What is Wage Theft?

Wage Theft remains a serious problem in the United States. The majority of wage theft violations are due to businesses failing to pay minimum wage. Other examples of wage theft include employees who have their tips stolen, those who work “under the table” or off the books, and employees who are forced to clock out and continue working—and these are merely a few examples.

A $50 Billion Issue
Approximately $50 billion dollars in wages are stolen by U.S. employers nationwide every year. That number is enough to provide 1.2 million people with employment and pay them $20 per hour. In comparison, the combined robberies, motor vehicle thefts, larcenies, and burglaries added up to less than $14 billion in 2012.  States, along with the Federal Department of Labor, recovered approximately $933 million in stolen wages that same year, which was less than 2 percent of what was taken from hard-working employees.

More Grim Statistics
An estimated 83 percent of workers who win their wage theft cases do not see a single penny. According to the 2017 Wage Theft Report, the average weekly earnings of a U.S. employee is $339, of which $51 is stolen. This comes to a total of $2,634 out of $17,616 annual earnings. A study focusing on low-wage industry workers in New York, Chicago, and Los Angeles found at least two-thirds of these employees dealt with at least one pay violation.

Wage Theft Hurts Women, Immigrants, & Latin Americans the Most
Statistics show that immigrants, women, and Latin Americans get hit the hardest of those suffering from wage theft. Over 30 percent of women have their wages stolen compared to less than 20 percent of men, while Latin American citizens lose over 30 percent more than Asian and white people. More than 30 percent of foreign workers also report stolen wages, in comparison to less than 15 percent of U.S.-born workers.

Fighting Wage Theft
Thankfully, people are fighting the war against wage theft. New York has the strongest anti-wage theft laws in the country, while state attorney generals in 45 states have recovered $14 million in wages back for workers. Private attorneys won $467 million in wage theft class-action suits, and the U.S. Department of Labor recovered $280 million. State departments of labor in 44 states took back $172 million in stolen wages.

Wage and labor laws need to be stronger than ever to get rid of this problem permanently. Will adjudication be enough to slow down or prevent this unjustifiable practice in the future? It’s unlikely, but authorities are doing what they can to at least catch some of the violations.

U.S. Cargo & Courier Service, LLC – Independent Contractor Litigation

Hall et al. v. U.S. Cargo & Courier Service, LLC Case No. 2:16-cv-330 (S.D. OH)

On April 13, 2016, we filed a Complaint on behalf of a former delivery driver against U.S. Cargo and Courier Service. U.S. Cargo is a company that provides regional courier and small package delivery services to businesses and financial institutions throughout Ohio, Pennsylvania, and West Virginia.

The Complaint alleges that U.S. Cargo improperly misclassified many of its delivery drivers as “independent contractors,” rather than employees. Because of the alleged misclassification, the former driver claims that U.S. Cargo wrongfully deprived him of rights and protections guaranteed to employees under Ohio and federal law, including overtime, unemployment insurance benefits, and workers’ compensation coverage.

On November 1, 2017, we filed an Amended Complaint adding two additional former delivery drivers as plaintiffs to the lawsuit. In light of evidence that roughly 50 former drivers may have similar claims against U.S. Cargo, we filed a Motion for Conditional Certification requesting permission from the Court to notify other misclassified delivery drivers of their right to join this lawsuit.

On March 9, 2018, the Court granted Plaintiffs’ Motion for Conditional Certification. The Order will allow similarly situated independent contractor delivery drivers who worked for U.S. Cargo throughout Ohio to be notified of the opportunity to join the lawsuit and pursue their duly owed pay.

To inquire further about this case, please call 614-221-4221 ext. 1129 or email srasoletti@barkanmeizlish.com.

Department Manager Sues for Unpaid Overtime

A former Urban Outfitters department manager recently filed a lawsuit against the retail clothing company for violations of the federal Fair Labor Standards Act (FLSA).  The plaintiff seeks unpaid overtime wages resulting from the store misclassifying her as “exempt” from federal overtime laws. Under the FLSA, non-exempt employees are entitled to overtime pay, while exempt employees are not. The plaintiff alleges that she regularly worked over 40 hours a week throughout her employment, but did not receive overtime compensation from Urban Outfitters as required by federal law. The lawsuit claims that the plaintiff’s treatment was part of the store’s broad, company-wide policy to minimize labor costs by classifying all department managers as “exempt” from the FLSA’s overtime provisions.

Whether an employee qualifies as exempt depends upon a variety of factors, including the job duties he or she performs—not the employee’s job title. To be exempt from receiving overtime, a manager must exercise a significant degree of independent decision-making that affects the business, direct or supervise the work of other employees, and have the authority to hire and fire employees. According to the lawsuit, the department managers at Urban Outfitters were actually non-exempt because, despite the management job title, they primarily performed manual labor and did not do any hiring, firing, disciplining, supervising, or engaging in any independent judgment and discretion.

Misclassifying employees as exempt is a common way employers can violate the FLSA. Keep in mind that a job title of “manager” or “supervisor” doesn’t necessarily mean you are exempt from receiving overtime. If you are regularly performing non-exempt work, you may be entitled to unpaid overtime wages for up to the past three years, an additional amount in liquidated damages equal to the unpaid overtime, and employment attorney’s fees and costs.

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