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Wisconsin Democrats Look to Crack Down on Wage Theft

Dennis Carter

Democratic lawmakers in Wisconsin are aiming to bolster penalties for businesses that commit wage theft, which impacts women employees at a much higher rate than men.

Democratic lawmakers in Wisconsin are aiming to bolster penalties for businesses that commit wage theft, which research suggests affects women employees at a much higher rate than men.

Introduced by seven Democratic legislators in Wisconsin’s GOP-controlled state senate, the wage theft bill would be the latest in a slew of federal and state efforts to give workers a better chance to recover stolen wages from companies and corporations that illegally pay less than minimum wage, compel employees to work off the clock, and don’t compensate employees for overtime hours.

The Democrats’ bill would allow the state’s Department of Workforce Development to charge interest on wages that have not been paid to employees. The proposal would enforce fines upwards of $1,000 per violation against employers who fail to comply with state wage theft laws.

A state circuit court would order an employer to pay back stolen wages in full to an employee, along with no more than 200 percent of the amount of wages in fines, under the wage theft bill.

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“Criminal behavior like stealing workers’ wages should be codified into law,” Stephanie Bloomingdale of the state AFL-CIO said in an interview with Wisconsin Public Radio. “Increasing workers’ legal rights to their hard-earned pay is commonsense legislation.”

Business groups in Wisconsin oppose the effort to penalize companies and corporations that don’t pay employees for the work they do. Other business interests have decried wage theft laws as harmful economic policies, as they have with any legislative push to increase the minimum wage.

James Buchen, lobbyist for Wisconsin Manufacturers and Commerce, told Wisconsin Public Radio that many wage theft claims are unfounded, though he didn’t offer evidence for the claim. Buchen said toughening wage theft laws was unnecessary.

“No amount of statutes [is] going to change the fact that there’s sometimes no money—there’s simply no assets to get after,” he said.

Republicans hold a 19-14 majority in the Wisconsin Senate and a 62-36 majority in the state house.

State legislatures with Democratic majorities across the country have passed wage theft laws with harsher penalties in recent years, as the extent of wage theft—especially in low-paying industries—has drawn national attention.

Wisconsin’s wage theft bill is a stark departure from policies pushed by Gov. Scott Walker and his Republican allies. Walker’s economic plan has spurred Minnesota legislators to invite Wisconsin businesses to their state, which offers many more protections for employees. At least one construction company accepted the offer.

Women and foreign-born employees often are at significantly higher risk of being victims of wage theft than the general worker population.

A study of 2008 data released by the National Employment Law Project, the UCLA Institute for Research on Labor and Employment, and the Center on Urban Economic Development found that 26 percent of workers in low-wage industries in Chicago, Los Angeles, and New York City were paid less than the legally required minimum wage, and three out of four employees who worked more than 40 hours a week were not legally compensated for their overtime hours. Six in ten workers were underpaid by more than $1 per hour.

“We found that many employment and labor laws are regularly and systematically violated, impacting a significant part of the low-wage labor force in the nation’s largest cities,” the study’s authors wrote. “The framework of worker protections that was established over the last 75 years is not working.”

High-profile wage theft cases, including one involving Papa John’s franchises shorting employees of their earned wages, have drawn the attention of labor unions and lawmakers across the country. California lawmakers this month introduced a measure that would allow the state to put a lien on the property of a company or corporation that violated wage theft laws.

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