Many people assume that wage theft occurs when an employer denies a worker overtime wages after said worker puts in extra hours. While they would not be wrong, wage theft occurs in several different ways. The denial of overtime wages is just one form of the crime. It is imperative that you understand what wage theft looks like so you can help your North Carolina business avoid accidentally partaking in criminal activity.
According to the National Consumers League, there are six major types of wage theft, with overtime wage theft being the most common. The second most common type of this crime is employee misclassification. Many businesses will classify a worker as an independent contractor to avoid having to pay for protections guaranteed by law such as workers’ compensation, unemployment and payroll taxes. If you misclassify a worker, the state may find you guilty of wage theft.
Another common form of wage theft is minimum wage violations. When given the choice between federal, state and city minimum wages, you must pay your employees at the highest rate. Failure to do so could land you in hot water for wage theft.
If any of your employees work off the clock, even if their “off-the-clock” time involves donning protective gear, and you do not pay them for their time, you may be guilty of wage theft. If you take illegal deductions, or if deductions result in your employees taking home less than minimum wage, you risk being convicted of wage theft.
Failure to pay your employees at all is the most blatant form of wage theft. You may be guilty of this type of theft if you do not pay an employee for all hours worked, including travel time from site to site, if you do not pay a worker for all days worked or if you do not give an employee his or her last paycheck.
This article is for educational purposes only. You should not use it as legal advice.