Retaliation Funds: A New Tool to Tackle Wage Theft

Wage theft is rampant in our economy.[1] Despite countless local, state, and federal laws recognizing workers’ hard-won minimum wage and overtime rights, the legal system enables employers to steal billions of dollars each year from mostly Black, brown, indigenous, and immigrant workers. The system depends on workers coming forward to report wage theft, but fear of retaliation silences countless workers.

Even our strongest retaliation protection laws have not overcome the fact that when a worker speaks up, that worker takes on an enormous and immediate risk. If their employer retaliates by cutting their pay or firing them, for example, even the best laws will normally take months, if not years, to hold the employer accountable and provide a remedy. And that is assuming that workers can even collect from their employers, who may have hidden assets or disappeared. By then, a worker may have faced eviction, gone further into debt, incurred steep fees for late payments, damaged their credit, and more. Workers facing wage theft are stuck between two impossible choices: laboring under illegal workplace conditions or speaking out and risking, among other things, their already precarious and insufficient economic security.

This paper proposes a practical new tool to make it easier for workers to report wage theft: a retaliation fund that would allow workers to quickly access meaningful financial support when they have reported wage theft and subsequently lost their job or faced a pay cut due to retaliation. By offering some relief from retaliation when workers need it most, this fund would help fill the urgent gap in the current enforcement landscape that forces workers to remain silent or risk everything by speaking up.

Below, we outline how a retaliation fund could operate in practical terms. NELP can offer technical support to any worker organizations and labor enforcement agencies interested in establishing a pilot program or otherwise exploring the potential of a retaliation fund.

A retaliation fund enables workers to quickly access meaningful financial support if they lose their job or otherwise face retaliation for reporting wage theft.

Our ability to raise our voices as workers without fear is a human right vital to building power on the job and a practical necessity in fighting back against wage theft. While workers have found ways to organize and bear the risk of retaliation together—by forming unions, establishing mutual aid funds, and pushing for better conditions through legislative campaigns, for example—our approach to enforcement must itself ensure that each and every worker can exercise their rights. As workers, particularly Black, brown, indigenous, and immigrant workers, continue to fight for a country that fully recognizes and centers their needs, rights, and priorities, a retaliation fund offers an enforcement tool that directly responds to workers’ reality.

Download the brief to read more. 

Endnotes

[1] Wage theft generally refers to the practice of depriving workers of the minimum wage, overtime, tips, and other pay protections. See, e.g., Wagetheft.org, Frequently Asked Questions, https://www.wagetheft.org/faq (last viewed April 2, 2021).