One worker’s tale of blatant wage theft – National Consumers League

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The fact that millions of Americans are out of work makes daily headlines, but a far less publicized problem is robbing working Americans of their full paychecks: the growing issue of wage theft.

A man we’ll call “Parker” recently came to NCL with his story: Parker, a skilled construction worker, had relocated back to North Carolina and was having a hard time landing a job. After weeks of searching, he was thrilled to find an opening at a firm that specializes in office construction and remodeling. Parker’s enthusiasm for his new job was short-lived. After he was hired, his employer informed him that he would be required to complete 40 hours of unpaid “training,” which for Parker meant a full week of arduous, physical work dismantling cubicles and work stations and replacing them with new ones.

“The ‘training period’ is nothing but a scam,” explains Parker. “We work as a team; no one needs to show you how to load or unload a truck full of old furniture, it’s common sense. The ‘training’ was just us paying him back for working for him.”

“According to the Fair Labor Standards Act (FLSA), training that is mandatory, work-related, and during business hours, needs to be paid to be in accordance with federal labor law,” explains Michell K. McIntyre, the Project Director of the National Consumers League’s Special Project on Wage Theft. “Forcing employees to work a job for no pay on the ruse that the work involves “training” is exploitation in its simplest form.”

After Parker reluctantly worked a full week for no pay, he learned that his employer had devised a myriad of unscrupulous excuses to reduce the pay further. Parker was hired with a starting a wage of $10 dollars an hour, but after daily deductions for gas to transport him and co-workers to the construction site and the “privilege” of using the tools necessary for the job, along with sporadic charges for other equipment the employer claimed were “missing,” Parker was making far less than initially promised.

“We have to pay $10 dollars a day to cover the gas it takes to get us to work sites and to use the tools,” says Parker, frustrated. “That’s one hour every day that we don’t get paid for; that adds up to about $160 to $200 a month that comes straight out of our paychecks.”

Automatic deductions not included, Parker doesn’t even get paid for all the hours he is at work. Parker reports to work at 7 am but the company van that transports workers to construction sites often doesn’t show up until much later, and it could be another half hour to an hour before the workers actually arrive at the work location. Parker and his coworkers can only clock in and begin earning their hourly wages once they are physically at the construction site.

The FLSA defines the workweek as the total amount of time an employee is required to be on an employer’s premises or work site. A workday can be longer than the employee’s scheduled shift or hours, but all additional time needs to be paid. In Parker’s case, several hours worth of pay are regularly subtracted from his paycheck.

“We have to report to work at 7 am, but the van that gets us to the location can show up well after that. When I work at two different sites in a single day, the time it takes for me to get from one job to another is subtracted from my time […] there have been times where I worked 15 hours and only got paid for 11.”

“According to the US Department of Labor’s Wage & Hour Division, time spent by an employee in travel as part of their principal activity, such as travel from job site to job site during the workday, is work time and must be counted as hours worked,” says McIntyre

Although wage theft victims often aren’t even aware of the fact that they are being victimized, in Parker’s case the violations are so egregious that he and his coworkers have come to understand that their employer is breaking the law. However, that knowledge is of little help.

“A lot of us don’t want to complain too much ‘cause we don’t want to lose our jobs. I’m trying to line up another job but I haven’t found one yet, so for now, I need this job,” explains Parker. “If you make too much noise you get a text at night saying you are laid off; I can’t afford that right now.”

National Consumers League has provided support and direction to Parker as he seeks redress for the wage theft he has experienced. Parker has already contacted the U.S. Department of Labor and the North Carolina Justice Center to help recoup his lost wages, but to start formal proceedings Parker would have to give out identifying information—something he is not yet prepared to do.

The U.S. Department of Labor Wage and Hour Division has resources to help victims and potential victims of wage theft. Its program, We Can Help, has a Web site (www.dol.gov/wecanhelp) and tools to help workers track their pay, overtime and vacation time – an app for smartphones and a printable work hours calendar in English and Spanish.

Parker’s plight highlights how wage theft victimizes workers in two devastating ways: by robbing them of their money and then preventing them from getting help for fear of losing their jobs. For workers like Parker, whose first concern is providing for his family, the strategy is often to wait to secure another job before attempting legal action. In a tough economy with steady unemployment, wage theft victims across the nation are in for a long wait.

To learn more about wage theft, or if you or someone you know may be a victim, click here for more information.

CA making strides with new wage theft laws – National Consumers League

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With the Congress tied up in partisan knots, some states have taken up the responsibility of protecting workers’ rights in the workplace. California recently passed two pieces of legislation that workers’ rights advocates are hoping will serve as a model for other states.

Recently California Governor Jerry Brown signed a pair of workers’ rights bills into law: the Wage Theft Prevention Act (AB 469) and the Employee Classification Act (SB 459). These new laws represent huge steps forward in the fight to protect workers’ rights in an otherwise pro-employer climate.

These new laws strive to prevent wage theft, strengthen existing laws, increase penalties on employers caught cheating their employees, and go after corporations cheating states out of much-needed tax revenue in the form of not paying payroll taxes on misclassified workers.

The Wage Theft Prevention Act (AB 469):

  • Requires employers to provide workers, at the time they’re hired, a written disclosure of the basic terms of employment (the pay rate, the payday, the name and address of the legal employer).
  • Requires employers to notify workers in writing when employment terms change.
  • Requires employers to keep paystub records for three years.
  • Strengthens misdemeanor criminal penalties for employers who willfully fail to pay wages due in 90 days after final judgment.
  • Allows a worker to recover attorney’s fees to enforce a court judgment for unpaid wages.
  • Strengthens existing wage bond requirements that apply to employers convicted of labor law and wage violations.

The Employee Misclassification Act (SB 459):

  • Makes it unlawful for any person or employer to engage in “willful” employee misclassification (classifying an individual as an independent contractor when he or she should really be classified as an “employee.”) This practice not cheats the state out of payroll taxes, and  robs workers of workers compensation benefits, unemployment insurance and  anti-discrimination protections and increases the likelihood that they will suffer minimum wage violations
  • Makes it unlawful to charge any fees or make any deductions in a worker’s paycheck for expenses such as space rental, services, repairs, goods, or materials, where such deductions would have been unlawful had the worker been classified as an employee.
  • Increases penalties that can be assessed against any employer for “willful” employee misclassification. Violation of the statute carries exposure for a “civil penalty” of between $5,000 and $15,000 for each violation; if the employer is found to have engaged “in a pattern or practice of (those) violations,” the civil penalty is increased to $10,000 to $25,000 per violation.
  • Requires public display of employee misclassification violation; employers, who have been found to have engaged in “willful” employee misclassification, must prominently display for one year on their Web site a notice to employees and the general public announcing that the employer “has committed a serious violation of law by engaging in willful misclassification of employees.” Employers that do not have a Web site must have the notice displayed prominently in an area that is “accessible to all employees and the general public at each location where a violation … occurred.”
  • Allows the California Labor and Workforce Development Agency and the California State Labor Commissioner to investigate and impose penalties on employers for employee misclassification violations.

Workers’ rights advocates see these new laws as good, practical examples of what can be done on the state level and would like to see them used as blueprints for other states interested in protecting their workers from the consequences of employee misclassification.

Labor Day: Demanding legal wages for hardworking Americans – National Consumers League

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End-of-summer barbecues, final trips to the beach, and the hectic start of the school year are usually what come to mind with the arrival of Labor Day. But with an increasingly erratic economy, high unemployment rates, and attacks on unions making headlines, this year’s Labor Day is the perfect time to examine the many challenges currently facing the American workforce.

Labor Day was originally started by the labor community not only as a means to celebrate their union accomplishments, but also as a day for workers to air grievances and discuss strategies for securing better working conditions and salaries. Labor advocates certainly have their fair share of grievances to air this season as major corporations continue to rake in $100 billion profits while reducing employee health benefits and pensions; workers are being forced to go on strike to demand fair treatment; and employee class-action lawsuits are stacking up in courts.

One troubling labor issue that hasn’t received much attention is wage theft, in which an employer illegally underpays or fails to pay an employee at all. Wage theft affects all sectors of the workforce; both white and blue-collar workers in industries across the board are vulnerable to this particular type of violation.

Wage theft can occur in a variety of different ways, all of which illegally rob employees out of what’s rightfully theirs. Wage theft tactics include:

  • Unpaid overtime
  • Employee misclassification
  • Minimum wage violations
  • Forcing employees to working off the clock
  • Making illegal deductions from pay
  • Not paying employees at all

Employee misclassification is one of the most common forms of wage theft and has incredibly far-reaching consequences, victimizing everyone from workers to Uncle Sam. With employee misclassification, an employer illegally mislabels an employee as an ‘independent contractor’ instead of an ‘employee,’ in order to be exempt from paying payroll taxes, unemployment insurance, and workers compensation—resulting not only in diminished capital to federal and local governments but saddling employees with additional IRS taxes in the process.

A typical misclassification scenario works like this: a Plano cable TV installation company in Texas was paying its workers on a piece-work basis and offering a flat rate for every cable installation they completed. The Department of Labor’s Wage and Hour Division conducted an investigation and determined that installers should have been classified as nonexempt employees, entitled to time-and-a-half their regular rate of pay for overtime hours worked. DOL sued on the workers behalf and the company has been ordered to pay $270,696 in back over­time to the 114 workers it illegally classified as independent contractors.

While wage theft can occur in any industry, certain industries are notorious for paying their workers below the legally required minimum wage. Restaurants, hotels, and janitorial and construction companies have a high frequency of underpaying their workers for both minimum wage and overtime.  Unfortunately, it’s still legal to pay someone below the minimum wage if they’re working in agriculture or are mentally disabled.

This Labor Day, let’s honor America’s workforce by demanding that all employers, regardless of industry or color of their workers’ “collars,” pay each and every worker the compensation they’ve rightfully earned.

To bring some much needed attention to this critical issue, NCL has launched a year-long Special Project on Wage Theft to raise awareness about the nature of wage theft in the United States and educate consumers, workers, businesses, and governments about wage theft issues. Stay up-to-date on the latest wage theft battles by following us on Twitter and Facebook.

 

Wage Theft: Victims’ stories – National Consumers League

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Losing money that is rightfully yours is a heartbreaking and debilitating experience that affects not only the victim of wage theft, but the victim’s family and loved ones as well. Here are some of their stories.

Juana’s Story from National Council of La Raza

Juana is a single mother who supported her family by working 11-hour days as a cook in a restaurant where she earned $7.50 an hour, received no benefits or paid leave, and was never paid on time. Shortly before telling this story, Juana quit her job because her employer owed her nearly $3,000 in compensation for more than six weeks of work. Juana’s situation is common in the low-wage labor market, where informal work arrangements often include long and irregular hours, no overtime pay, no breaks, no paid vacation or sick time, and inconsistent payment, often in cash.

I was the only woman there and it was up to me to do everything in the kitchen of a restaurant that sold rotisserie chicken. I made all kinds of food: tamales, pupusas, and all the traditional dishes. I had some problems with my boss because he was not one to pay on time. Right now he owes us three paychecks, and he is even behind on our pay from last year. This pay period I left because I couldn’t take it anymore. He owes me one check of $1,000 and two more of $900.

In the two years that Juana worked at the rotisserie chicken restaurant, she never knew when she could expect to be paid. Juana’s employer told her and her coworkers that he couldn’t pay them regularly because he had to cover the restaurant’s operating expenses, including the rent and supplies.

I know the pressures he faces, but I get mad. Thankfully, with God’s help, I was saving some of the little that I earned. When he would say that he couldn’t pay us, I would leave him alone until he could. There are three of us who work there. The other women are still there waiting. They say that they are going to wait because our boss just has to pay us. They have hope. We were always there waiting because we needed the work. Sometimes you think that you can’t go anywhere else and you stay.

Juana’s missing pay has affected her health and her family’s well-being. While she waits for her employer to pay her, she has had to move her family and rely on the part-time wages of her two teenage sons.

You have to think about supporting your children and your stress goes up. Recently I moved because I don’t have enough to pay my rent. I’m just going to go back to talk to [my former boss], and I hope he can pay me even if it’s only for one pay period, or maybe he’ll pay me later. That is what I’m going to go see, and if he doesn’t pay me, well then I will have to get help. I can’t lose. That was my work that cost so much sacrifice.

Thank goodness my sons are studying and working now. My youngest son goes to school and works at night. He doesn’t make much, only $450 every two weeks. My other son also makes very little because he works a part-time job. They say to me, “Mama, don’t work! You shouldn’t work if they don’t pay you. What are you doing?”

Juana decided she would rather have no job and look for something new than continue to work and not be paid. As she searches for a new job, Juana has taken on temporary work cleaning and cooking to support her family. She has not given up on the back pay she is owed, but she hopes that she can find something better.

Source – Story from the National Council of La Raza, We Need the Work; Latino Workers Voices in the New Economy, 7/5/11

Unpaid Overtime

A sandwich shop hired an “Assistant Manager” to help in the day-to-day operation of the business. She worked for over 10 years for the restaurant and had seniority over many of her coworkers. As such, she often would open and close the shop, and would train new hires. Other than that, her job duties were exactly the same or similar to those of her coworkers. She made sandwiches, worked the register, and cleaned the restaurant. Because she regularly opened and closed the restaurant, she routinely worked 12 to 16 hours a day. Unlike her coworkers, her employer did not pay her overtime for any hours that she worked in excess of 8 hours per day or 40 hours per week, claiming she was a salaried employee and therefore exempt from payment of overtime.

In actuality, this “Assistant Manager” was not an exempt employee, but was entitled to payment of overtime wages for any hours worked over 8 hours per day or 40 hours per week. She was misclassified by her employer as exempt from overtime, even though her job duties were virtually the same as those of her coworkers.

Unless an employee’s job duties are deemed Executive, Administrative, or Professional, he or she is generally entitled to overtime compensation, even if paid a salary.

The case was successfully litigated against the sandwich shop on behalf of the client, and the judge ruled that the employee was entitled to over $40,000 in back wages.

Source – Story from Jones, Clifford, Johnson & Johnson, 6/16/11

Employee Misclassification

A case settled a while back by the Wisconsin Department of Workforce Development. Alvaro was a dishwasher at a family-style restaurant in Madison, Wisconsin. He was being paid less than minimum wage and did not receive overtime. When Alvaro met with the employer to discuss the issue, the employer initially said he would pay all of the overtime wages Alvaro earned. A few days later, Alvaro was visited by the employer’s attorney who said that the employer would only pay a fraction of what Alvaro was owed and if he made trouble they would make trouble for him. When Alvaro filed a wage complaint with his state’s Department of Workforce Development, the employer’s attorney claimed that the company did not owe him the minimum wage or overtime pay because Alvaro was an independent contractor. Remember, Alvaro’s job was washing dishes for the restaurant in the restaurant’s kitchen.

If taken hypothetically, outside of the wage and hour context, Alvaro could have also found that his employer had treated him as an independent contractor under the workers’ compensation laws.  If so, Alvaro would have received no compensation if he were severely burned by scalding dish water in the workplace.  He may have also found that his employer had failed to pay its share of payroll taxes for unemployment insurance (UI), Social Security, and Medicare.  If so, Alvaro would have had to pay all of those taxes himself, and he would not have been entitled to UI benefits if he lost his job.  There is every reason to believe that Alvaro’s employer did not perform an appropriate analysis of his status under any law.  It is difficult to imagine a dishwasher for a restaurant could ever be a legitimate independent contractor.  Typically, these workers do not bring their own equipment, do not decide their own hours or method of work, and do not have a profit or loss motive.  In this example, the employer’s motive to evade the law seems clear and has devastating consequences:  Alvaro did not receive wages he rightfully earned until he filed a complaint with the appropriate state agency and they settled the case.

Source – Deputy Secretary of Labor’s, Seth D. Harris’ testimony to U.S. Senate Committee on Health, Education, Labor and Pensions on June 17, 2011

Illegal Paycheck Deductions

Several Polish cleaning women came to visit the Interfaith Worker Justice-affiliated Arise Chicago workers center. As a condition of their employment, they were required to live in a dormitory floor housing eight women. Two women shared a small room and bathroom down the hall. Each woman was charged $300 per month.

Then there are the workers in Houston whose employer deducted $1900 from four workers’ paychecks, claiming he had paid a notary to petition for the workers’ citizenship.

The now famous Saigon Grill delivery workers in New York City, whose employer paid them less than $2 per hour, also deducted $20 in fines for being slow on entering information into the computer or slamming the door too loudly

The Cincinnati Interfaith Workers Center assisted workers employed by Diverse Able. The first deduction from paychecks was $400 for flights from Puerto Rico.  Next was the advance on the first paycheck, plus interest, of course. The workers were initially charged up to $135 per week for four or five of them to stay in a two-bedroom apartment until the workers center intervened and the rent dropped to $65 per week (probably still higher than the true cost of the housing). Workers were charged $7 per day for transportation even if they didn’t work each day.

An employer in Chicago who handed out a list of fines for worker misdeeds that included:

– Being late for work – $100

– Being absent without giving at least 48 hours notification – $250 and up – Forgetting to lock the trucks – $100 from all crew members

– Smoking on job site or in company vehicles – $150 and up

– Possession of alcohol on site – first offense $500, second $1000, third $1500

– Quitting without giving two weeks notice will forfeit the worker’s previous weeks’ work, unless the worker had been there more than 6 months, in which case the worker must give a month notice or lose paychecks.

This employer sums up the policy: “If you think that your presence (spirit) at the job site is enough to get paid you are wrong. Before you are paid you must reveal the quality and quantity of your work and your loyalty to the company. In the future this is what your pay will be based upon.”

Source – Interfaith Worker Justice Executive Director Kim Bobo’s, testimony to U.S. Senate Committee on Health, Education, Labor and Pensions on March 9, 2009

Wage Theft: The importance of record keeping – National Consumers League

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Looking to recoup lost wages? Having accurate work records can make the difference between whether or not you get what you are owed.

The Fair Labor Standards Act (FLSA) does require that employers keep accurate records of hours worked and wages paid to employees. However, the FLSA does not require an employer to provide employees with pay stubs. In order to have a more successful wage theft investigation outcome, an employee needs to keep track of hours worked. The record should keep track of:

  • Name of company
  • Manager/owner name
  • Hours worked
  • Rate of pay
  • Start & stop times
  • Arrival & departure times

Tools from the U.S. Department of Labor

App for smartphones

The U.S. Department of Labor recently announced the launch of its first application for smartphones, a timesheet to help employees independently track the hours they work and determine the wages they are owed. Available in English and Spanish, users conveniently can track regular work hours, break time and any overtime hours for one or more employers. This new technology is significant because, instead of relying on employers’ records, workers now can keep their own records. This information would prove invaluable during a Wage and Hour Division investigation when an employer has failed to maintain accurate employment records.

The free app is currently compatible with the iPhone and iPod Touch. The Labor Department will explore updates that could enable similar versions for other smartphone platforms, such as Android and BlackBerry, and other pay features not currently provided for, such as tips, commissions, bonuses, deductions, holiday pay, pay for weekends, shift differentials and pay for regular days of rest.

Printable web calendar

For workers without a smartphone, the Wage and Hour Division has a printable work hours calendar in English and Spanish to track rate of pay, work start and stop times, and arrival and departure times. The calendar also includes easy-to-understand information about workers’ rights and how to file a wage violation complaint.

For more information regarding record keeping please contact the US Department of Labor Wage and Hour Division at www.wagehour.dol.gov or call the toll-free information and helpline, available 8 a.m. to 5 p.m. in your time zone, 1-866- 4USWAGE (1-866-487-9243).

Source – U.S. Department of Labor, Wage and Hour Division

 

Wage Theft: You’re a victim. Now what? – National Consumers League

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Are you getting paid less than you deserve? Do you suspect you are? Learn who can help you get back what you are owed.

Who to turn to: U.S. Department of Labor

The U.S. Department of Labor’s Wage and Hour Division (WHD) is responsible for administering and enforcing some of the nation’s most important worker protection laws. WHD is committed to ensuring that workers in this country are paid properly and for all the hours they work, regardless of immigration status.

If you have questions or concerns, you can contact WHD at 1-866-487-9243 or visit www.wagehour.dol.gov. You will be directed to the nearest WHD office for assistance. There are over 200 WHD offices throughout the country with trained professionals to help you.

File a complaint

The information below is useful to file a complaint with WHD:

  • Your name
  • Your address and phone number (how you can be contacted)
  • The name of the company where you work(ed)
  • Location of the company (this maybe different from where you worked)
  • Phone number of the company
  • Manager or owners name (who should we ask to speak to?)
  • Type of work you did
  • How and when you were paid (i.e., cash or check, every Friday)

 

Any additional information that you can provide such as copies of pay stubs, personal records of hours worked, or other information on your employers pay practices are helpful.

All DOL services are free and confidential, whether you are documented or not. Please remember that your employer cannot terminate you or in any other manner discriminate against you for filing a complaint with WHD.

State Departments of Labor/Employment

Most states have a Department of Labor or Department of Employment who are responsible for enforcing the labor laws of the state. Please look up you state’s Department of Labor/Employment to see the necessary steps needed to report a labor or wage violation.

Back Pay

A common remedy for wage violations is an order that the employer make up the difference between what the employee was paid and the amount he or she should have been paid. The amount of this sum is often referred to as “back pay.” Among other Department of Labor programs, back wages may be ordered in cases under the Fair Labor Standards Act (FLSA) on the various federal contract labor statutes.

Listed below are methods with which the FLSA provides for recovering unpaid minimum and/or overtime wages:

 

  • The Wage and Hour Division may supervise payment of back wages.
  • The Secretary of Labor may bring suit for back wages and an equal amount as liquidated damages.
  • An employee may file a private suit for back pay and an equal amount as liquidated damages, plus attorney’s fees and court costs.
  • The Secretary of Labor may obtain an injunction to restrain any person from violating the FLSA, including the unlawful withholding of proper minimum wage and overtime pay.

 

An employee may not bring suit under the FLSA if he or she has been paid back wages under the supervision of the Wage and Hour Division or if the Secretary of Labor has already filed suit to recover the wages.

Back wages also are available for underpayments to employees under the Davis-Bacon and Related Acts and the Service Contract Act, among other laws enforced and administered by the Wage and Hour Division.

Limitations of Back Pay

Generally, a two-year statute of limitations applies to the recovery of back pay. In the case of willful violations, a three-year statute of limitations applies.

For more information regarding wage theft services please contact the U.S. Department of Labor Wage and Hour Division at www.wagehour.dol.gov or the US Department of Labor We Can Help at www.dol.gov/wecanhelp and/or call the toll-free information and helpline, available 8 a.m. to 5 p.m. in your time zone, 1-866- 4USWAGE (1-866-487-9243).

Source – U.S. Department of Labor, Wage and Hour Division

Wage Theft: Employee misclassification – National Consumers League

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How are you being classified? Being listed as an employee versus an independent contractor can make a huge difference in the wages you are entitled to.

What is Employee Misclassification?

According to the US Department of Labor’s Deputy Secretary Seth D. Harris, in his testimony to the US Senate Committee on Health, Education, Labor and Pensions on June 17, 2011, employee misclassification “occurs when a worker who is legally an employee is treated as a self-employed worker, often referred to as an ‘independent contractor’.

Employee or Independent Contractor?

  • The extent to which the services rendered are an integral part of the      employer’s business
  • The permanency of the relationship
  • The amount of the worker’s investment in facilities and equipment
  • The nature and degree of control by the employer
  • The worker’s opportunities for profit and loss
  • The amount of initiative, judgment, or foresight in open market competition with others required for the worker’s success
  • The degree of the worker’s independent business organization and operation

Employee label vs Independent Contractor label

Differences in the labels…

Employee Label

Independent Contractor Label
Tax Forms

W-2

1099
Workers Compensation

Yes

No
Unemployment Insurance

Yes

No
Overtime

Yes

No
Minimum Wage

Yes

No
Health & Safety Protection

Yes

No
Anti-Discrimination Protection

Yes

No
Payroll Tax

Employer pays

Independent Contractor pays

What’s at stake?

  • Shortchanges workers, employers, states and the federal government
  • Workers are not paid the wages to which they are entitled
  • Law-abiding, responsible employers are denied a level playing field in a hyper-competitive business environment
  • Revenues flowing into federal and state treasuries are diminished when employers should be treating workers as employees avoid paying: unemployment taxes, workers’ compensation premiums, and (unless the workers pay them) payroll taxes
  • When the misclassified workers themselves do not pay some or all of the employment taxes for self-employed workers, the Social Security trust funds suffer a permanent loss.

For more information regarding employee misclassification please contact the U.S. Department of Labor Wage and Hour Division at www.wagehour.dol.gov and/or call the toll-free information and helpline, available 8 a.m. to 5 p.m. in your time zone, 1-866- 4USWAGE (1-866-487-9243).

Source – Deputy Secretary of Labor’s, Seth D. Harris’s, testimony to US Senate Committee on Health, Education, Labor and Pensions on June 17, 2011 https://www.govinfo.gov/content/pkg/CHRG-111shrg49715/html/CHRG-111shrg49715.htm

Wage Theft: Overtime pay – National Consumers League

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Certain employees are guaranteed paid overtime by law. Are you one of them?

Laws require overtime pay, at a pay rate of at least time-and-a-half, for some employees who work more than 40 hours a week. There are exceptions to that general rule, however, and that’s where some employees – those who should be getting overtime pay but aren’t – may find themselves a victim of wage theft.

For covered, nonexempt employees, the Fair Labor Standards Act (FLSA) requires overtime pay at a rate of not less than one and one-half times an employee’s regular rate of pay after 40 hours of work in a workweek. Some exceptions to the 40 hours per week standard apply under special circumstances to police officers and firefighters employed by public agencies and to employees of hospitals and nursing homes.

Some states also have enacted overtime laws. Where an employee is subject to both the state and federal overtime laws, the employee is entitled to overtime according to the higher standard (i.e., the standard that will provide the higher rate of pay).

Overtime: who is exempt and who is not?

The FLSA provides an exemption from both minimum wage and overtime pay for employees employed as bona fide executive, administrative, professional and outside sales employees. There are also exemptions for certain computer employees.

To qualify for exemption, employees generally must meet certain tests regarding their job duties and be paid on a salary basis at not less than $455 per week.

Job titles do not determine exempt status. In order for an exemption to apply, an employee’s specific job duties and salary must meet all the requirements of the Department’s regulations.

Examples of occupations not exempt from overtime (should receive overtime and at least minimum wage):

  • Nurses
  • First Responders (police, fire fighters, EMTs, etc.)
  • Construction workers
  • Insurance Claims Adjusters

For more information regarding overtime as well as overtime exceptions please contact the Department of Labor Wage and Hour Division at www.wagehour.dol.gov or the Department of Labor Fair Labor Standards Act (FLSA) Overtime Security Advisor at www.dol.gov/elaws/overtime.htm or the Department of Labor Fair Labor Standards Act (FLSA) Overtime Calculator Advisor at www.dol.gov/elaws/otcalculator.htm and/or call the toll-free information and helpline, available 8 a.m. to 5 p.m. in your time zone, 1-866- 4USWAGE (1-866-487-9243).

Source – U.S. Department of Labor, Wage and Hour Division

 

Wage Theft: Six common methods – National Consumers League

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Workers of all types, in all industries can fall victim to wage theft. Learn some of the most common ways employers are unlawfully keeping employees from the wages they deserve.

Overtime

Blue-collar and white-collar workers are entitled to overtime pay for time worked after hitting 40 hours a week, unless classified as exempt from the Fair Labor Standards Act. Among the questions to ask to learn if wage theft is occurring:

  • Who is exempt and who is not?
  • Breakdown by occupation

Employee misclassification

As an employee of a company, one has rights and protections guaranteed by law – workers compensation, payroll taxes paid by one’s employer and unemployment insurance,  but as an independent contractor a worker does not get the benefit of these rights and protections; independent contractors are also responsible for paying their ‘payroll taxes’ to the IRS. Among the questions to ask to learn if wage theft is occurring:

  • Employee label vs. independent contractor label
  • Cheats workers, governments and communities

Minimum wage violations

Between federal, state and, in some cases, city minimum wage, one is entitled to the highest rate of pay. Among the questions to ask to learn if wage theft is occurring:

  • What’s the minimum wage for your state?
  • Employers not adhering to the higher minimum wage (state vs. federal)

Working off the clock

Work starts when you enter the workplace, including the time it takes to don protective gear and ends when you leave the workplace,  including the time it takes to clean up from the day. Among the questions to ask to learn if wage theft is occurring:

  • Employees asked to work before and after set hours without additional pay
  • Employees working through break time and lunch without additional pay

Illegal deductions from pay

Deductions from paychecks should never result in the employee getting paid less than minimum wage per hour worked.  Among the questions to ask to learn if wage theft is occurring:

  • Employers take unauthorized or illegal deductions from employee pay
  • Example: Are employees being charged for  required dorm living, electricity, etc.

Not being paid at all

If one provides work for an employer then one should be paid;  however this does not always happen and is the most blatant form of wage theft. Among the questions to ask to learn if wage theft is occurring,

  • Employers not paying employees for all hours of work,  including travel time from site to site
  • Employers not paying employees for days of work
  • Employers not paying an employee’s last paycheck

For more information, or to learn whether you’ve been a victim of wage theft please contact the Department of Labor Wage and Hour Division at www.wagehour.dol.gov or the Department of Labor Elaws Advisors athttps://www.dol.gov/elaws/advisors.html and/or call the toll-free information and helpline, available 8 a.m. to 5 p.m. in your time zone, 1-866- 4USWAGE (1-866-487-9243). You can also contact your state department of labor or employment and/or a local workers center.

Source – U.S. Department of Labor, Wage and Hour Division

Wage Theft: Are you a victim? – National Consumers League

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Wage theft happens to blue-collar workers as well as white-collar workers. Take our quiz to see if you’re being robbed.

  1. Are you working more than 40 hours a week without receiving overtime (time and a half) or comp time?
  2. Are you labeled as an independent contractor when you think you’re an employee – 1099 or W-2?
  3. Are you being paid less than $7.25 per hour?
  4. Have you been asked to come in and work earlier or later than your stated hours and not been paid for that time?
  5. Are you working more than the stated hours in your employment agreement and not getting paid for it?
  6. Does your paycheck have unusual deductions?
  7. Have you not been paid for every day of work?
  8. Did your employer hold your last paycheck after you left their company?

If you answered ‘Yes’ to any of the above questions, then you may have been a victim of wage theft. Check out Wage Theft: Six common methods to see if you’ve been robbed.

For more information, or to find out if you’ve been a victim of wage theft, contact the U.S. Department of Labor Wage and Hour Division at www.wagehour.dol.gov or call the toll-free information and helpline, available 8 a.m. to 5 p.m. in your time zone, 1-866-4USWAGE (1-866-487-9243). You can also contact your state Department of Labor/Employment or a local workers center.

Source – U.S. Department of Labor, Wage and Hour Division