An Epidemic of Wage Theft Is Costing Workers Hundreds of Millions a Year (2014)
epi.org
epi.org
So basically you steal the money, and if you're caught (unlikely), you just have to give it back.
Maybe I should try that next time I'm in a restaurant.
Perhaps ironically, people frequently place orders at restaurant and then decline to come to pick them up & pay. They restaurant still ends up providing the service they promise, and the customer declines to make the payment they promise.
It's terrible, but my understanding is it's similarly quite commonplace and hardly ever prosecuted.
Worst case they can give it to workers at the end of the shift.
You can order whatever you want unless a payment is made and product accepted a legal transaction hasn't occured. Missed items, uncooked food, poor quality are common reasons not to accept and send back. You can decide to decline the transaction at any point.
What businesses do is make the person pay first. Rarely does a fastfood worker take my order.. stop.. makes my food and then asks me to pay. They take my money serve the next person, I wait to get called.
A drive through is different and they get very low rates of drivers ordering only to drive away.
Businesses have found a way to deal with this issue.
The problem is likely that distinguishing these for prosecution/conviction, but that's probably a similarity with wage theft, not a dissimilarity.
It may or may not be a crime depending on intent, but a transaction is not the issue. It is breach of contract. Laws obviously vary around the world, but the US Uniform Commercial Code is probably typical. The restaurant has made an offer. The customer has accepted it. There is agreed-to "consideration" (value) to be provided by both sides. If the restaurant does what they said they would do you, having accepted the "offer" by making an order, are bound to do what you said you would do (pay the price that you knew was the price when you accepted the offer.)
Just increase the dollar amounts by a large enough factor, and you'll see it. A company sells widgets. I order a million dollars worth, items that can't simply be put back in stock and resold to others. They make them, but I don't pick them up. I'm not arguing that they didn't do their part by making defective items. I'm (probably) not required to pick them up, but I am required to pay what I agreed. You are saying "no transaction occurred", but that's not at issue. The company will (rightly) sue me for breach of contract.
It's the same for fast food except that the static friction of legal costs vastly overpowers the scale of recovery from the breach of contract for each instance of no-show. But if a single order for $10,000 (catering a company picnic) is not picked up, you get past the friction, and the restaurant will sue for breach of contract.
If someone is selling 1 million dollars worth of widgets and the buyer is unknown prepayment is required. If known and a valid purchase order is signed the customer usually has net30/60 to pay if they don't there might be a lawsuit or a black mark on their credit file with collectors calling.
Does it ever make sense to pay hundreds to win that 2 dollars back? Your employees waste more when meals don't turn out perfect. The cost of food to the restaurant includes the wasted food (usually from employee mistakes) and those are reflected in the prices.
Whether you choose to avail yourself of such policies or not (including even getting the contract in writing) has no relevance to the legal question of whether a contract was breached.
I hadn't realized this until I read your post, but most (not all, but most) drive-throughs that I've been to recently seem to be engineered to prevent people from ordering and then driving away.
"Engineered" like civil engineering, not social engineering. They feature a single lane with curbs on either side, typically near the edge of the property (so frequently near a fence or wall, etc).
I suppose the person could order, pull through, and then drive past the payment window and keep going, but other than that it's definitely not easy to leave that single, bounded lane once you're in it.
Moreover, the biggest culprit of time theft are struggling businesses, and most employees can and do leave these places without a problem. The lack of a power imbalance in these cases doesn't make the wage theft any better.
Because if they are salaried they are exempt from the FLSA and not entitled to overtime. (Mind you, that doesn't actually prevent hospitals from paying overtime, they just aren't required to.)
It’s messy for sure.
But, when employers and employees steal from each other, the fact that one is a criminal matter and the other a civil matter says a great deal about the law is and what purpose it was designed to serve.
(It may be appropriate to criminalize failing to pay employees, but I'm not sure about the first and higher-order effects of doing so, or how to craft legal principles and laws with the right incentives, while avoiding special cases like the laundry list of exemptions to California's AB5.)
The difference between “stealing cash” and “wage theft” is only a difference in perspective. The employee didn’t perform any labor to earn the money they took so they’ve broken the contract and now they’re in debt to the restaurant. Likewise, an employee’s labor is a fungible resource they control and the expenditure of it that solely benefits the restaurant through a lie (concealing their actions) is no different than someone scamming the person at the register and walking out without paying.
That's tautological. The actual reason it's a civil matter is because the people who write and interpret the law want it that way, yes?
https://www.npr.org/2021/09/02/1033727651/investigation-show...
https://www.tcworkerscenter.org/wp-content/uploads/2018/09/W...
I always thought that if government had a role to play in our lives this stuff should be near the top if not at the top of the list but I don't know of any country where it works the way I think it should work: The employee makes a single phone call (just like calling the police only slower), the gov agency calls the employer and instructs him to follow the rules leaving zero ambiguity. If he fails to immediately and retroactively correct his mistake an investigation and a fine follows. Ideally the employee is also compensated appropriately. If they lose their job in the process a year salary seems reasonable.
Why else spend millions to write all those laws if we are not going to implement them? Seems a waste of money? Why go to court for obvious things? In NL they have to steal more than 10% of your salary or the case will be dismissed. It's probably much less expensive than the US but it ain't cheap and you can forget ever getting promotion or a raise even if they don't just fire you.
We do in theory have such an agency in NL but they are more hunting for slave labor and cursory investigate pre-announced sectors one by one.
Maybe similar in scale to yearly losses from stuck vending machines.
Perhaps we require CPAs to certify that their clients are not engaged in wage theft? Small businesses that do their own taxes may have an incrementally greater chance of being audited. Then, IRS audits should also look for wage theft.
How is the CPA supposed to know that? Now you need auditors/PIs staking out the break room (or wherever the timecards are stored) to make sure workers aren't misreporting their working hours.
Illegal aliens somehow manage to have agreements with people paying them money. Lawmakers disagreeing with your terms of employment doesn’t have any bearing on the meaning of “theft”.
The fact that you’re coming up with such convoluted legalistic reasoning shows what a lie it is.
Look, you worked some amount of time for which federal law says you must be paid but you weren’t. Even if you agreed to those terms, implicitly or explicitly in a verbal or written contract, it’s absolutely still illegal.
So someone is in possession of wages to which you are (and, very explicitly, they are not) legally entitled. You can come up with whatever term you like for this situation but personally I think “theft” is remarkably straightforward and appropriate.
I think it's best if we just keep the word "theft" out if it. It is a misleading rhetorical tool.
I don't see it. Is your contract about labor done, or about time given away?
In the first case, i don't see it, unless you lie about the labour done (which is pretty hard to do unless your employer don't understand one lick of what you're doing). If its time spent, well, i'm pretty sure that you then have to take into account commute time, time spent thinking about your work, mistake you've done, explaining what you're doing to people, bounding with coworker. In this case, i'm pretty sure most devs, arch or ops are owed a lot of money :)
Shouldn't it be called fraud rather than theft? I thought theft is depriving someone of something they own... but you don't own the money yet before the payment is made. My understanding was, if you intended to pay a debt, but later refuse to, then you pay it back with some interest (or none, depending on the agreement) and it doesn't qualify as theft. And if you didn't intend to pay it when you acquired the debt, it's fraud... still not theft.
The semantics really matter, I think. And I think it might be a great example of why we should really not muddy discussions of crimes (or other things for that matter, I guess). If you insist on treating unpaid debts as theft, and you get exactly what you asked for, you're probably not going to like the outcome. You don't own your employer's money until it's paid to you, just like how a credit card company doesn't own your money until you make your bill payment. Otherwise everyone who declines to make a payment on their credit card bill would also be a thief.
Possibly worth noting if you reversed something like the McDonald's example, going into a restaurant and agreeing to pay for a burger, they give you a burger, and you don't pay, I'm pretty sure that would be prosecuted as theft. The terms of exchange don't specify payment in future installments with interest. Labor seemingly works the same way. Batching payments in biweekly installments is for convenience because it would be impractical to disburse funds continuously, not because you're loaning your labor. If you want to say they're not stealing money, fine, but they're stealing work. I guess the law doesn't seem to see it this way, though.
This is the right answer. We aren't in danger of eroding the semantic foundations of law by using "theft" instead of "fraud", because "wage theft" is a term with a specific definition.
If you go with your friends to restaurant, with the understanding that you’ll pay the bill everyone will pay you their part, but one of them refuses to do so afterwards, would anyone call this “meal theft”? No. Your friend is still morally in the wrong, of course, it’s just not what “theft” is.
Source? I think this term has been in general use for at least two generations.
https://books.google.com/ngrams/graph?content=wage+theft&yea...
I think you’re conflating wages earned and wages paid. You most definitely do “own” the funds you’ve earned even if your employer has not yet paid them out to you.
"Own"... in what sense? Legally? If I went to withdraw that money from my employer's bank account, would they let me, or would they tell me that's not my money, even though it was supposed to be paid to me?
Your private employer doesn't have the ability to define ownership. Governments, and by extension the judiciary, however typically are granted that.
"They" was referring to the bank, not the employer.
> it matters that you're legally entitled to it and a court would enforce it and have it paid to you.
They wouldn't do it in the same situation as theft I think, though, which is kind of my point. Like if a coworker who joined the week after you got paid from the funds that should've gone to you the week before, and they were already aware of the practice, they would not be receiving "stolen goods" and I'm pretty sure a court would not say you'd be entitled to claw it back from the other employee because the funds somehow actually belonged to you. (Because they didn't; they were merely owed a.k.a. promised-that-they-would-someday-belong to you.)
If it helps, I see this as somewhat (not entirely) similar to the difference between stocks and stock options. Just because you have the option to get some stocks, that doesn't mean you own the stocks.
A court would say you're legally entitled to claw it back from your employer because that is your money, legally, after performing your work duties per your employment contract and labor law.
Because then you would own the money after the court legally transfers the ownership. They don't belong to you beforehand, is what I'm saying.
> A court would say you're legally entitled to claw it back from your employer
Not from the other employee. You completely missed the points of my examples, especially the one about receiving stolen goods. Try reading them again.
If you just want to call it theft despite all the differences it has with actual theft, I obviously can't stop you, but I tried to explain precisely some rather important differences in how they're treated.
You don't claw it back from your co-worker because money is fungible and just because they received money that could have paid you doesn't mean that's your money. That's money owed to them from your employer who also owes you money.
Honestly I ignored that initially in my response because I thought the example was a bit contrived and because of my above reasoning didn't really hold water.
> just because they received money that could have paid you doesn't mean that's your money
These are in direct contradiction with each other, and you confirmed exactly what I'm saying in the second one. This is exactly how the money isn't yours! That money in the bank isn't yours either just because the employer could've paid you with it!
I'm not sure where to go from here (I feel like you just made my point for me) but if we still disagree then I guess we might just have to leave it a that.
Modern finance is essentially the Art of I.O.U's.
Before Grimm1's instance of someone else getting hired on, your hypothetical employer has their affairs set up such that expected payroll is met. Payroll is calculated as a function of headcount, and often, the business owner/primary equityholder are the end eater's of any financial shortfalls. They get paid last. Payroll must be paid first, vendors generally fall somewhere in between, and are somewhat more flexible in how you can accommodate them, as long as you make good on it.
Grimm1's scenario would therefore properly play out as the Owner doesn't take home as much (honestly any profit if things have deteriorated to the point you can't meet payroll).
The courts do not look favorably on not paying your people, and in bankruptcy, your payroll obligations take primacy(I think).
You (dataflow) don't necessarily paint the most accurate picture in the sense that the liability does in fact exist in a materially fashion. You can "call it" in the same way that a bank can do a "margin call", which usually requires getting an agent of the court involved.
The sad thing is, legal representation/effective litigation has such a high barrier to entry, that most people don't even realize they can. The other problem is the additional legal costs may jeopardize a business to the point it death spirals, ensuring you never get made whole.
USPS is an interesting case, because I'm not sure what else might be in play due to it's quasi-public nature. A federal institution cannot go into arrears. (Literally, a lot of Federal managers won't even be comfortable letting you do volunteer work in my experience). They have to furlough on budget shortfalls. But USPS is not "Federal" like most Executive agencies, as they are still technically private, or have been operated that way, while also being Constitutionally mandated to exist.
USPS as I recall, is also one of the only employers required to pre-fund their pension liabilities. Unlike everyone else in the private sector who apparently aren't.
> These are in direct contradiction with each other, and you confirmed exactly what I'm saying in the second one. This is exactly how the money isn't yours! That money in the bank isn't yours either just because the employer could've paid you with it!
By my above clarification does it make sense from my viewpoint if I now say something like, "That money is mine, my employer is simply holding it for me, because I could use the courts to retrieve it if they said they don't want to give it to me."
You don't have to agree I just want to make sure I'm getting my point across.
No, that's not what I'm saying. You can obviously lend something and it still belongs to you even though someone else possesses it.
I'm saying that if something has previously belonged to someone else, it will not be yours until and unless either (a) its existing owner, or (b) a valid legal procedure actually transfers the ownership. Moreover, until that is the case, you cannot take possession of it without the consent of the owners, and doing so would not make you its owner. Furthermore, a mere contract that you would be paid $X by Y time does not imply you will be the owner of $X of the payer's money at Y time (nor earlier). It is merely a promise to transfer ownership, which may or may not occur due to numerous reasons both inside and outside the employer's control. Just like how a stock option is a promise to transfer stock, not a grant of ownership of the stock, and just like how that has nothing to do with your physical possession of anything.
I'm pretty sure it's possible to write a contract that actually grants you ownership of some funds by a certain time, but I'd bet no employer would agree to that. Precisely because it would have quite different legal implications than merely a promise of payment.
I get the feeling the confusion here is that you're conflating moral ownership with legal ownership. That you have a moral right to something and that there exists a legal procedure to grant you ownership doesn't mean you are the legal owner before that procedure occurs.
I'm going to do something never before done on the internet and change my position. I think you've convinced me that there is a difference.
Though I'm not sold that in most matters of practicality it would have that much of an impact because if I'm able to compel you to give me X through something like "a valid legal procedure" then I at least had a claim to ownership of X to begin with, which I can use to get possession of X and full ownership, in your sense, of X. It just took me a few extra steps instead of a neat transfer by the person I'm compelling through the legal procedure but at the end I still get X.
The only other thing I see here is that with stock options, execution is legally optional and a decision made by the person with the option. It's not legally optional to pay someone wages if they're employed under a standard wage contract and that decision isn't made by the employee to not be paid it's being made by the employer that's an important distinction.
Anyway, whether I have X or a magic token (in this case the government) that upon using it will force you to give me X makes no difference to me, still got X. If it didn't contracts would be worthless and we both know that's not typically the case. So if anything I see it as a distinction ultimately without difference but I guess there is value in seeing the distinction anyway.
Anyway good conversation and I imagine we still have some disagreement here but I'm going to go enjoy my Saturday evening, have a good one yourself!
Yes? Kind of insulting that you ask, but thanks for at least asking instead of just accusing.
> It is clear that the employer owes a debt to the employee as soon as the labor is performed per the labor agreement. The employee owns the debt.
The employee owns the debt, not the funds. That's precisely the reason the employee needs to sue: he doesn't own the money yet. Otherwise he wouldn't need to sue; it would already be his and he could take possession of it.
Consider this: if the employee went into the employer's drawer and took out cash to get his pay without authorization, is that legal? I'm pretty sure that's theft, despite him legally owning the debt. Which I think is why you don't see e.g. underpaid cashiers going around removing cash from registers to repay stolen wages.
If it helps, you can also look at this from another angle: stolen goods can in general be returned directly to their owners. And stolen goods are in general illegal to possess knowingly. Now what would happen if that money was subsequently paid to another employee? Could the first one claw it back on the basis that it was theirs? No, I'm pretty sure he'd get to keep it because the money never actually "belonged" to the first employee. Or if the second employee was already aware of the wage having been "stolen" from the first one, is he now also a criminal for receiving stolen goods? I'm pretty sure the answer is no, but you're welcome to fact-check me on all these; I'm happy to learn more.
You don't. You own a IOU until it hits your bank account. The difference is subtle, but you can see it manifest during bankruptcy. Employee salaries are pretty high on the list in terms of "which creditors get paid first", but AFAIK they're subordinate to secured debt. That means it's definitely possible for you to lose the money you "owned", which does not fit with the common definition of "own". For one, you don't have exclusive control of it.
Besides, theft is used as a specific name of a set of crimes, but it also has a generalized definition that means unjust taking, which contains fraud and other forms of theft
Employers should get prosecuted harsher because they have the power.
Theft is a more consistent term for this than you're giving credit.
If you don't intend to pay debt when you acquire it, that is fraud. But your equivalence ignores the counterparty: a worker is not loaning out their time to a company contingent on a loan agreement, they are making value as soon as the work is made, a fraction of which they own at that point. The terms are legally very different; one is a credit agreement and the other is a wage, because the counterparties are different.
In an ideal world, the wage agreement is far stricter than the credit agreement -- hence, it is called "theft" when it is violated. Unfortunately, as stated in the article, we do not live in an ideal world.
Semantics really matter indeed. What does "to own" means for you? To have it on your person? To have it in your bank account? To hold it with your hands?
Turns out it is much more complicated than that and none of these conditions are neither necessary nor sufficient. You should look up the bundle of rights definition of private property to see how complicated it gets. The moment you contractually are entitled to that money, but deprived of your right of exercising your agency over it, you're being deprived of your property too, hence the appropriateness of the term "theft".
> if you intended to pay a debt, but later refuse to, then you pay it back with some interest
Only if you agreed to this contractually (or whatever ambient legal context defines the terms otherwise). "But I was gonna pay interest on it" is not a defense of delinquency. It is like I can steal your TV and say "I was gonna return it back, with a smaller TV on the side". You can't deprive people of their bundle of property rights (e.g. right of access and use) willy nilly.
> Otherwise everyone who declines to make a payment on their credit card bill would also be a thief.
Terms of this is very clearly defined on your credit card agreement; you are in delinquency of that missed pay indeed, hence the consequences of penalty payments, credit score impact and so forth.