How wage theft victims can apply for millions of dollars held by the government

Federal labor enforcement officials recover millions of dollars each year from employers who break minimum wage or overtime pay laws, but a significant percentage never makes it to workers who are owed.

More than $166 million was unclaimed by nearly 200,000 wage theft victims over the last three years, according to the U.S. Department of Labor. If workers don’t claim that money within three years, it’s sent to the U.S. Treasury.

Many don’t know they are entitled to compensation. More than 15,000 employees with money waiting for them worked for businesses in California, one of the top states with unclaimed wages.

“It’s frustrating and sad all around,” said Yvonne Medrano, an attorney with Bet Tzedek Legal Services, a Los Angeles nonprofit that represents undocumented immigrants in wage theft cases. “It’s workers’ hard-earned money and yet it’s not getting to where it needs to be, which is into the workers’ pockets.”

Why is this happening?

Labor officials acknowledged that the department is more efficient at recovering wages from about nine in 10 employers through investigations than it is in getting the owed wages to the workers whose rights were violated.

Investigations often uncover past abuses in targeted low-wage industries that rely heavily on a transient or immigrant workforce, such as restaurants, agriculture and construction. By the time cases are resolved, people entitled to back pay may have moved on to other jobs or changed home addresses and phone numbers, making it hard to notify them of the resolution.