Employees cheated by their employers lost $60 million in wages from 2010 to 2014 and another $12 million could be lost this year, thanks to the Department of Labor’s nearly nonexistent attempts to locate the workers.
When the government’s lone attempt to find an employee it owed money — through a mailed letter — failed, the Labor Department’s Wage and Hour Division quit trying, according to the agency’s inspector general.
“Employees owed these monies may never receive their back wages because [the division] did not spend sufficient time or efforts to locate them,” the report said.
Back wages are owed when an employee doesn’t receive their full pay from an employer. If an employer refuses to comply, the Labor Department can intervene, collect the money owned and get it to the worker.
But $60 million in unpaid back wages were instead sent to the Treasury after Labor Department officials “made minimal efforts to locate” employees, many of whom are minimum wage earners. The inspector general estimates that another $12 million will be similarly handled without changes in the process.
In the sample cases reviewed, investigators found the Labor Department was unable to locate three-quarters of employees who were owed $1.4 million collectively. Another $1.4 million from the sampled cases most likely won’t be recovered for employees because officials didn’t refer employers for collection.
In one case, after nearly a year of trying to force an employer to pay $1.2 million in back wages, the government “reduced the balance the employer owed to zero without providing an explanation for why it took this action,” the inspector general said.
Investigators also found that officials lacked documentation that 225 employees were paid $2.5 million in back wages.
Labor Department officials assessed $1.1 billion in back wages from 2009 to 2013. Employers paid three-quarters of that to employees, leaving the government to collect and pay the remaining $264 million.
