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September 08, 2009
Most Low-Wage Workers Say Their Employers Violate Wage and Hour Law

Most low-wage workers say that their employer has paid them less than the minimum wage, failed to pay them the legally required overtime rate, or committed some other violation of wage and hour law, according to a study by a group of professors.

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The researchers conducted a survey among 4,387 workers in low-wage industries in Chicago, Los Angeles, and New York. Low-wage industries were defined as those whose median hourly wage for front-line workers was less than 85 percent of the city's median hourly wage (that is, $12.62 in Chicago, $11.90 in Los Angeles, and $13.07 in New York). However, the actual median hourly wage of workers surveyed was far below those amounts: just over $8 per hour.

Overall, 68 percent of the low-wage workers reported at least one pay-related violation in the previous workweek. The researchers calculated that the average worker lost $51.

Minimum wage violations. Twenty-six percent of respondents reported a wage for the previous workweek that was below the minimum wage in the jurisdiction where they worked, with most of these workers reporting that their wages were more than $1 below the minimum wage.

Overtime violations. Among workers who said they had worked more than 40 hours in the previous workweek, 76 percent reported that their employer had underpaid them for those work hours in excess of 40.

Off-the-clock work. Among workers who said they came in early or stayed late during the previous workweek, 70 percent said their employer failed to pay them for the extra time they worked beyond their regular shift.

Improper deductions. Among workers who said their employer deducted from their paycheck in the previous workweek, 41 percent reported that the the decuctions were made for reasons no permitted by wage and hour law.

The researchers found that the type of violation varied by industry and type of job. For example, minimum wage violations were most frequently reported by respondents in the apparel and textile manufacturing, personal and repair services, and in private households.

In addition, the researchers found that workers of employers that provide health insurance, paid vacation and sick days, and raises were less likely to report wage and hour violations.

“This suggests that employers' decisions about whether or not to comply with the law are part of with the law are part of a broader business strategy shaping the workplace,” the researchers note.


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