You often hear about someone being arrested for embezzlement or stealing company property. But what about the other way around? You rarely hear about a company stealing their employees’ wages.
However, it happens frequently, and it could be happening to you.
What is wage theft?
Wage theft occurs when an employer doesn’t pay an employee their earned wages. And it happens more often than you realize. In the United States, employers steal approximately $50 billion annually from their employees. While wage theft can happen to anyone, employers typically target more vulnerable populations, such as immigrant workers, minorities and young employees in industries such as retail, food service, hotels and construction.
Wage theft comes in many forms, such as:
- Unpaid overtime: Federal law states that most employees are entitled to earn one and a half times their regular rate for any hours worked over 40 in a week. Employers may miscalculate the employee’s hours or refuse to pay altogether.
- Employee misclassification: Misclassifying an employee as an independent contractor means that the individual doesn’t have protections such as minimum wage, overtime pay or benefits.
- Illegal deductions: Some deductions, such as taxes, are legal. Deducting costs for uniforms, broken merchandise, and drawer shortages may violate wage laws.
- Denial of breaks: Indiana doesn’t have laws requiring employers to give adult workers meal and rest breaks. However, for employees under the age of 18, companies are required to provide them with a 30-minute break if they work more than six hours. Furthermore, federal law states that if an employer offers short rest breaks between 10-20 minutes, those breaks must be paid.
- Off-the-clock work: If an employer asks you to prep for your shift before it officially starts or stay to clean up after you clock out, then they are breaking the law by requesting you do unpaid work.
Times are tough for many working families, and lost income means struggling to pay for rent, groceries and utilities. To ensure you are not a victim of wage theft, you should review your pay stub to ensure your hours, overtime and deductions match what you’ve worked. Additionally, familiarize yourself with federal, state and local labor laws regarding minimum wage, overtime and breaks.
If you have concerns about your pay, discuss it calmly with your employer. If there is no resolution or your employer retaliates against you, you will need to reach out to a legal professional who can help you get the wages you’re entitled to receive.
