Peters Announces Investigation into Illegal Practice of Wage Theft

Investigation Will Seek Workers’ Stories & Examine Illegal Actions That Deprive Workers of Billions in Wages Every Year

WASHINGTON, DC – U.S. Senator Gary Peters (D-MI), Ranking Member of the Senate Homeland Security and Governmental Affairs Committee, today announced he is conducting an investigation into illegal wage theft practices that harm American workers. Wage theft violates basic fair pay laws and denies workers a fair wage for their work. It takes many forms, including failure to pay the applicable minimum wage, failure to compensate employees for overtime, and misclassifying employees as “independent contractors” to avoid paying certain benefits or taxes. Senator Peters has directed the minority staff on the Homeland Security and Governmental Affairs Committee to conduct an investigation focused on these and other harmful actions that prevent employees from receiving all of their hard-earned pay.

“If you put in a hard day’s work, you deserve to get paid for it. Yet every day, workers in Michigan and across the country are denied wages or benefits they have earned on the job,” said Senator Peters. “This investigation will help expose wage theft and develop ways to hold employers who break the rules accountable for actions that hurt hardworking families.”

Click here to watch Senator Peters discuss his wage theft investigation.

Wage theft has serious financial consequences for workers and businesses who are trying to play by the rules. The Economic Policy Institute estimates that American workers are shorted as much as $15 billion in wages each year due to minimum wage law violations. Michigan has the 5th highest total of unpaid wages in the country due to minimum wage violations. According to EPI, from 2013 to 2015, roughly $430 million in wages were improperly withheld from Michigan workers. Misclassifying workers as “independent contractors” also negatively impacts law-abiding taxpayers. According to the U.S. Department of the Treasury, millions of employers nationwide have failed to pay more than $45 billion in employment taxes. These practices deprive the federal government of billions of dollars in unpaid employment taxes that are used to fund Social Security, Medicare and other benefits. In Michigan alone, a study released in 2008 found that Michigan loses tens of millions of dollars annually from misclassification practices – depriving the state of dollars for projects like highway and infrastructure upgrades, educational programs, or public hospitals.

As part of the investigation, Senator Peters would like to hear from workers who have been victims of wage theft, including instances where rightfully earned wages have been withheld or wages or benefits have been denied for work as an employee or independent contractor. Workers who have experienced wage theft can share their information with the Homeland Security and Governmental Affairs Committee. The information received will be evaluated to better understand the scope and severity of wage theft nationwide, and may help the Committee address this growing problem.

If you have information to share regarding your personal experiences with wage theft, please visit https://www.hsgac.senate.gov/contact/investigations.


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