If someone steals money from their employer, they could be guilty of a serious crime. But what if an employer takes money from their employee’s paychecks?
Employers steal billions of dollars from their employees each year by working them off the clock, by failing to pay the minimum wage, or by cheating them of overtime pay they have a right to receive. Survey research shows that well over two-thirds of low-wage workers have been the victims of wage theft.
Nonetheless, few local governments commit resources to enforcing laws that prevent wage theft. On the other hand, plenty of resources—police and prosecutors—are devoted to enforcement of laws against shoplifting.,
In 2012, there were 292,074 robberies of all kinds, including bank robberies, residential robberies, convenience store and gas station robberies, and street robberies. The total value of the property taken in those crimes was about $341 million.
By contrast, the total amount recovered for the victims of wage theft who retained private lawyers or complained to federal or state agencies was at least $933 million in 2012. This is almost three times greater than all the money stolen in robberies that year. The nearly $1 billion successfully reclaimed by workers is only the tip of the wage-theft iceberg, since most victims never sue and never complain to the government.
People worry about things like shoplifting, auto theft, bank robberies and home burglaries, but wage theft affects far more people than these more well-known crimes.
For example, employers routinely point to shoplifting as costing them and their customers a lot of money. Their lobbying for penalties is continuous. the costs of shoplifting. Walmart CEO Doug McMillon announced during a recent interview on CNBC that the retailer may have to raise prices or close stores due to insufficiently aggressive prosecution of retail theft. Target CFO Michael Fiddelke told CNBC in November 2022 that theft rose “about 50% year over year.” The company told Winsight Grocery Business that it’s working with legislators and law enforcement to address the “growing national problem” of retail theft. Similarly, last week, former CEO of Home Depot, Bob Nardelli, described retail theft as an “epidemic.”
In every state in the country, shoplifting above a certain amount results in a felony charge. When some states began to demote shoplifting below a certain value to a misdemeanor, employers organized to oppose the changes. Misdemeanor theft, below the felony threshold, generally results in little to no jail time. Felony theft can result in years in prison.
As for wage theft, when it is discovered, the employer simply has to pay back the amount stolen and possibly a fine. Corporations have been granted an identity as “persons” for the purposes of influencing laws—but they aren’t treated like people punished for breaking the law.
“Sources: Popular Information, a newsletter dedicated to accountability journalism and the Economic Policy Institute a nonprofit, nonpartisan think tank focused on low- and middle-income workers.