Kim Bobo, Interfaith Worker Justice (www.iwj.org) Executive Director and author of “Wage Theft in America” states that wage theft is a national crisis that is continuing to grow, and it’s not just a small problem in a few mom and pop companies.  She states that wage theft is found in some of the largest and most recognizable companies such as Walmart, Cyntas, Home Depot and even Target.  The video below is an important description of this very real threat to our economy. Unlike the banking crisis or gas price increases, wage theft can be solved and in doing so can be part of the solution to the current recession.

Current Unemployment

In the midst of this wage theft crisis people are finding themselves increasingly out of work.  The U.S. Bureau of Labor Statistics continually reports a bleak unemployment picture:

“Nonfarm payroll employment fell by 345,000 in May [2009], about half the average monthly decline for the prior 6 months. The unemployment rate continued to rise, increasing from 8.9 to 9.4 percent. Steep job losses continued in manufacturing, while declines moderated in construction and several service-providing industries.”

The national rate of unemployment rate has gone from 4.4% to 9.4% in just over two years, rising 25 out of the last 27 months.

Wage Theft Exacerbated by Unemployment

Corporations who engage in wage theft are more inclined to injure or steal from workers in other ways.  Unsafe workplace environments, tools and equipment, quality and integrity of protective safety gear and negatively incentivizing workers using threats of job loss are just a few ways employers take advantage of those working for them.

This last point is most poignant:   corrupt employers engaging in wage theft practices combined with the 2009 economic climate has created employers that use threat of job loss to maintain their wage theft practices, worsening the crisis and allowing wage theft practices to continue.

Under such circumstances, what price employment? What is the value in such jobs to improve society, uplift workers to higher income levels or provide hope that we are working to dig ourselves out of this economic mess?  My parents had a pole bean farm when I was growing up.  Dad never had problems getting workers because he paid everyone by check at the end of every single day.  No other farmer did that.  Dad always paid worker’s their full wages daily and his employees did better work for him as a result.  I believe that actually made him money.  I cannot imagine a more hopeless existence than to feel locked in a low wage job I’m afraid to lose with a shrinking paycheck working for a corrupt, criminal employer.

Captive, Repeat Victims

Every month the recession continues, lower class workers are pressured to “move further down” the socio-economic chain as displaced middle class workers apply for lower class jobs.  This coupled with the threat of job loss for those that complain about wage theft has applied double the job loss pressure on lower class workers.

In an armed robbery or home invasion, the perpetrator overtly and sometimes aggressively seizes cash or property in a single act against a victim.  Victims experience a single loss in a single event that often gets reported to police.  Wage theft on the other hand is silent, ongoing and grossly under-reported.  Victim workers endure loss each pay period for months or even years by the same criminal: their employer.  The ease with which wage theft can be executed, maintained through threats and repeated has created a “silent crisis.”

Employer ethical issues aside, many inexpensive yet modern tools are available to help employers avoid wage theft. Newer, more modern time clocks, time and attendance software and modern accounting software are nearly effortless to learn and use and these tools can improve efficiency without high cost.  For restaurants and other cash register-based businesses, many modern point-of-sale systems manage employee time automatically as part of their functionality.  Modern tools such as these leveraged to their full technological advantage can likely save employers money over antiquated paper or time clock systems.

Regardless, it is important to report wage theft no matter what excuse an employer might provide for doing it.  Often employers will engage in wage theft and use a recession or other financial excuse to keep more revenues even if they have sufficient funds to pay workers their fully earned wages.  Companies allowed to continue engaging in wage theft hurt everyone in their employ and are therefore just as dangerous to society as any criminal.  Wage theft undermines our countries economic foundation and ability to recover from recession.  To report wage theft, contact the United States Department of Labor for your state. CLICK HERE for a list of State Labor Offices or call the Wage and Hour Division’s toll-free help line:

1-866-4USWAGE (1-866-487-9243)

TTY: 1-877-889-5627

Monday-Friday 8 a.m. to 8 p.m. Eastern Time