easier to exploit. Organizing now isn't a bad idea.

~~~
namibj
In Germany, there is criminal liability if your subordinates (if you are
making their schedules, or would be the one to tell them to go home) work over
an average of 8h/workday (only those in the contract count, if none specified,
courts said to assume 5 work days), or a top of 10h/shift. Except for a very
few select industries, you also need at least iirc 11h off between two shifts,
but there are some ways/loopholes around this one. Any overage over the 8h
average has to be evened out within usually 3 months, unless something else is
in the contract (and as with German law, if the contract is evil, i.e.
"sittenwiedrig", it, or at least the relevant portions, is/are void).

This does mean that you might not get another job if you speak up, as always,
but it does mean that if you are willing to change industries, your superior
faces criminal charges.

Combined with the neglegible risk of not being able to feed your family, due
to the vast social support net, you are actually able to stand by your
principles, if you do care.

~~~
jotm
What if the employee actually asks/wants to work overtime?

~~~
the_mitsuhiko
Is this an actual issue?

~~~
jotm
Well, in the UK there's a waiver you can sign that lets you work more than 48
hours a week. It's more beneficial to the employer imo, but people who want a
lot of overtime can actually get it. I just wonder if it's stricter in Germany
- i.e. you can work 40hrs/week and that's absolutely it.

~~~
froh
According to the law the week is Monday through Saturday, 6*8=48...

We often tend to forget that we fought hard for the five day week.

So while it's common for qualified jobs to have a 40h/WK contract, high
workload opens the door to extend the week to 6 days, "Saturday work".

Again for qualified jobs you better compensate your people well for that...

For the floating average of 8h per day the rules then reference your usual
regular work week. So if you are on a 5 day contract (like most people these
days), that's where the 40h week comes from. For those amongst us who
regularly do 6 days, 48h is perfectly legal in Germany. And temporarily those
numbers go up to 50/60h weeks. The floating mean has to go down to 40/48
though. Iirc within a 6 month period, which is not law but usual (court)
reading of the law.

~~~
namibj
My information was 3 Months, unless a collective bargaining agreement
(Tarifvertrag) says otherwise.

------
bmmayer1
Repeating a point that keeps getting downvoted for unclear reasons: "Wage
theft" is an effective euphemism that misses the nuance of what's happening
here. Not paying wages according to the letter of the law is not the same as
stealing money from people, and employers, like most people who cheat on
regulations, often can't or won't shoulder the extra cost if those regulations
are suddenly enforced, and will cut hours or people instead. Workers are
certainly being shafted but probably not anywhere near to the extent in
reality as is being presented here in theory.

In any event, it's very different problem than property theft and shouldn't be
compared as such.

~~~
49531
Just because the act of theft happens under the veneer of corporate
bureaucracy doesn't mean it isn't theft. The money goes somewhere, and if it
isn't to the workers then it is to the employer.

You're right that corporations won't follow regulations that aren't enforced,
which is why workers need to be informed of their rights, given legal counsel,
educated and enabled to organize.

------
Karishma1234
A lot of those "right to receive" exist because of government regulations and
not because it is something employees or employers negotiated. What matters is
whether someone out there is willing to replace you for lower price or not.
Everything else is mostly virtue signalling.

------
roenxi
We'd rather that companies were honest, and yes the law should be enforced
fairly and as on the books to keep the playing field for corporations level.
But no, wage theft isn't a bigger problem than other theft.

Yes, wage theft is bigger numerically. But a reduction in wage theft is going
to be mirrored by a drop in the amount of wealth available. By definition, the
same or less work is being done for a higher cost; so by examining the net
situation, someone is going to have less actual stuff (and I can say with
confidence, it is not going to be the rich who do without). Increasing the
cost of labour will put people out of work.

Wage theft is one of those victimless crimes where both parties have agreed
that a situation is the best alternative and the government is declaring that
they are wrong. It is a lot more delicate than, say, gay marriage, because all
workers would prefer to have more money, and by far most workers would be
happier if they didn't have to work. But, end of the day, just because the
government says a worker is entitled doesn't mean the worker is truly unhappy
with what they get. In an extreme case, I've worked in situations where I have
been subject to wage theft (~10% lower compensation than I should have legally
been getting), and I tried to keep that off anyone's radar because I wouldn't
have had a job otherwise and I was being paid plenty.

Workers take the best option they have; possibly making that option uneconomic
is not a good idea. This is not how, eg, China, is lifting people out of
poverty.

~~~
49531
> reduction in wage theft is going to be mirrored by a drop in the amount of
> wealth available.

In a situation where wage theft is happening and then it stops happening, the
money doesn't get thrown in a garbage bin. The stolen money goes to the worker
rather than the employer.

If I got paid my average hourly rate for 10 unpaid hours per week, I'd make
roughly $12,000 more per year than I do now. $12,000 which would go towards my
student loans, or a down payment for a house, or just buying random shit.
Instead that $12,000 goes to the corporation I work for.

You might argue that they can do that to 10 people and afford to hire another
engineer, which is great, except now we have a corporation who is subsidized
by unpaid labor, not by being an effective corporation.

~~~
pbecotte
So your employer pays 48k for 50 hours a week of labor. Yes, if they suddenly
paid you 60k instead you'd be doing better. But that doesn't mean they benefit
from unpaid labor, just that the current rate is less than you think it is.

~~~
DFHippie
Somewhere there is a contract specifying the amount the corporation will pay
and the worker will receive for an hour of work. It is the violation of this
contract which makes it theft. This is also what makes driving someone else's
car away, taking their wallet, or moving into their house theft. If someone
walks off with your wallet, it isn't that you've misunderstood the legal
conditions of your ownership of that wallet. The problem, in other words, is
not in your understanding.

