Is Wage Theft an Epidemic in Philadelphia? What You Need to Know

Workers may lose up to 15% of their paychecks

There’s strong evidence that wage theft is a big problem in the City of Philadelphia.

According to the Sheller Center for Social Justice at Temple University, tens of thousands of low-wage workers in Philadelphia are victims of wage theft on a weekly basis. Throughout the state, workers collectively lose between $19 million and $32 million every week due to wage theft.

Philadelphia recently passed legislation to help workers combat this costly problem. Let’s take a closer look at wage theft and then talk about what you need to know if it’s happening to you.

What is Wage Theft?

Wage theft is an umbrella term that refers to any actions or practices that prevent workers from receiving their legally earned or contractually promised compensation.

Wage theft can include:

• “shorting” of hours, in which a worker is not paid for all of the hours worked
• failure to pay time-and-a-half for overtime
• improperly classifying workers as exempt from overtime
• failure to provide pay in a timely and regular manner or deliberately withholding pay checks
• making illegal pay deductions
• forcing tipped employees to illegally turn over some or all of their tips
• forcing employees to work off the clock

Just how big a problem is this?

According to the report from Temple University, victims of wage theft may lose as much as 15% of their pay. For low-wage workers – who are often the most vulnerable to wage theft – that can equal a loss of around $51-87 per week.

Employers who knowingly practice wage may be likely to offer intentionally confusing explanations for paychecks that don’t quite add up. They may also threaten workers’ jobs if they complain, relying on the fact that many people are not aware of their rights under the law.

The City Steps In

 The Philadelphia Wage Theft Ordinance, which recently went into effect, is designed to help people who believe they’ve been victims of wage theft. The city’s wage theft coordinator may be able to resolve wage theft complaints in the range of $100 to $10,000.

Complaints that fall above or below those ranges may be covered by other city statutes. (Note that victims of wage theft who have been shorted pay in excess of $10,000 would be wise to speak to an attorney, as these cases are likely to be much more complicated.)

It’s also important to remember that the Pennsylvania Minimum Wage Act and the U.S. Fair Labor Standards Act guarantee workers the right to minimum wage, to overtime for hours worked beyond the 40-hour threshold each week, and to be paid the hourly wage that was promised to them.

Contact Us for a Free Consultation

If you believe that you’ve been unlawfully denied compensation, it’s a good idea to speak to an attorney.

Email us at murphy@phillyemploymentlawyer.com, or call (267) 273-1054 for a free consultation.