Texas cannot sustain with surge in employees’ wage theft complaints

This text was initially revealed by the Texas Observer, a nonprofit investigative information outlet and journal. Join their weekly publication, or observe them on Fb, X, and Bluesky.

Texas employees have lengthy struggled with wage theft by their employers — and the state’s willingness and skill to crack down on scofflaw employers has been comparatively minimal. Now, charges of suspected wage theft are rising, and the state labor regulation enforcement system is straining to maintain up.

Final yr, state investigators confronted the very best variety of paycheck complaints in 9 years and a previous inside audit famous that it sometimes took months only for complaints to be assigned to an investigator.

“The present system is failing employees in that it’s too sluggish, particularly with many Texans dwelling paycheck to paycheck,” stated Sean Goldhammer, director of employment and authorized providers on the Staff Protection Challenge, a statewide member-led group that advocates for immigrant employees.

It’s already arduous sufficient for working-class Texans to outlive with their full paychecks; 42 % of Texas households face monetary instability. The state nonetheless follows the federal minimal wage, which has remained at $7.25 an hour since 2009, and housing within the state has change into much less reasonably priced. 

In the meantime, the speed of wage theft complaints has soared in recent times, and the state company liable for policing labor legal guidelines has been unable to maintain up. Within the 2024 fiscal yr, greater than 15,000 complaints had been filed with the Texas Workforce Fee (TWC), which is charged with implementing state and federal labor regulation. That’s the very best quantity since not less than 2016 and double the quantity from 2021, in keeping with company stories. Of the 12,400 circumstances investigated that yr, the state ordered employers to pay again greater than $10 million in wages.

Wage theft comes within the type of something from lacking paychecks, commissions, bonuses, or different owed wages below the state payday regulation to time beyond regulation manipulation and misclassification as an impartial contractor. TWC might not examine each grievance if it’s submitted previous the 6-month deadline, with out adequate proof, or entails a bankrupt employer. 

Because the variety of circumstances grew, so has the backlog of unresolved complaints, in keeping with an inside TWC audit that the Texas Observer obtained by a public information request. As soon as investigators are assigned a case, the division objective in 2023 was to complete in 21 days—they achieved a 10-day common. Though they had been quick at processing claims, the rising variety of circumstances began piling up and it took longer for them to even be assigned to investigators. This triggered them to fall in need of their second inside objective, which is to have a case full inside 90 days after the case is first submitted — their 2023 common was 103 days. 

“It’s tough to do that work day in and day trip, particularly when you could have manner an excessive amount of work in your plate,” stated Jenn Spherical, a Rutgers College researcher on the Office Justice Lab, who helps states with their labor regulation enforcement efforts and previously led the Seattle Workplace of Labor Requirements.

Regardless of the challenges confronted by state investigators, TWC has recovered thousands and thousands of {dollars} for employees through the years. Information present that they collected $7.5 million within the 2024 fiscal yr, the very best quantity since not less than 2016. “To have the capability and the assets to do impactful investigations, you must have the folks energy,” Spherical stated.

The TWC signaled a necessity for extra help final yr after they requested an additional $1.2 million for its biennial finances for wage will increase to assist retain its labor regulation enforcement employees, citing the rising price of complaints. TWC had a turnover price of 14 % in 2024, the fifth highest of all state businesses that yr, in keeping with a state auditor’s report. The company has additionally seen a drop in certified candidates for investigator positions, amongst others, in keeping with its newest strategic plan.

After the TWC’s three governor-appointed commissioners ranked the request ninth out of 10 on the company’s precedence checklist, the requested wage funds had been finally declined by Texas Home and Senate appropriators earlier this yr. (In 2023, legislators did approve $2.2 million to fund the modernization of the division’s outdated case administration system, however implementation is going through delays.) 

The working finances for the company’s labor regulation enforcement actions is ready at $4.5 million for the 2026 fiscal yr, in comparison with $3.7 million in 2023. A TWC spokesperson informed the Observer they didn’t have anybody out there for an interview, and the company didn’t not reply to requests for remark.

The TWC might quickly bear main adjustments provided that the company is below evaluation by the Texas Sundown Advisory Fee, which usually occurs each 12 years with lawmakers deciding if an company must be reformed or abolished. Public enter is now being sought for the reason that company launched its self-evaluation report in August.

For Goldhammer, who has helped employees file complaints, he’d prefer to see the state fund extra investigators to course of complaints, a rise within the present 180-day statute of limitations (federal labor regulation investigations have a two-year statute of limitations), and the creation of an trade funded wage-theft pool that might be used to instantly pay out claims which are in favor of an worker.

Stronger assortment capabilities are additionally wanted, advocates say. 

Analysis by Spherical and her colleagues discovered that TWC ordered $99 million in wages ordered due throughout over 57,000 circumstances between 2010 and 2020, however 80 % of these wages had but to be recovered as of 2024. The TWC informed the Dallas Morning Information in 2023 that it couldn’t confirm Rutgers’ findings because it lacked entry to the methodology.

“Collections is a tough downside. It’s like accumulating towards any debt. If the cash’s not there, the cash’s not there,” Spherical stated. TWC’s present enforcement and deterrent instruments fluctuate. Penalties of as much as $1,000 could be imposed on bad-faith employers, the company can order the employer’s financial institution to freeze funds and switch them over, or it could actually file a lawsuit towards the employer. A lien can be connected to an employer’s property after a closing dedication of owed wages, which might power employers to pay again owed wages in the event that they attempt to promote the property. There are at the moment greater than 11,000 lively liens totaling over $127 million, in keeping with state information.

Different enforcement mechanisms used elsewhere across the nation embody revoking the meals permits from employers that don’t adjust to wage orders or stop-work orders that power an employer to shut operations in the event that they don’t pay owed wages, Spherical famous. A number of cities — Austin, El Paso, and Houston — have enacted ordinances meant to combat wage theft, however they lacked efficient enforcement powers.

Accumulating wages can be an issue confronted by labor attorneys, reminiscent of Joe Buenker, who represents Houston-area employees in federal labor lawsuits. In a single case, he stated, it took him 5 years to gather the cash off of a lien on an employer’s property. “If I had collected all of the judgments in my profession, I’d have my very own island,” Buenker informed the Observer.

“We’re not getting what we must always get out of that enterprise relationship. … The person who’s doing it proper — paying their employee as an worker, withholding taxes, and having all their folks lined by employees’ comp — it’s costlier to do enterprise the suitable manner, however it advantages society as an entire,” Buenker stated.

In parallel to those various state labor regulation enforcement methods and the courts, there may be additionally the Wage and Hour Division throughout the U.S. Division of Labor (DOL), which investigates violations of varied federal legal guidelines, together with those who cowl minimal wage and time beyond regulation. A current case concerned employees in Travis County who alleged that their wages had been stolen whereas working for contractors constructing the Tesla Gigafactory.

The variety of investigators, nevertheless, is dwindling. As of earlier this yr, there have been simply 611, the bottom level in a long time nationwide, in keeping with Rutgers College researchers. As of Could 2025, there have been solely 68 federal investigators assigned in Texas—one for each 232,000 employees. A evaluation of federal information reveals that the entire wages federal investigators ordered to be paid again in Texas is the bottom it’s been in 21 years at $7.5 million within the 2025 fiscal yr, in comparison with tens of thousands and thousands in prior years.

“No regulation can implement itself. It’s important to have folks to implement it,” Jeff Darby, a former DOL wage investigator in Texas for 33 years till 2023, informed the Observer. “And for those who don’t, the entire thing is a fraud.”

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