California Leads Country in Wage Theft Lawsuits

As an employer, it is your duty to make sure that each of your employees receive fair pay and treatment while ensuring that your company continues to make profits. Unfortunately, many companies in California fail to adhere to these standards and attempt to boost their earnings by forcing their workers to work off the clock without overtime pay.

This is further proven by a recent report published by the Corporate Research Project of Good Jobs First and the Jobs with Justice Education Fund titled, “Grand Theft Paycheck: The Large Corporations Shortchanging Their Workers’ Wages.” This study showcases the dangers of refusing to follow California’s wage and hour laws.

The guiltiest industries

The study examined numerous wage theft lawsuits from 2000 to May 1, 2018 and found some recurring trends. When isolating the industries into sectors, they found that the retail industry had the highest amount of wage theft penalties, totaling over $50 million dollars. This is because Walmart is the most penalized company and contributes to over half of the industry total. The next four most penalized industries were financial services, freight and logistics, business services, and insurance companies.

There were nearly 1,200 successful wage-violation lawsuits against larger corporations in this time period. Out of these settlements, almost half of them came from overtime violation offenses. Rounding out the top five were offenses of misclassification, meal/rest break violations, off-the-clock work, and unlisted pay violations.

Why California has the most

When it came to which state had the most amount of wage theft cases, there was no competition. California had over 90 percent of state court cases and more than half of federal and state cases combined. The report states that the reason California leading the country in wage theft lawsuits is because of the state’s high level of enforcement on wage theft laws. The state continues to strengthen these laws to give local employees the chance to take any wage issues they have to court.

While this report highlights larger corporations that still earn millions of dollars even with these lawsuits, a wage theft case can be devastating to a smaller company. It can cost you thousands of dollars and place your company in risk of bankruptcy. To avoid this, it is critical to review California’s labor laws and Wage Theft Protection Act to ensure that you are compliant with all state laws and aren’t overlooking any essential information. Doing this can help you avoid calamitous lawsuits.

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