Wage theft
Wage theft is a general term for an employer failing to pay wages an employee has legally earned.
Federal law does not use the phrase: claims run under the Fair Labor Standards ActFLSA. The Fair Labor Standards Act (FLSA) is the federal law setting minimum-wage, overtime, recordkeeping, and youth employment standards for covered employment.Click to open the term and state wage-and-hour law. Time records decide most disputes: if you cannot produce accurate hours, you generally cannot rebut an employee’s estimate of hours worked. Automatic meal-break deductions you cannot cancel, rounding that always favors you, and schedule edits after the shift carry the most risk. Penalties, damages, and back-pay exposure vary widely by jurisdiction, so treat the Department of Labor and the state agency as the authority.
What counts as wage theft?
Wage theft covers several distinct underpayments rather than one offense. Hours you know about, or should know about, generally must be paid even when the work was not authorized in advance. The remedy for unauthorized work is discipline under your policy, not a refusal to pay recorded time.
| FORM | HOW IT HAPPENS |
|---|---|
| Unpaid overtime | Hours past 40 in a workweek paid at straight time or not at all |
| Off-the-clock work | Unrecorded time you suffer or permit, approved or not |
| Minimum-wage shortfall | Deductions, tip handling, or piece-rate earnings leave the workweek average below the applicable federal, state, or local rate |
| Misclassification | An employee treated as an independent contractor, or a non-exempt employee as exempt |
| Deductions, final pay, and breaks | Unlawful deductions, withheld final pay, and unpaid meal or rest breaks add exposure under state law |
General information, not legal or tax advice. Apply current federal and state rules with qualified guidance.