In cases of wage theft, Texas workers lose the most money, study says

Immigrants are particularly vulnerable to wage theft. (Michael Ciaglo / Houston Chronicle) Immigrants are particularly vulnerable to wage theft. (Michael Ciaglo / Houston Chronicle) Photo: Michael Ciaglo, Staff Photo: Michael Ciaglo, Staff Image 1 of / 1 Caption Close In cases of wage theft, Texas workers lose the most money, study says 1 / 1 Back to Gallery

In many low-wage industries, it's all too easy for employers to short workers on the wages they're owed — either because it's done in a way that employees don't notice, or they need the job too much to protest.

How much this costs workers is difficult to pinpoint. But by one estimation, workers in the 10 largest states alone lose out on billions, according to a new report from the Washington-based Economic Policy Institute.

To put numbers on the phenomenon of "wage theft" — a broad term for practices such as not paying proper overtime, requiring work off the clock, denying legally required meal breaks, and misclassifying workers as independent contractors — the left-leaning think tank looked at data from a monthly Census Bureau survey that asks people how much money they make.

The findings were striking. On average between 2013 and 2015, in the 10 largest states, 4.1 percent of respondents report that their hourly rate is less than the minimum wage in their state, which researchers concluded must constitute a violation of the law. That's about $8 billion stolen from 2.4 million people annually.

(Some workers are exempt from the minimum wage, such as some students and people with disabilities; this study includes only those to whom the minimum wage applies.)

Among the 10 largest states, Texas ranked near the bottom on the prevalence of wage theft, with just 2.7 percent of minimum wage-eligible workers, or 265,000, getting paid less than they should. That compares to 7.3 percent of workers in Florida.

Those affected in Texas, however, lost the most money: $85 per week, compared to $64 per week on average across the 10 largest states. So, fewer people were shortchanged in Texas as a percentage of the population, but each worker lost more money.

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Why could that be happening? Dave Cooper, the EPI researcher who wrote the report, thinks it may have to do with lack of enforcement. Although the Texas legislature increased penalties for wage theft in 2011, the Texas Workforce Commission, which handles those claims, has little power to investigate them or punish violators.

"There's reason to think that thieving employers in Texas probably are not that worried that they'll ever be caught," Cooper says, "and even if they are, the penalty is just a slap on the wrist."

Texas also has a larger share of undocumented immigrants, who are particularly vulnerable to wage theft, since speaking up could put them at risk of deportation.

Under the Obama administration, the Department of Labor had stepped up investigations and prosecution of wage violations, recovering tens of millions of dollars for workers. It's unclear whether President Trump's more employer-friendly administration will continue those efforts.

The EPI report also comes as activists highlight poor working conditions across the South. On Tuesday, the Austin-based Workers Defense Project and researchers at the University of Chicago released an exhaustive report on workplace injuries, lack of benefits, and low wages for construction workers in Texas, Georgia, Florida, North Carolina, and Tennessee.

Houston topped the list for heat-related illnesses, which strike one in six construction workers, according to surveys.