Employers In Pennsylvania Steal Millions From Their Workers, Temple Study Says

Pennsylvania employers are stealing millions of dollars from their employees, according to a new study published by law students at Temple University.

The practice of “wage theft,” where employees are underpaid or not paid at all, is a surprisingly common malaise spreading across the state, the study says.

The study estimates that up to $32 million in worker wages are stolen per week in Pennsylvania, a catastrophic loss for a citizenry that already indiscriminately struggles to pay rent based on their wages compared to the rest of the country.

Over 400,000 workers experience a minimum wage violation and over 300,000 experience an overtime violation per week, the study says.

The study, entitled, “Shortchanged: How Wage Theft Harms Pennsylvania’s Workers and Economy,” concludes that wage theft has a very detrimental effect on the state economy, because it is taking money away from workers that would spend it on the local level. Small businesses, in particular, suffer.

All low-wage and hourly workers were at higher risk for wage violation, but one particularly victimized industry was home care workers. Over 90 percent of all home care workers were victimized by pay violations, the study finds.

“I was so frustrated and I wanted to break down and cry because I couldn’t spend another week not being able to feed my children, having to choose between bread, eggs, or milk,” a woman identified as Natasha told the study’s authors.

The problem is not just a general Pennsylvania problem - the Philadelphia area, including Montgomery and Chester Counties, are particularly hard hit, the study finds.

In an average week in Philadelphia, Chester, Montgomery, Bucks, and Delaware counties, 128,476 workers encounter a minimum wage violation, 105,458 experience an overtime violation, and 83,344 are victimized by an off-the-clock wage violation, the study reports.

Stock office clerks and retail salespersons were two of the most affected industries.

The authors compiled four key steps that the state can take to begin resolving the issue:

• Creating stronger penalties for employers who commit wage theft
• Increasing funding to DLI for enforcement of the wage and hour laws
• Working more closely with community groups to identify enforcement priorities for DLI
• Strengthening enforcement with wage liens and revocation of licenses

Under existing law, prosecuted wage thieves can receive prison time, the study reports.

The study was written by Temple Law students Amanda Reed (‘15), Andrea Saylor (‘15), and Margaret Spitzer (‘15).

Research assistants Elyssa Geschwind (‘14), Solaris Power (‘15), and Philip Jones (’16), along with supervising and editing professors Jennifer Lee, Jaya Ramji-Nogales, Len Rieser contributed to the report’s publication.