FACT BRIEF

Do US workers lose billions of dollars each year to wage theft?

Saturday, January 9, 2021

By Mia Dillon

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YES

Wage theft is almost never reported by its victims—the workers who are deprived of legally-entitled wages. It is therefore difficult to measure. A widely-cited 2014 estimate by the Economic Policy Institute, which advocates for the needs of lower-income workers, put the figure at as high as $50 billion a year.

In 2017, the institute estimated that 2.4 million workers in the 10 most populous states lost $8 billion annually to just one form of wage theft, employer violations of minimum-wage laws. Other common forms of wage theft include non-payment of overtime, not paying a worker for all of the hours they've worked, not giving workers their last paycheck and refusing to pay workers altogether.

A 2014 report prepared for the Labor Department documented as much as $20.1 million of wage theft per week in New York and as much as $28.7 million of wage theft per week in California.

This fact brief is responsive to conversations such as this one.

Sources

Economic Policy Institute: Wage theft costs American workers as much as $50 billion a year

Economic Policy Institute: Employers steal billions from workers’ paychecks each year

Wage Theft: What is wage theft?

Department of Labor: The social and economic effects of wage violations—Estimates for California and New York

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