Democrats Fight to Keep Money in Working Family Wallets

Legislators introduce plan to prevent wage theft in the state
Tuesday, December 5, 2017

LANSING — House and Senate Democrats introduced a legislative package to Prevent Wage Theft today which will put money back in the pockets of Michigan’s hardworking men and women. A report from the Economic Policy Institute earlier this year found that more than 130,000 Michigan workers across all demographic groups are losing $429 million annually as a result of wage theft.

“Every person deserves to take home the wages they earn. But across the state, many Michiganders are losing their hard-earned pay to wage theft,” said House Democratic Leader Sam Singh (D-East Lansing). “For the person who is losing $3000 or $4000 a year, that is a make-or-break amount of money and they deserve to get it back. It isn’t a handout and it isn’t a credit — it is money owed to them, that they earned honestly and were denied. While Republicans in Lansing and Washington, D.C. are focused on giving handouts to the top 1 percent, Michigan Democrats are putting working families first with a plan to put more money back in hands of Michigan families.”

The five-bill package, House Bills 5326-5330, seeks to address the varying forms wage theft can take, including things like failure of an employer to pay overtime, offering a “training wage” to young employees, tip confiscation or failure to distribute pay stubs. The legislation would:

  • Pay Workers Back Lost Wages and More. Companies that commit wage theft would be eligible for financial penalties to pay workers three times the amount owed, which would be an increase from the existing limit of two times the amount owed. 

  • Make Enforcing the Law a Priority. The number of staff in the Department of Licensing and Regulatory Affairs responsible for pursuing wage theft violations would be doubled. 

  • Increase Penalties on Bad Actors. The civil penalty for violators would increase from 10 percent annually on the wages and benefits to 100 percent annually. The criminal penalty would also increase from a misdemeanor to a felony, and fines would increase from up to $1,000 to up to $10,000, for repeat wage theft violators.

“People work hard for their money and the paycheck they take home should include every dollar and cent they’ve earned, but while many employers do the right thing, some intend to cheat and we need to put an end to that,” said state Rep. Terry Sabo (D-Muskegon), one of the bill sponsors. “Stolen wages mean stolen opportunities for workers as well as their spouse and kids. We’re introducing these bills because people should be able to save for a new car, home repairs, their kids’ education and their retirement. House Democrats will ensure that a worker’s full earnings go home with that worker and not with their employer.”