I abhor the term “wage theft,” and you should too

By Jon Hyman on April 17, 2018

This past Sunday’s Cleveland Plain Dealer ran a story entitled, Do wage theft laws in Ohio harm or help workers? Notably, it quoted yours truly as the voice of management on this issue (thanks to Olivera Perkins for the interview):

Some business advocates argue with the very term “wage theft.” Jon Hyman, a local lawyer who represents employers, says not every employer cited for wage theft has willingly denied rightful wages.”To me, wage theft is a loaded term,” he said. “It presumes an intent to steal.”

For example, Hyman said a former client paid a human resource consultant to do an audit of employee classifications and followed the consultant’s advice.

A few years later, he said, the U.S. Labor Department, which also investigates wage theft, determined that many employees had been misclassified and had not received overtime pay to which they were entitled. The company ended up paying an undisclosed negotiated amount of unpaid overtime to the misclassified employees.

Let’s break this down further.

According to wagetheftisacrime.com (an actual website), “Wage theft occurs when employers do not pay workers according to the law. Examples of wage theft include paying less than minimum wage, not paying workers overtime, not allowing workers to take meal and rest breaks, requiring off the clock work, or taking workers’ tips.”

What’s missing from this definition? Intent.

Theft is a crime of intent. It requires a motive. If I walk out of the supermarket with a sleeve of Diet Pepsi underneath my cart, and forget to pay for it, I didn’t steal it. I just forgot it was there. Now, if I load it into my car, and don’t go back inside to pay upon the realization, that’s a different story. But that story also has intent underpinning it.

The term “wage theft“ suggests an intentional taking of wages by an employer. Are there employees are who paid less than the wages to which the law entitles them? Absolutely. Is this underpayment the result of some greedy robber baron twirling his handlebar mustache with one hand while lining his pockets with the sweat, tears, and dollars of his worker with the other? Absolutely not.

I’ll be the first to admit that we have a wage-and-hour problem in this country. Wage-and-hour non-compliance, however, is not an employer sin of commission, but a sin of omission. Employers aren’t intentionally stealing from their employees; they just don’t know any better.

And who can blame them? The law that governs the payment of minimum wage and overtime in the country, the Fair Labor Standards Act, is 80 years old. It shows every bit of its age. Over time it’s been amended again and again, with regulation upon regulation piled on. What we are left with is an anachronistic maze of rules and regulations for which one needs a Ph.D. in FLSA (if such a thing existed) just to understand it all. Since most employers are experts in running their businesses, and not the ins and outs of the intricacies of the Fair Labor Standards Act, they are fighting a compliance battle they cannot hope to win.

As a result, sometimes employees are underpaid. The solution, however, is not creating wage theft laws that punish employers for unintentional wrongs they cannot hope to correct. Instead, legislators should focus their time and resources to finding a modern solution to a twisted, illogical, and outdated piece of legislation.

Employees absolutely deserve to be paid every cent they are owed for every minute they work. Anyone who tells you differently is both wrong, and likely a crook. But, to use a term that presumes that every employer who misses a dollar here or there intends to steal from its employees misses the mark.