Backgrounder

Wage Theft Prevention and Wage Theft Recovery Backgrounder

Bill name: Wage Theft Prevention and Wage Theft Recovery Act, H.R. 7701
Sponsored by Rep. Rosa DeLauro (D-CT)
S. 4174, sponsored by Sen. Patty Murray (D-WA)

Summary:  The Wage Theft Prevention and Wage Recovery Act was introduced in May 2022 by Congressional Democrats.  According to a statement from the bill sponsors, the bill will “help combat wage theft and improve wage recovery by:

  • Strengthening workers’ right to fair pay and improving employer accountability
  • Increasing deterrence of and penalties for wage theft violations
  • Bolstering recovery of workers’ stolen wages
  • Expanding workers’ rights to their employment records”

However, in a letter sent to Congress, seven organizations, including I4AW, raised policy concerns. They wrote,

“Unfortunately, even if H.R. 7701 is well intended, this legislation applies heavy-handed stipulations, stifling costs, is an unwarranted expansion of DOL powers, and grants government policing powers to special interest groups like unions. It would do more to undermine American workers and businesses than it could ever do to address legitimate instances of improper wages and payments.”

Background: The House of Representatives Committee on Education and Labor held a hearing on the legislation on May 11, 2022.

Rep. Fred Keller (R-PA), ranking member of the Workforce Protections Subcommittee, voiced concerns about the legislation. Keller said DeLauro’s legislation would “weaponize” the Fair Labor Standards Act through “onerous mandates and disproportionate penalties” and “alter the FLSA by expanding its jurisdiction to all employer-employee contracts, including collective bargaining agreements.”

Witness Tammy McCutchen, a former administrator of DOL’s Wage and Hour Division, criticized the new legislation on a number of fronts. She said it would impose new provisions on employers that have never been regulated under FLSA but rather are left to the states, propose increased penalties that are “very significant, even ridiculous”, and provide no discretion or flexibility in penalties based on the size of the business or type of violation.

Bill Status:  The Committee on Education and Labor marked up the legislation on May 18, 2022.

Additional Resources

COALITION LETTER: I4AW Sends Letter to House Committee on Education and Labor Committee Raising Concerns with Punitive Penalties for Job Creators and Chilling Effects on Independent Workers
May 18, 2022, I4AW.org

FACT SHEET: Wage Theft Prevention and Wage Recovery Act
House Committee on Education and Labor
Prepared by bill sponsors
Section by section: https://edlabor.house.gov/download/wage-theft-prevention-and-wage-recovery-act-of-2022-section-by-section

HEARING (Zoom Video): Standing Up for Workers: Preventing Wage Theft and Recovering Stolen Wages
May 10, 2022, Education and Labor Committee

OPENING STATEMENT: Rep. Fred Keller (R-PA), Republican Leader Subcommittee on Workforce Protections Hearing
May 11, 2022, Education and Labor Committee

U.S. CHAMBER LETTER: on H.R. 7701, the “Wage Theft Prevention and Wage Recovery Act”
May 18, 2022, U.S. Chamber of Commerce

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