The Problem of Wage Theft

Abstract

Wage theft inflicts serious harm on America's working poor but has received little attention from policymakers seeking to address income inequality in the United States. This Article provides a comprehensive analysis of the causes of the wage theft crisis and the failure of the current enforcement regime to address it. It argues that existing policy reforms will fail, because they misunderstand the nature of the crisis and the incentives that employers face when deciding to steal workers' wages. It then proposes series of reforms that could work, while arguing that changing the economic calculus alone will be unlikely to solve the problem if social norms remain unchanged.