A Widespread Problem
According to the Economic Policy Institute (EPI), between 2017 and 2020, over $3 billion was recovered for workers who experienced wage theft. Some of the largest companies in America are the perpetrators and they are most likely to stiff the employees who can least afford it. Low-paid workers, undocumented workers, and workers of color are most at risk for wage theft. What’s even more shocking is that despite being caught, many large companies continue to engage in wage theft. “Among the universe of large companies we examined, nearly 600 paid a penalty in multiple cases,” says a 2018 report by GoodJobsFirst.org which evaluated wage theft among Fortune 500 companies.
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What is wage theft?
Wage theft can take many forms. It might include not paying overtime, forcing employees to complete additional work off the clock, minimum wage violations, misclassification of employees as independent contractors to avoid overtime pay laws, violating meal or rest break laws, requiring certain clothing purchases and not reimbursing for them, violating tip laws, or making late or no payments.
Related:Warning Signs a Job Isn’t as Good as It Sounds
Why Companies Still Engage in Wage Theft
According to a report by CBS news, repeat offenders in wage-theft cases are rarely penalized with only around 1 in 4 facing any sort of penalty for their actions between October 2005 and September 2020. “Some companies are doing a cost-benefit analysis and realize it’s cheaper to violate the law, even if you get caught,” said Jenn Round, a labor standards enforcement fellow at the Center for Innovation in Worker Organization at Rutgers University.
Related:These Companies Paid Massive Sums to Settle Lawsuits
Since 2000, Walmart has paid out $1.54 billion for 45 separate wage and hours violations. According to the Good Jobs First report, as of 2018, Walmart was the parent company with the largest cumulative wage-theft penalties. Since then there have been additional suits including in 2022 for $35 million and $5.9 million in 2021 for $10 million, and in 2020 for $8.7 million.
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FedEx is another repeat offender with 23 reports of mass wage theft leading to $529 million total in penalties since 2000. The most recent suit was in 2020 and yielded a $5 million penalty.
Related: 30 Ways Your Employer Could Be Cheating You
Bank of America
As of the 2018 report by Good Jobs First, Bank of America had paid $381 million in wage-theft penalties. It has a cumulative total of 57 employment-related suits against it including those for wage theft.
A whopping 61 employment-related offense suits, including 36 for wage violations, have been brought against Wells Fargo. As of the comprehensive 2018 report, Wells Fargo ranked 4th for the company with the largest cumulative total wage theft penalties of $205 million. The most recent public suit was in 2021 when Wells Fargo was given a $95 million penalty.
JP Morgan Chase
Yet another bank makes the list with JP Morgan Chase ranking 5th for most wage-theft penalties. The total penalty amount through 2018 was $160 million with the most recent suit in 2018 handing the company an $8.3 million penalty.
Since 2000, IBM has had 5 separate wage and hour violations. In total, the company owed $72 million in penalties for the offenses. The most recent violation was in 2014 at IBM India Private Limited which is owned by the American parent company. Earlier wage-theft suits were brought directly against the parent company.
Even the not-for-profit Catholic healthcare company Providence has been accused of wage theft. While most of the employment violations penalties against Providence are related to benefit plan administrator violations, there were 9 separate wage-violations suits. The highest penalty came in 2005 for $49,932.
Thirty-four different instances of wage and hours violations have led to AT&T paying a total of $140 million in penalties since Good Jobs First began tracking the numbers in 2000. The most recent occurrence was in 2014.
State Farm Insurance
State Farm’s cumulative wage theft total in 2018 was $140 million making it the 6th largest perpetrator. The largest settlement was in 2005 for $135 million but then State Farm was also fined again in 2013 for $5 million.
United Parcel Service (UPS)
As of 2018, UPS had been fined $138 million in wage-theft violation penalties to its workers. Since then, several smaller penalties have been issued with the most recent in 2022 for $48,100.
ABM Industries is a facilities management company headquartered out of New York City. In 2018 Good Jobs First ranked the company 9th for most cumulative wage-theft penalties with ABM Industries being penalized $128 million. Since then, the company has had additional violations including one in 2022 for $140 million more than its entire cumulative total in 2018.
Tenet Healthcare is a for-profit healthcare services company headquartered in Dallas, Texas. In 2018, it had been charged $127 million in total wage-theft violations. The largest individual suit led to an $85 million penalty in 2009 but since 2018, no additional violations have been brought forth.
You’re in good hands unless you are one of the Allstate employees who had a cumulative total of $122 million allegedly stolen from their wages through 2018. Allstate was penalized a massive $120 million in 2005 and $5.5 million again in 2018. Since then, there have been no additional penalties.
Ecolab, based out of St. Paul, Minnesota, specializes in water treatment and purification. According to Good Jobs First, Ecolab was penalized $111 million total in wage-theft-related instances up through 2018. The most recent violation was in 2021 when Ecolab was penalized $2.5 million.
Like many other large banks, Citigroup has also been penalized multiple times for wage theft to the tune of $110 million through 2018. The largest violation led to a $98 million penalty in 2008, but since 2017 there have been no other accusations.
Cerberus Capital Management
This company is the parent of popular chains like Albertson’s and Safeway grocery stores among others. In total, the company had been fined $103 million as of Good Jobs First’s 2018 report making it the 14th worst company for wage theft at the time. It had 42 separate occurrences brought forth including one for $53.3 million in 2007.
Farmers Insurance Exchange
In 2001, the company was penalized $90 million for wage and hours violations, one of the largest single fines to date. The total wage-theft penalties the company had as of 2018 was $102 million. Then again in 2020, the company lost another suit and was penalized $5.4 million for wage theft.
Although low-wage workers often face wage theft, even employees of tech companies, like Microsoft, are not immune. Microsoft ranked 16th for the largest wage-theft penalties, according to Good Jobs First, with a cumulative penalty amount of $102 million. The IT company has only had 2 public suits brought against it, one in 2000 and another in 2014. The larger of the two, from 2000 totaled $97 million in penalties. According to records, “These cases, which were originally filed in the early 1990s and had a long history in the courts before reaching settlement, involved challenges to Microsoft’s classification of workers as temps, freelancers, independent contractors and employees of staffing firms in order to deny them benefits and overtime protection. The workers involved were often described as permatemps.” Since 2014, there have been no additional reports according to the Violations Tracker.
A total of $102 million has been awarded to workers due to wage theft on the part of the investment company, Morgan Stanley. Six separate suits from 2006 to 2016 were reported with the largest settlement coming in 2009 for $50 million.
Computer technology company, Oracle, is another major American company accused of wage theft. According to the Good Jobs First 2018 report, the company had been penalized a total of $92 million for wage theft. The most recent suit was brought forth in 2022 for $53,279 and is still pending.
Sycamore Partners Management
Sycamore Partners Management is best known for being the parent company of business supply retailer, Staples. Its penalty total through 2018 was $89 million. Multiple multi-million dollar suits were brought against the company between 2006 and 2018 with the most recent, and smaller suit coming in 2019 for $165,000.
As of 2018, retail and pharmacy giant CVS had 44 cases brought against it, one of the most of any other large company investigated. The total penalty value of all these came to $87 million. Things have not improved since 2018 as there have been multiple smaller suits and two multi-million dollar suits brought forth since then. The largest of these came in 2021 for $10 million relating to training pay, or rather, lack thereof.
Before filing for bankruptcy in 2015, RadioShack had its share of wage-theft allegations. In 2002, across all major companies, the total wage-theft penalties numbered $117 million. RadioShack had the largest single case which settled for $29 million. Across its four wage-theft violation cases, RadioShack was penalized a total of $85 million.
Tyson foods, one of the world’s largest meat-processing companies has also been accused of wage theft. By 2018, the penalties totaled $75 million. Its most recent reported violation, however, was in 2017.
According to the EPI, this national design-build company, “failed to pay employees the required minimum wage and overtime wages did not provide paid sick leave as required by D.C. law and evaded D.C.-imposed payroll taxes”. As a result of the 2020 settlement, Power Design had to pay workers $879,056. The company owed an additional $1.8 million to the District of Columbia.
Another construction company, RDV construction was fined $12 million by the California labor commissioner for unpaid wages between 2014 and 2017. According to the EPI, multiple checks to workers bounced, and the company required nine-hour days without breaks or overtime pay for multiple workers.