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Wage theft responsible for more losses than robberies

A recent report has found that wage theft against low-wage workers totals about $280 million for 2012, which is double the amount that is stolen through robberies on the street, bank robberies, and gas station and convenience store robberies. Yet for most of us we don’t think about unpaid or underpaid overtime as theft in the same way we would if someone stopped us on the street and took our money.

Wage theft is typically thought of in the context of low wage workers, particularly those who are paid hourly. Wage theft can come in the form of being paid less than minimum wage, being denied tips, or being forced to work off of the clock. Yet, an upcoming settlement agreement in an antitrust lawsuit shows that wage theft can happen in many other ways as well. In this case, software engineers alleged that competing companies colluded to suppress pay increases that would otherwise accompany a new job.

The system stopped the normal process of competitors vying for top talent, costing engineers about $3 billion in pay from 2005 to 2009. This is an interesting case because it combines elements of antitrust law with elements of employment law. Anti-trust laws are designed to maintain healthy competition in the marketplace so that the prevailing rates for goods and services are set by competition rather than an powerful single entity. At the same time, employment laws protect workers from being the victim of aggressive competition and efforts by management to lower overhead.

This case shows the seriousness of the problem of wage theft and reminds readers that unfair pay can happen to anyone in any sector of the workforce.

Source: The New York Times, "Wage Theft Across the Board," The Editorial Board, April 21, 2014

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