Skip navigation
Korbel Latin America Center

Korbel Latin America Center

Research Projects

The Problem

Wage theft includes:

  • Non-payment
  • Misclassification of employees (for example, as independent contractors)
  • Failure to pay overtime
  • Improper deductions
  • Improper use of tipped jobs

You may be a victim of wage theft if you:

  • Work piece rate or off the books
  • You clock out early and keep working
  • You have had tips withheld
  • You don't receive regular breaks

Workers in a variety of industries are victims of wage theft, but in Colorado the prevalence is most dramatic in the construction industry, which claims 21.2% of Fair Labor Standard Act (FLSA) violations and is the largest source of unpaid wages (Stiffler CFI 2014: 3-4; Boiko-Weyrauch 2015).

Why is Wage Theft a Problem

Metro Denver consistently ranks as one of the fastest-growing cities in the country with no expectations that the population boom will cease in the near future. Denver owes this growth to good its job prospects, mild climate and an incredible ability to attract young, college-educated workers. The city's population increase has led to a construction boom that has overwhelmed Denver's post-recession construction labor force. The 2008 crash led to large reductions in the workforce, and the industry has been unable attract enough workers to meet demand. As a result, many smaller operations depend on day laborers and other forms of immigrant labor, despite increased efforts on the part of the Colorado legislature to limit their use.

Kim Bobo's study coined the term "wage theft" to refer to a national epidemic where workers across industries are losing billions of dollars every year in the form of stolen wages, unpaid overtime or misclassification of labor (2008: 7-8). The Colorado Fiscal Institute (CFI) estimated that wage theft affects half a million Coloradans and that workers are losing at least $750 million a year (Stiffler CFI 2014: 1). However, the CFI bases their estimates on data extrapolated from state workforce numbers and the rate of wage non-payment from the NELP 2009 Broken Laws study conducted in New York, Los Angeles and Chicago (Stiffler CFI 2014: 3-4; Bernhardt et al. 2009). Based on findings from one year of qualitative research and outreach, Galemba's research team will survey 400 day laborers in Denver and Aurora about their experiences with wage theft and strategies for seeking redress. This survey will provide necessary data about a segment of the low-wage workforce in Colorado that is particularly vulnerable to wage theft. Beyond documenting the problem, the analysis will inform policymakers on bridging the gap between the availability of legal resources and hesitancy of marginalized populations to utilize them.

The prevalence of wage theft among low-wage immigrant day laborers is well-documented. Valenzuela et. al.'s (2006: 14) extensive study documented that in the two months prior to their survey, 48 percent of day laborers were underpaid for work completed and 49 percent had at least one instance of nonpayment. According to NELP's Broken Laws study, foreign-born Latinos experience the highest minimum wage violations; twice the rate of U.S.-born Latinos and almost six times that of U.S.-born whites (Bernhardt et al. 2009: 43). In New Orleans, Elizabeth Fussell (2011: 611) argues that wage theft is facilitated by the deportation-threat dynamic, meaning that employers exploit workers under the assumption that day laborers are undocumented, whether or not they possess legal authorization. She argues that the deportation-threat dynamic will only be undermined when workers' immigration status "cannot be assumed," and when "potential perpetrators. . . cannot expect to get away with victimizing unauthorized Latinos." Galemba and her team's research examines possible mitigating factors: do more robust labor laws and advocacy generate a climate where employers cannot get away with wage theft? Specifically, the implementation of an amendment to the Colorado Wage Protection Act, which went into effect on January 1, 2015, opened an administrative process for pursuing small wage claims through the Colorado Department of Labor Employment. This process opens new pathways for low-wage workers to recoup wages.

The Legal Landscape

In recent years, Colorado has continued to address workplace rights through legislation. Previously, individuals with claims for unpaid wages could only be eligible for penalties if they made a written demand for payment within 60 days of being owed. Workers could either address these claims in court with private attorneys or a small list of pro-bono attorneys, or by themselves in small claims court. The Wage Protection Act of 2014 (SB 14-005), which amended the Colorado Wage Claims Act (CWCA), established a new administrative process through the Colorado Department of Labor and Employment (CDLE) for low-wage workers to pursue claims for wage theft for amounts totaling $7,500 or less. It also made workers eligible for penalties as long as they made a written demand at least two weeks before filing suit. The amended CWCA applies to private employers in Colorado, but not public employers, and does not apply to independent contractors.

Although wage theft in Colorado could be challenged as either a civil or a criminal violation, there is only one prosecutor in the state who will bring such charges, so claimants are largely left to pursue their claims in civil court. For this reason, wage theft advocates consider the most important part of the new amended CWCA to be the authority that it gives the Colorado Department of Labor and Employment (CDLE) to enforce the wage theft laws through a new administrative process, giving the CDLE both investigative and adjudicative powers, and the ability to levy fines and penalties. The new legislation took effect on January 1, 2015, but there is still a high degree of uncertainty surrounding the new administrative process, and whether or how the law will positively affect wage theft claimants and their advocates.

In order to help the CDLE process claims and to serve as a bridge from often vulnerable workers and the state, Towards Justice and the Wage Theft Task Force have implemented a team of Just Wages navigators. These navigators assist workers with filing claims with the CDLE; in the future Towards Justice and the Wage Theft Task Force will also train navigators to assist workers throughout the claim process. To date, Towards Justice has trained 30 navigators in Denver and Durango. Our research team has implemented a survey to assess the effectiveness of this process in helping workers navigate the CDLE and speeding up the process between incidents and case resolutions. Please contact [email protected] if you are interested in being a navigator!

In addition to supporting the Just Wages navigator program, Towards Justice acts as a clearinghouse by providing free and confidential legal intakes to wage theft victims and then connecting them with appropriate avenues for redress. Towards Justice will take the case of refer the case to a community network of pro-bono and collaborating attorneys to assist with wage and hour cases, or Towards Justice will recommend workers file a wage theft claim with the Colorado Department of Labor and Employment (CDLE). They work with the worker to determine their best option. Towards Justice generally takes on larger cases and those that are class action cases. Other options include making referrals to a network of private and pro-bono attorneys, suggesting the worker file a claim with the CDLE and offering the services of a navigator, or connecting the worker with the Direct Action Team at El Centro Humanitario. The Direct Action Team, led by DU student Amy Czulada and Chris Wheeler is a group of committed volunteers who collaborate with the worker to recoup their wages through the strategies of community organizing and social pressure. Strategies may include contacting employers to clarify wage disputes, delegations to the employer's home or workplace, helping the worker file a claim with CDLE, public demonstrations and/or preparing the worker for small-claims court when negotiations otherwise fail. To become a volunteer, please contact [email protected].

Our research team will implement a survey to assess the effectiveness of the Direct Action Team in helping workers seek redress. The data will also assist the Direct Action Team in documenting its successes and challenges to inform its work.

Visualizing the Problem

Charts and graphs forthcoming