5 Most Common Forms of Wage Theft in California

Every year, thousands of workers across California lose hard-earned income to wage theft, yet many cases go unreported. 

In fact, researchers estimate that more than 12,600 fast food workers in Greater Los Angeles are victims of wage theft each year, most never filing a complaint. This silent crisis affects low-wage earners and salaried employees who are denied overtime, breaks, or accurate pay. 

The good news is that California offers strong protections for workers—let’s explore how you can use them to your advantage.

What Is Wage Theft?

Wage theft occurs when an employer unlawfully withholds wages or benefits owed to an employee. It can affect hourly employees, salaried staff, or independent contractors. Under wage and hour laws, California workers are entitled to proper pay for every hour, including overtime pay, meal and rest breaks, and accurate pay stubs.

Common wage theft examples include:

• Not paying overtime or minimum wage
• Failing to issue a final paycheck after termination
• Misclassifying employees as independent contractors
• Taking illegal deductions from paychecks

The 5 Most Common Forms of Wage Theft in California

1. Unpaid Overtime

Many California workers don’t realize that under overtime laws, they must be paid 1.5 times their regular rate after 8 hours per day or 40 hours per week. Employers who miscalculate or omit overtime commit wage theft.

Tip: To verify accuracy, keep detailed time records and compare them to your pay statements.

2. Below Minimum Wage

Paying employees less than the state-mandated minimum wage violates California Law. The state adjusts its rates annually, and local ordinances may require even higher wages.

Current and Previous Minimum Wage Rates (2024–2025)

(Source: California Department of Industrial Relations)

3. Misclassification of Employees

Some employers label workers as “independent contractors” to avoid paying benefits or taxes. This misclassification often leads to missing overtime, sick leave, and unemployment coverage—another form of wage theft case.

If you suspect misclassification, consult wage claim attorneys or a labor law lawyer in California to review your employment status.

4. Illegal Deductions

Employers cannot deduct wages for tools, uniforms, or damaged equipment unless authorized by the employee. Such deductions can result in wage violations, which violate wage and hour laws that protect workers’ net pay.

Examples of Illegal Deductions:

• Cash shortages not proven to be the employee’s fault
• Uniform or equipment costs
• Customer walkouts

5. Full Wage Theft – Unpaid Salary

The most blatant form of wage theft is when an employer fails to pay wages. Unpaid wages are illegal due to bankruptcy, retaliation, or bad faith. Workers are entitled to full compensation for time worked, including accrued benefits and wage statement documentation.

Filing a wage claim through the DIR or contacting a labor law lawyer in California can help recover these funds.

What Can You Do If You’re a Victim of Wage Theft?

Here are actionable steps you can take:

1. Document Everything: Keep copies of your pay stubs, schedules, and communication with your employer.
2. File a Complaint: Submit a California wage claim through the Labor Commissioner’s Office.
3. Contact Legal Help: A labor law lawyer in California can guide you through complex wage and hour claim procedures.
4. Stay Informed: Review your rights under California Law to ensure compliance with minimum wage violations and overtime laws.

Why Seek Legal Help

Handling a wage theft case can be stressful, especially when dealing with uncooperative employers. Wage claim attorneys ensure your case is supported by evidence, deadlines are met, and your labor rights are protected. They can also pursue additional damages or penalties if the employer’s actions were intentional.

👉 Explore our related blog post for a clearer picture of the wage claim process from start to finish.

Frequently Asked Questions