New Minnesota Law Protects Workers from Wage Theft

By Kathleen Mackey
USW Intern

Minnesota Gov. Tim Walz, a member of the Democratic Farmer-Labor Party, signed into a law last week a measure to protect workers against wage theft in the state by imposing strict penalties.

The law will double the number of state investigators probing wage-theft allegations and subject violators to felony records and prison terms.

The Minnesota Department of Labor and Industry estimates that $12 million is lost yearly as a result of wage theft. Wage theft can occur through wrongful withholdings, failure to pay at least minimum wage or the agreed upon wage rate, and denying payment for mandatory breaks or overtime.

“This is the same thing as if they walked in and took the money from you,” Walz said after the signing. “It’s insidious in that it undermines our faith in the system.”

Employers now face felony charges if they fail to pay their workers the wages to which they are entitled. They will also be required to provide new employees with written notice of employment terms, and the state will allocate about $2 million annually toward enforcement of the state’s wage and hour laws.

Under this law, which will apply to violations occurring on or after Aug. 1, 2019, the penalties will vary based on the value of the theft. For example, if the amount of theft ranges from $1,000-4,999, the penalty could be a maximum imprisonment of five years, or a maximum fine of $10,000. If the theft is $35,000 or higher, the maximum imprisonment could be 20 years – and the maximum fine could be $100,000.

The state of Colorado has also increased penalties under the Human Right to Work With Dignity Act. Signed by Colorado Gov. Jared Polis, the new law deems nonpayment as theft punishable as felony when the stolen amount exceeds $2,000.

Minnesota State Sen. Eric Pratt told the Star Tribune that the agreement on wage-theft protections in Minnesota was a bipartisan effort to put political differences aside and prioritize the needs of working Minnesotans. While he alluded to the possibility of putting more money towards wage-theft investigations in the future, he said he hopes this new law will prevent business owners from stealing wages in the first place.

“We agreed on a core value: If you earn a wage, you should be paid a wage. It’s that simple,” Pratt said. “And if you’re stealing somebody’s wages, if you’re attempting to defraud somebody, you should pay a penalty.”