Employee Law Group - Wage Theft

A guide to wage theft for employees

A Texas barbecue restaurant owes its workers nearly $900,000 in unpaid wages and stolen tips, according to a recent finding by the U.S. Department of Labor. Investigators found that Roanoke Hard Eight was taking tips from servers and pooling them in a group that included managers while also denying managers proper overtime pay over the past two years.

The case illustrates two very common examples of wage theft that we run into at Employee Law Group : stolen tips and unpaid overtime.

What does wage theft look like?

Wage theft – when employers keep money that rightfully belongs to workers – is a huge problem in the United States. Wage theft usually occurs through one of the following:

• Failure to pay for all hours worked
• Minimum wage violations
• Unpaid overtime or working “off the clock”
• Not permitting meal and rest break
• Not paying premiums for missed breaks
• Not reimbursing business expenses like mileage or cell phone usage
  

The reality of wage theft in the U.S.

The Wage Justice Center says that every year $1.4 billion is stolen from workers in Los Angeles alone – that’s $26 million every week. In 2014, the Economic Policy Institute found that the nationwide cost to workers from stolen pay was $50 billion a year . That’s more than the annual budget of 39 states . And the problem is not limited to small businesses or shady sweatshops. According to a report by Good Jobs First, Walmart paid $1.5 billion in wage penalties while FedEx paid half a billion, and Bank of America and Wells Fargo each paid more than $200 million.

The rules you need to know to protect yourself

Our attorneys at Employee Law Group have seen too many cases of workers, often those on the lower end of the pay scale and vulnerable to crooked bosses, getting their paychecks shaved by these kinds of devious and unlawful practices. Many employees are cheated simply because they don’t know the rules, so here are the basics:

• Once you are under your employer’s control, you are “on the clock.” Your employer can’t require you to come in and “prepare” for work before you clock in. If you have to prepare your workplace – for example, fuel up and load your truck, show up at a specific place to get in a company vehicle to drive or be driven to a worksite, or turn on the office lights and printer and computers before you can start doing your job – that counts as work time, and you must be paid for it.
• You must be paid at least the minimum wage for all hours you work. You cannot be forced or agree to accept less. In California, as of January 1, 2022, the minimum wage
• is $14 per hour for places with 25 or fewer employees and $15 per hour for 26 or more employees. Some cities and counties have higher minimum wages, so you should check local laws to confirm.
• All hours worked more than eight in a day or 40 in a week are paid at 1.5 times your regular hourly rate. If you work more than 12 hours in a day, that’s paid at double your normal rate. If you work seven consecutive days in a pay period, the seventh day is paid at time-and-a-half for the first eight hours and double-time for everything after that.
• If you are a tipped worker, employers and managers cannot be “tipped out” or pooled in with tipped employees. An employer or manager who violates this law is guilty of a misdemeanor and can be jailed and fined. Tips cannot be deducted from your hourly wage, and fees cannot be taken for tips paid with credit or debit card.
• Non-exempt employees are entitled to two 10-minute breaks in a full day’s shift – one in each half of the workday. They are also entitled to a 30-minute off-the-clock meal break if they work at least five hours in a day and must get that break before their fifth hour of work. If they’re working no more than six hours, they can waive their meal break. If they work more than 10 hours, they’re entitled to two meal breaks. During these breaks, the worker must be completely free from work responsibilities, such as answering phone calls, texts, or emails, and must be free to leave the workplace if they wish. If they are denied these breaks – for example, they’re required to be “on-call” or take their meal while still working – they are entitled to a penalty of one hour’s pay for missed rest breaks and one hour’s pay for missed meal breaks.
• If you are required to use your personal vehicle or personal mobile phone for work or incur any other expenses out of your own pocket to do your job, you must be compensated for it. In the case of your car, you should be paid mileage at the federal rate 58.5 cents per mile , or the cost of fuel with receipts. For mobile phones, a reasonable rate for reimbursement is usually about 25-50 percent of your monthly fees, depending on how much you use your phone for work.
• If you are contacted by your employer after your regular shift and are required to respond before your next regularly scheduled shift, this is called “reporting time,” and you are entitled to no less than two hours’ pay. For example, if you finish your workday at 6 p.m., and your boss calls or texts you at 8 p.m. to ask you a question that requires you to answer immediately, that’s two hours, even if it only takes you 10 minutes for the conversation. If it takes more than two hours, you’re entitled to pay for the whole time.
• Having the title of “manager” or “supervisor” does not automatically make you exempt from overtime, meal and rest breaks, and other benefits non-exempt workers enjoy. To be exempt in California, you must make at least twice the minimum wage ($58,240/year for 25 or fewer employees and $62,400/year for 26 or more). You must also be salaried and work in executive, administrative, professional, outside sales, or certain computer roles for more than half of your work time. If you can’t set or change policy, effectively hire and fire employees, or exercise discretion and independent judgment without oversight, you are not a manager for purposes of determining whether you are exempt.

How to protect yourself against wage theft

These are just some of the ways employers can take money out of your pocket and put it into theirs. If you believe you’ve been a victim of wage theft, it’s essential that you keep records of your working hours, your rates of pay, times when you weren’t allowed breaks, expenses that weren’t reimbursed, and every other incident you believe led to you being denied your true wages. If you’ve complained to your boss about it, memorialize those conversations in writing, such as by sending a follow-up email. And if you’ve been retaliated against for complaining about wage theft, you should reach out to an experienced employment lawyer right away.

Secure the money you are owed

We at Employee Law Group know that’s wrong, and we’re here to help you get that money back. Our attorneys have over 75 years of combined experience defending and vindicating workers' rights. We know how to get you paid quickly and fairly, often without filing a lawsuit. Reach out and speak to one of our lawyers today for a free consultation to find out how we can best help you get what you’ve earned.