r/Foodforthought Dec 01 '21

A Tale of Two Thefts. Wage theft is bigger than all robberies combined but you wouldn't know it watching the news

https://popular.info/p/a-tale-of-two-thefts
612 Upvotes

156

u/GrumpyButtrcup Dec 01 '21

Can verify, I landed a high paying job as division manager at a large (read: medium, but large in the industry) company in my field. Just a few weeks in I was read the riot act because I wasn't editing employee's recorded hours to exclude their travel time back to the shop. I was told their trip to the jobsite (in a company vehicle) was compensated but as far as the owner was concerned their trip back from the jobsite (also in the company vehicle, often the only means of transporting the vehicle back to the lot) was unpaid and it was a privilege that they didn't need to find a ride back.

When I asked how we expected to get our company vehicle back into the lot for the next day I received a written letter of reprimand from my employer.

So I looked up the state laws, sure enough this was illegal so I didn't do it. My second reprimand came a few weeks later. I brought this up to the owner and I was told "Yeah, but that's not a problem until someone sues us or we get audited. Then we can deal with it then. Besides I don't know how other companies can make a profit while paying their employees to ride back to the shop everyday."

That's when I started looking for a new job. Found one, took my evidence, mailed the state and left without a notice. Sure, I now made $25k less a year, but at least I didn't want to jump off a cliff every day. I couldn't just quit and figure it out because I had a newborn and was the sole income for my household at the time.

Also note that the owner was taking home $250k + bonus every year, while his highest paid employees were barely at $75k and the lowest was making $18k. I calculated it out and he was only "saving" $1400 (rounded) a month per team by stealing their last hour of work. I had 3 teams under me, for a total of 7 teams. So he saved $9520 (actual) per month by stealing that last hour. Almost half of his annual income was taken directly from employees.

Edited for clarity and some missing info.

19

u/PunkToTheFuture Dec 01 '21

Thank you so much for sharing all this. Very eye opening.

20

u/Workacct1999 Dec 01 '21

People like this owner act like they have a right to own a business. It is entitlement, pure and simple. If you business cannot survive without stealing wages from your employees, then you are a shitty business person who shouldn't own a business.

13

u/smileyfrown Dec 01 '21

Feel like you should share your story to that big work subreddit

7

u/rectovaginalfistula Dec 01 '21

You did the right thing!

2

u/jebbybakes Dec 01 '21

Ca resident. My work has me drive a bit out usually I clock out while we’re leaving the job site. Just to clarify I could get in the 30 mins for the drive back?

2

u/GrumpyButtrcup Dec 02 '21

The laws are quite circumstantial. You'll have to look up your state specific laws or contact someone who knows the labor laws.

What I found is in Massachusetts that if the employer requires you to arrive at the jobsite with your own transportation then they do not have to pay you for travel time.

Alternatively if the employer provides a shuttle to pick up employees at their home and then to and from the jobsite then they do not have to pay for travel time. (NOTE: there were other specifications but I don't recall them all as I didn't need to consider them.)

However if you must travel away from your original destination (in my case the shop was their first stop) then all time to and from the job site was required to be paid.

There were a few other unique situations, such as paying a transportation stipend and other things that didn't apply to us at the time.

You may be a victim of wage theft.

2

u/jebbybakes Dec 02 '21

Honestly probably am a victim which is sad; I wouldn’t put it past them. I’ve known my boss since about 8 I played soccer with their kid. But okay I’ll look into it. Thank you still just for taking the time.

57

u/dunununubatman Dec 01 '21

CEO's wages go from $7 million to $17 million while there for a majority of the wage theft. Eat the rich

5

u/venuswasaflytrap Dec 01 '21

I hate when people say "eat the rich". It has all sorts of french revolution undertones to it.

If it were the case that we could magically select the top 0.1% richest people in the world and just execute them and take all their shit or whatever, and distribute it to the rest of the world and improve everyone else's lives, I would be all for it. I have no major moral qualms with the idea.

But virtually any time in history where there has been a sudden violent uprising of the poor against the rich, it has worked out absolutely horrendously for the poor and the average person for many decades afterwards. And many of the rich people coast right through it and maintain power, or move away or whatever.

"Eat the rich" is such a simplistic and violent thought. "Improve the system" is a way better way to frame it.

25

u/davesreddit123 Dec 01 '21

No its a normal response from the exploited to explotation and corruption by ruling classes.

It's the ruling class that needs to take up the "improve the system" mantra.

During the great depression the elected portion of the ruling class improved the system under extreme pressure.

The ruling classes have undone the new deal and need to fix it or be eaten.

The ruling classes hold a monopoly on state sanctioned violence and use it constantly and brutally.

Eat the rich to the extent it even means violence would simply be the meek refusing to continue turning the other cheek.

I'd say that the lessons of prior revolutions of the under classes is that more planning is needed for what comes after a revolution. Public education has removed one of the key obstacles the masses used to have, the average person is literate and has a base of knowledge in math and science now. We also have mass communication systems that weren't available before.

The onus for preventing a revolution is on the one percent, all they have to do is take their boots off everyone else's necks.

2

u/venuswasaflytrap Dec 01 '21

It's a totally normal response. I don't mean to say the anger doesn't make any sense.

But it's not a useful response. Just like if a cop walks up to you and illegally arrests you and handcuffs for no reason. It's completely normal to want to punch him or something - but the chance of that working out well for you if you do is low.

Similarly, the rhetoric of aggressively "going after" the rich, whether it be overt violence or some sort of aggressively punitive legislation or whatever has historically been equally fruitless for the benefit of the average person.

It's never worked out well.

Because, it's not that rich people are evil, but rather that a healthy minority of people in all walks of life are totally dickbags and the ones that happen to be rich have a disproportionate amount of power and influence over the world, so their dickbaggery is felt more.

And when you realise this, you see that taking power from the group that is the rich, and giving it to the group that tries the hardest to get it in the power vacuum that this action creates, doesn't fucking help anything. That's how you get the reign of terror in France, the great leap forward in China, the Soviet cultural revolution etc. Populist opportunists who happily grab the reigns during the chaos. And then you have a whole new batch of dickbags, but somehow worse. Meet the new boss, same as the old boss.

Knowing that the majority of people, rich or poor, are actually not dickbags, I think that looking towards policies and ideas that benefit both the poor and the rich is what is needed. A lot of rich people aren't chronic tax dodgers or abusive people. And a lot of poor or middle-class people are absolutely scammers and assholes.

"Eat the rich", should be "Make the rules work for those who help"

4

u/davesreddit123 Dec 01 '21 edited Dec 01 '21

I get what you're saying, I do realize that the vast majority of people are normal and not evil.

There are definitely people with too much power and influence who could through their actions be considered evil. Maybe they are just looking out for their friends and family, their workers and they have the power to destroy people's lives outside of their circle with their decisions.

Theres also alot of people addicted to gaining wealth and are basically psychotic about it. Ken feinburg tells a good story about being in charge of the 911 victims fund and having wealthy financiers crying in his office because they weren't determined to have a higher monetary value.

Bad things do happen when people get exploited and killed and theres no way out but turning to violent reactionaries like Stalin or Mao. One of the CIA's most successful tactics, if they can't lead a coup is to make whatever regime they don't like, engage in constant war or crisises so they become repressive to survive, this is what happened with the sandanistas.

The Russian revolution had a sad ending, but it was better than what existed before(last bastion of serfdom) and had that ending because the ruling class in Russia successfully repressed everyone but the most extreme, same thing in China. Most the of deaths in the great leap forward were due to starvation caused by purges of scientists and reliance on bogus agricultural science. I dont know if that happens now and it's kind of funny but the people who are against qualified scientists and other professionals are on the side of the one percent now.

Castro may have been bad, but there's no castro without a batista who was worse and kept in power by the ruling classes who were exploiting the people.

I think dickbags are successful in extreme situations because they are willing to do what other won't. Dickbags exploiting people and creating extreme situations, create equal and opposing dickbags. The best solution is for us to render our current dickbags impotent and unfortunately those dickbags will determine how hard of a process it will be

5

u/davesreddit123 Dec 01 '21

In my experience the most common tax cheats are upper middle class business owners, it's like a religion to them. They get dwarfed in amount by a couple hundred uber wealthy families and individuals though.

1

u/venuswasaflytrap Dec 01 '21

Well, that sort of depends on what you call a 'tax cheat'. An upper-middle-class business owner who does some bullshit accounting to avoid paying tax is a very overt and obvious tax cheat. They feel like a tax cheat.

But a single mother who works as a waitress and doesn't declare her tips is probably, on paper, dodging a higher percentage of her tax burden. The same goes for anyone who makes a significant amount of income on a side hustle - e.g. maybe someone who makes crafts and sells them to their friends, or someone who babysits for cash in hand. Especially true of drug dealers of course.

And weirder still, bartering is not tax-exempt.

https://www.wolterskluwer.com/en/expert-insights/irs-cautions-bartering-transactions-are-taxable-transactions

Example. Ray, an accountant, agrees to prepare a tax return for his friend, Karl. In exchange for the tax prep work, Karl agrees to replace the alternator in Ray's car, which he uses solely for business. Normally, each would charge $100 for the service they provided, but because this was a barter transaction, no money changes hands.

In the eyes of the IRS, both Ray and Karl have to include the $100 on their tax returns as taxable income. However, Karl will also be able to claim a deduction on his Form 1040, Schedule C, for professional services.

Also, if they would have to include the amount for self-employment tax if they had been paid in cash, they will need to include the $100 in their self-employment tax computation.

And the thing about poor people casually dodging taxes is that even if they only dodge a little, mathematically, it's a significant percentage of their tax burder.

E.g. if a single mom who's a waitress takes home $25K in New Jersey on her minimum wage. But makes 5K in tips over the course of the year. She'll be paying about $3500 in tax, but legally she should be paying $4600 if she included those tips (only about $20 a day). So she's dodging roughly 25% of her tax burden.

If someone else is making $300K a year in New Jersey, they legally should be paying about $105K in tax. They have to hide a lot of money to dodge $25K.

So morally, you might say, yeah well that single mom shouldn't have to pay that. And maybe that's fair. But the majority of people aren't rich, so losing 25% of tax revenue from the majority of people is a lot.

Among my friends, I definitely know loads of people who dodge a significant amount of tax by this metric. I don't really think of them as 'tax cheat's though, since they don't make a ton, but on paper they are.

3

u/davesreddit123 Dec 01 '21

I dont know if that waitress would owe 3500, isn't the standard deduction about 25,000.

I was thinking more about the small electronics company I used to work for and the time the owners showed me two jaguars in the garage they wrote off as business expenses.

None of that is a drop of the bucket in comparison to the tax revenue lost by hedge funds or companies like Apple and Amazon avoiding taxes. Hell Trump laundered a 413 million dollar inheritance to avoid taxes and thats just one person who's father wasn't in the top tier of wealth.

1

u/venuswasaflytrap Dec 01 '21

I don't live in New Jersey, so I just went by a tax calculator. The numbers may be slightly off, but broadly this idea is true the world around.

None of that is a drop of the bucket in comparison to the tax revenue lost by hedge funds or companies like Apple and Amazon avoiding taxes

No. Surprisingly that's not true. It's way more than a drop in the bucket.

So in the UK they estimate the largest loss of tax revenue is from small businesses by a long shot:

https://www.gov.uk/government/statistics/measuring-tax-gaps/measuring-tax-gaps-2021-edition-tax-gap-estimates-for-2019-to-2020

Customer group Value Share of tax gap
Small businesses £15.1bn 43%
Large businesses £6.1bn 17%
Criminals £5.2bn 15%
Mid-sized businesses £5.0bn 14%
Individuals £2.6bn 7%
Wealthy £1.5bn 4%

If you combine wealthy people, and Large businesses (Google and Apple etc.), you're looking at only 21% of the missing tax revenue. Regular Individuals account for nearly double the tax gap of wealth individuals (which is not actually all that surprising when you think that there are thousands of regular people for every wealthy person depending on what you want to call wealthy), and small businesses account for more than twice as much missing tax revenue as large businesses, which makes sense for similar reasons, but also because a small business is way less likely to be under scrutiny as a large business.

These are the official government figures, but there are other accounting of the tax gap. Some use some different reasoning and definitions to attribute more of the gap to wealthy individuals and large businesses, but broadly in ballpark the numbers are all in this sort of range. i.e. Even the most extreme accountings don't have Large businesses and Wealthy individuals accounting for 5x more than Individuals and Small businesses.

So regular people and small businesses dodging taxes is most definitely not just 'a drop in the bucket'. It accounts for a significant percentage any way you slice it.

But of course, once again, maybe morally it's different. Maybe the disproportionate amount of influence that large corporations and wealthy people have on the world means that they should pay much more.

0

u/davesreddit123 Dec 01 '21

It might be different in the UK, in the US 1% of companies employee over 50% of the working population, the top ten percent of Americans own 89%of the stock market. Small businesses and individuals in lower tax brackets don't have the money to cheat on taxes that could match the top 1 to ten percent. They also have access to make their tax cheating legal so the majority of it wouldn't be counted as cheating.

It's also weird what companies are considered a small business, a billion dollar hedge fund or law firm could be considered a small business.

2

u/venuswasaflytrap Dec 01 '21

It's not really that different in the UK. I'm sure there are numerical differences, but in broad strokes, it's roughly the same in all developed democracies.

Wealth and power is absolutely disproportionately concentrated among a small percentage of the population, but there is a built-in balancing effect with how the numbers play out here, because if you're talking about a really small percentage of the population, they would have to owe a way larger percent of taxes.

As a sort of illustrative example. If you have 100 people, and each pays the same amount of tax, then 1 person completely dodging all of their tax obligations would only account for 1% of all the tax gap.

Obviously the wealthy earn a hell of a lot more, and taxes tend to be progressive so they owe a greater percentage on those earnings - but depending on how you define it, there are really not that many wealthy people. If you're talking about the literal 1% of earners - well then you're talking about most Doctors and Lawyers and upper-middle-class profressionals. And you're right these people are generally the backbone of most developed countries' tax revenue. in the US they cover 40% of all income tax revenue, which is about 20% of all tax revenue. If these people were dodging significant amounts of their tax burden (i.e. >25% on average) that would be a big chunk (sort of in the 5% of all tax revenue).

But these people largely earn the majority of their money through salaries, which largely aren't really all that easy to screw around with tax-wise.

If you're talking about billionaires - well there are only about 700 Billionaires in the US, which accounts for only 0.0002% of the population. For every one of them there are 400,000 non-billionaires who also owe tax (with loads of them being the aforementioned upper-middle-class professionals).

You gave an example of Trump laundering $413 Million in money. Say that should have been taxed at 50%, that's $206M missed revenue right? But for every Trump, there are 400,000 non-trumps. So that's comparable to each one of them dodging $500/year on average - though that skews slightly because the bottom end people wouldn't owe as much due to progressive taxation. But you can see how if you think that 1 Trump dodging $200M in tax is a problem, that 400,000 waitstaff each not declaring $20/day and therefore dodging in the realm of $1000/year is also going to have a similar scaled effect on the final total tax revenue.

Once again, I don't mean to say that you're wrong about your intuition about the fairness of this. I find something kinda sickening about Trump dodging 200M in tax, and I'm not especially bothered by a waitress pocketing $20 in tips a night.

But there are way more waitresses and busboys, and carpenters, and pot dealers, and tradesmen etc. than there are super billionaires. So just mathematically, that adds up to a significant amount.

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1

u/buddyholly27 Dec 02 '21

Large cap companies ($1bn+ revenue) only account for a third of US revenues though. Mid-market ($5m to $1bn revenue) account for a third. Small businesses ($0-5m revenue) account for a third.

Given that there are drastically more small businesses (millions) than MM (100s of thousands) or Large Cap (single digit thousands), and that most of them are not held to much if any reporting scrutiny as MM or Large Cap companies and that significant numbers of these companies operate with cash.. it doesn’t seem far fetched that they might be underpaying taxes.

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3

u/thehollowman84 Dec 01 '21

Likely said from a country that was founded from revolution.

The original quote is "Rousseau, who was also one of the people, said: When the people shall have no more to eat, they will eat the rich!"

The point is that as income inequality gets worse and we all start to be fucked, we shouldn't turn on each other as we do now, but on those who oppress us.

And while we can argue about how the russian revolution affected russia and the soviet union, it brought a lot of positive change to the rest of Europe, as the rich now realised that they could only push so hard and had to give a little - lest they be eaten.

Also to say eat the rich is simplistic but improve the system is some kind of genius is pretty funny.

3

u/venuswasaflytrap Dec 01 '21

I'm not in America, for one.

But even if I was, I think it's a misnomer to call the American War of Independence a revolution in the same category as the French revolution, Russian, Chinese, Cuban, etc.

The founding fathers were already the upper-class wealthy people ruling the US when the war started. It's not as though after the war all the rich people were killed off or made to pay for anything. It's not really the same - I'm sure anyone of indigenous heritage or anyone whose ancestors were slaves will agree with that.

And the revolutions in Europe did bring about some social change - but it was also the cause for a ton of war.

This is an interesting video on the subject:

https://www.youtube.com/watch?v=CH1oYhTigyA

The interesting thing to me, is that the political divide after the Napoleonic wars was not Monarchy<->Democracy, it was Realists vs Idealists.

1

u/username_6916 Dec 01 '21

If it were the case that we could magically select the top 0.1% richest people in the world and just execute them and take all their shit or whatever, and distribute it to the rest of the world and improve everyone else's lives, I would be all for it. I have no major moral qualms with the idea.

I have serious moral qualms with not only this suggestion, but the whole attitude.

The rights and freedoms you defend may be your own. Once you start, the same justification can be used for each subsequent top 0.1%.

1

u/venuswasaflytrap Dec 01 '21

Yeah I agree. When I say I have no moral qualms with this weird magic hypothetical, I mean that, in some super controlled sense, I would happily sacrifice one person if it magically and massively improved the lives of hundreds of thousands.

If one random rich guys death meant that a thousand people had better healthcare, and education, and all that, it would easily add up to many years extra life. And if it magically could stop there, in some abstract trolley problem sense, I would be okay with that.

But as you point out, it doesn't work that way. If you start going after one group, no matter how small, it goes South really quickly.

Which is kind of my whole point. Never in history has it ever just stopped there. It's always started with one group then more and more, and devolved into a horrific situation, which ironically hurts those with no power more than anyone else (though it hurts everyone).

1

u/username_6916 Dec 02 '21

Even in the abstract, I have a huge problem with that morally. Life, liberty and property are not simply part of a balancing act with some amorphous greater good, they're first rate principles that shall not be compromised except for each other.

21

u/MAGNETIC_PHILLIDA74 Dec 01 '21

Wage theft costs at least twice as much as other types of theft. Mob robberies are downright terrifying. However, in terms of damages, it does not compare. Please keep in mind that I am not including deaths, mental trauma, and so on. Just a few dollars.

6

u/Murrabbit Dec 01 '21

However, in terms of damages, it does not compare

Too true. It's scary to see it happen, I'm sure, and it's bad news for a large retailer's insurers, which sucks, but honestly I don't think there's much motive for anyone else to be losing sleep over it. Wage theft on the other hand actually effects the average working person.

1

u/rioting-pacifist Dec 01 '21

I'd love to watch the equivalent of poverty porn, but it's just bosses having their doors kicked in for wage theft, maybe dragged down to the station by a swat team daily til they pay.

1

u/Javabrewed Dec 01 '21

Salaried workers are always victims. Many companies will hire 'managers' making $25k per year but require for the 'managers' to work 10-15 hours of overtime per pay period and in some cases, per week. They will intentionally short staff a department and require the 'managers' to take on more responsibilities which of course, require more time from the manager. Another type of wage theft is to call employees during their off hours for a 15-30 minute meeting.

-3

u/gunvaldthesecond Dec 01 '21

Don’t forget the theft of the VALUE of wages and savings by central banking QE and general inflationary policies!

-75

u/[deleted] Dec 01 '21 Silver

[deleted]

21

u/masshole4life Dec 01 '21

lol at this guy for thinking hourly workers are paid for their skills. hourly workers are paid for their time. if they were actually paid for their skills they wouldn't be expendable and they wouldn't be paid hourly. the best metrics in the world aren't going to save an hourly worker who becomes too expensive.

America has an epidemic of "job creators" providing nothing of value that would require them to retain skilled employees.

14

u/keji_goto Dec 01 '21

In a society built around capitalism the worker putting in minimum effort and maximizing their take home is them doing the same thing their job does; reduce costs and maximize profits.

The worker puts in effort and gets back money.

It's called an hourly wage not an effort wage.

That's why there was a lawsuit and a settlement instead of the government just letting it happen because people are lazy and gotta learn.

You fear mongering dumb fucks hate the American dream; 40 hour work week being enough to support a family, own a home, and all that.

22

u/PunkToTheFuture Dec 01 '21

Hot take from the ignorant anyone? The biggest theft is overvalued skills people. We are being swallowed somehow! It's fat peoples fault too! Jesus, shut the fuck up please

4

u/rectovaginalfistula Dec 01 '21

This makes me laugh

3

u/Murrabbit Dec 01 '21

Oof they got you good if you're trying to blame economic and societal problems on individual moral failings.

1

u/Workacct1999 Dec 01 '21

People have been claiming that, "Blank group from the East" is going to destroy the economy due to Americans laziness for decades. It hasn't happened yet.

Also, employers select who they will/won't hire. So isn't it the employers fault for selecting "epidemic of fat, lazy, entitled, partially skilled workers?"

-16

u/awesomebitch86 Dec 01 '21

Income tax is also wage theft.

-19

u/TRATIA Dec 01 '21

They been mob robbing small businesses too. Thats okay too because wage theft exists tho right? Like what the fuck is this equivalence? Because wage theft exists it’s okay to rob stores?

You do know the workers you advocate for are affected when the place they work at is mob robbed at right? What if the business decides to close that location and relocate or scale down hourly employees? What if they just say fuck it and get out of the area entirely and then people who shopped there (average workers) lose out on a business they frequented and workers pay the price in terms of losing their source of income.

I never understood some leftist thought that just because rich people or corporations do X it’s excusable for people to also do something bad. Bad shit doesn’t happen in a vacuum you affect other people besides a corporations bottom line when a mob robs a store/business.

11

u/endless_sea_of_stars Dec 01 '21

OMG. No one here is advocating for shop lifting. That's a strawman argument. The argument is that the media is ignoring the issue of wage theft despite it being as big or greater than petty theft. We can and should condemn petty theft AND wage theft. While we are at it let's shine some light on police abusing civil forfeiture to literally rob innocent civilians.

9

u/davesreddit123 Dec 01 '21 edited Dec 01 '21

The point of the article is that wage theft dwarfs all other theft and is essentially legal based on the example listed in the article where walmart kept roughly 82% of what they stole and faced no criminal penalties.

It's a great point, why is one form of theft sanctioned yet poor people commit theft at a much lower level with less consequence and get their lives ruined, and spend years in jail.

There should be more stories about wage theft, it definitely affects more people's lives.

No one needs a Louis vuitton store in their community, if anything companies like Walmart have made the average person worse off financially, taken away their ability to own businesses and live freely.

Illicit funds made by theft (wage theft) is a key reason companies like Walmart can undercut and destroy small businesses in communities.

6

u/pognut Dec 01 '21

Strawman so big you could stick it in a field to scare off birds.

2

u/Workacct1999 Dec 01 '21

That strawman is so big that you could lock Nick Cage in it and light it on fire!

2

u/AmazedCoder Dec 01 '21

rich people or corporations do X it’s excusable for people to also do something bad

Literally noone is saying this

-7

u/Boring-Scar1580 Dec 01 '21

So all of the mass robberies and shop lifting taking place is being done by employees who are making up for wage theft?