Wage and Identity Theft: Violation of Human Rights

Wage theft is a major issue all over the world today and my hypothesis is that wage theft affects the most vulnerable of employees at a much greater rate than others. We can define wage theft as “the denial of wages or employee benefits rightfully owed to an employee.” Wage theft is the committed when an employer pays less than the minimum wage, less than the wage that was agreed upon, the full amount of hours worked by the employee, all overtime hours, or the full amount of tips that were rightfully earned by an employee. According to University of California’s Labor Center, wage theft costs workers $26 million a week. That’s only one state in America and the effects of wage theft are that extensive. To think of the wage theft being committed throughout the entire country would leave you mind blown at the ability of employers to get away with what is essentially theft.

Overtime violation is the most common form of wage theft.The act of paying less than the minimum wage has the most intense effect on society because it affects the most vulnerable of citizens. These vulnerable citizens include minorities, women, minors, and especially undocumented immigrants. A survey of over 4000 low wage workers in major U.S. cities found that more than 75% of them had not received overtime payment from the week prior, 70% had their meal breaks reduced in duration or completely cut off. Both of these are violations of labor laws in America. The problem is, do these workers have enough access to justice to be taken seriously or can they even compete with the employers they are fighting against?

Illegal Immigrants and Wage Theft

Wage theft is a huge issue with low income people and is especially problematic for illegal immigrants. Wages below the minimum wage are common in agricultural field work, child-care, clothing manufacturing, restaurant work, and construction. One article states “Low-wage immigrant workers are particularly likely to be victims of wage theft, in part because of their vulnerability to exploitation as a result of language, education, and citizenship status.” I believe that specifically in America, there is a growing ability of racial prejudices to show. Not that there is an increase in racial prejudice in people’s private views, but specifically that the current political climate and the rhetoric of the President of The United States is allowing those who held prejudicial views beforehand to show them in the light. These views are becoming increasingly accepted and it is causing problems for anyone who does not fit the bill of what “America” should look like. This seems to me to be a less dramatic mirror of a certain movement in Europe in the mid 1900s but I will save my political viewpoints. Because of a growing courage of racism in the U.S., immigrant wage theft is becoming a major problem. The intense anti-immigrant fight in America makes it so that immigrant workers are much more susceptible to wage theft by employers who feel empowered to show their true colors by the Trump administration and their views. The fear struck into the minds of illegal immigrants allows employers to bully and take advantage of them with threats of visits from ICE. Wage theft as a neglected public health problem: an overview and case study from San Francisco's Chinatown District.

One case in particular involved an undocumented immigrant in the state of California who was being constantly paid less than the agreed upon wage on his paycheck and after complaining to his boss, he received a text which read: “illegals like you should return to their countries, soon immigration will visit you.” In this specific case, the man took to the CLC, or California Labor Commission, and filed a petition to recover unpaid wages. The court found that his employer was liable to pay unpaid wages and guilty of immigration retaliation.

Specifically in the U.S., immigration retaliation is on the rise. Immigration-related retaliation increased 10 times since 2016, leading to an overwhelming amount of evidence to support my assumption that the Trump administration is to blame. Lawyers and immigration rights activists actually believe that these numbers are on the low end of things when compared with the number of undocumented immigrant workers who are too afraid to report their experiences with immigrant retaliation. In Australia, over 75% of international students and backpackers have the knowledge that they are being underpaid. They accept this payment of less than the standard wage because they believe it is standard treatment on a visa. [8: Id.] [9: Kaine, S., Josserand, E., & UTS Centre for Business and Social Innovation. (2019, July 30). Shocking yet not surprising: wage theft has become a culturally accepted part of business.

Access to Justice by Illegal Immigrants

In the large majority of situations, the federal employment laws do actually protect undocumented immigrant workers. But, unfortunately, the remedies that are available to them are significantly less than that of legal citizens. In one case, the Supreme Court decided that the Immigration Reform and Control Act of 1986 prevented an illegal immigrant from being able to recover earned wages in retrospect. This case was decided even in light that the worker was able to successfully argue that they were the victim of a National Labor Relations Act violation on the part of the employer. The problem is not the accessibility of justice that leads workers to avoid submitting claims against their employers for violations of federal employment laws but rather that workers fear the threat of retaliation by the employer. I’m sure you can realize how serious these threats of retaliation would be taken by employees that are undocumented.

Retaliation against Undocumented Immigrants

Okay so to reiterate, employee bears the burden to first report the alleged wage theft. Logically, this may leads to several workplace problems and retaliation by their frustrated employers. In countries, like America, where the wronged employee bears the burden of reporting violations against their own labor protections, we know that employers will retaliate against the worker. Retaliation is carried out in several different ways. Some of the more frequently used forms of retaliation against workers include firing, demoting, hours reductions, less favorable shifts, harassment, and other forms of unfair discipline.

You may not believe that retaliation by employers is very common and so we should not focus on it so much. This is simply not the case. In a survey by the US Bureau of Labor Statistics of over 4000 low-wage workers, 43% of people who made a wage complaint against their employer have experienced some form of retaliation. In one other survey performed by the Raise the Floor Alliance and National Economic and Social Rights Initiative that surveyed 275 workers in Chicago, Illinois, nearly half had reported retaliation after their complaints.

With regards to undocumented workers, retaliation takes a much more serious turn. Although many employment laws contain an anti-retaliation provision making it illegal for an employer to retaliate against an employee who is exercising a legal right to report illegal discrimination, in practice it becomes much more different. An employer who reports an undocumented worker to immigration would likely be in violation of retaliation law but that fact would do little to comfort someone whose live is about to be upended by deportation. The LA Times actually reported on a case where cleanup workers after two major hurricanes had made complaints about discriminatory pay. The employer contacted ICE officials and although the employees had a legitimate claim against their employer, they were still in violation of federal immigration laws and therefore proceedings to deport were pursued. Employers will likely be willing to risk paying a fine in order to send a message and save more money in the long run. Because of the weighing of costs and benefits, in most instances, undocumented immigrants will accept the discriminatory treatment carried out by their employees and seek no judicial remedies.

Misclassification as Certain Workers as Independent Contractors

Another issue that may be found in terms of legal remedies for workers that are the victims of wage theft is the misclassification of them as independent contractors. The legal difference between employees and independent contractors is extremely important and has vast consequences for the legal remedies that are available to them. Only workers labeled as “employees” enjoy the protection of law. Specifically, employees enjoy the protection of Employment and Labor laws but independent contractors do not. Certain companies, especially ones that create new forms of work like app-based companies attempt to qualify their workers under the title of independent contractors as this allows them to take on less responsibilities and to save money. For example, Uber classifies themselves as a technology company that brings drivers and passengers together through an app. Therefore, the company is able to qualify the drivers under the title of independent contractors. In a recent landmark court decision that aimed to clarify this legal uncertainty, California set out their AB5 bill which qualifies the workers of App-based companies like Uber drivers as employees rather than independent contractors.

Uber would prefer to avoid the social security contributions that would be required by having employees. Employment protection is also required if their drivers are seen as employees. This shows how much power employers have over their employees simply by manipulating the terms of employment. If they are classified as independent contractors, this leads to them not having access to justice under employment law because technically they are not legally employees.

Like I said, employees are entitled to the protection of several state and federal laws that are unavailable to independent contractors. Examples of these laws include the FLSA. The FLSA is the entity that governs overtime wages as well as minimum wage laws in America. This entity does not apply to independent contractors so they have no rights to seek a judicial remedy when an employer fails to pay them the overtime or minimum wage. The laws that protect workers against discrimination as well as retaliation also do not apply to employees labeled as independent contractors. The Civil Rights Act of 1964, The Equal Pay Act, The Age Discrimination in Employment Act and many more do not apply to independent contractors leaving them many times without any access to justice. Employers are also not required to verify that the contractors are citizens of the U.S. or at least have a work visa. Because of this, employers that misclassify their employees as independent contracts are able to exploit their low-wage immigrant workers. As I mentioned before, because of fear of repercussions or deportation, the large majority of wage theft instances against illegal immigrant workers go unreported. One last way that independent contractors are forced to accept the practices of their employers is by not being covered by the National Labor Relations Act. This allows employers to prevent their “independent contractors” from forming a union to protect themselves.

Prosecution or Civil Remedy?

When you think about the process for gaining access to justice, there is a large difference between a civil matter and a criminal matter. The biggest difference is that violations of the criminal code are much easier on a citizen in terms of time they may have to commit to pursuing justice. If an action violates the criminal law, victims get much better protection because of the idea that the state is the entity that prosecutes these crimes and the victim therefore bears less financial risk. Prosecutors are paid by the government, so the victim of a criminal case is exempt from paying legal costs. This is a massive advantage for the victim, and especially important when a victim is of a lower class and has less money. If the victims of wage theft have to pursue a civil action against their employer, they bear the burden of proof as well as having to find and pay a lawyer to represent them. Because of this problem, many low-wage employees decide to seek no recourse at all and simply are forced to accept the wage theft as a norm.

Hegemony In The Workplace And The Global Poor

The idea of employers forcing workers to accept the norms of wage theft is in line with the idea of hegemonic dominance. According to Antonio Gramsci, by making sure that subordinates accept and comply with a dominant set of practices and institutions, the dominant group’s, in this case the employer’s, practices become part of the common sense. “Theorists of work and class relations have argued that organizational processes within the monopoly induce employees to identify with the firm and consent to the social relations of production.” As Nancy Fraser mentions in her paper on social exclusion and the global poor, important injustices may not be located on just single scales but instead may be a plurality of scales. The idea that certain injustices may be best.