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Engineers settle with tech companies over wage theft

A group of more than 64,000 software engineers have reached an agreement with some of the country’s largest tech companies over an alleged $3 billion in wage theft over the course of four years. The engineers worked with the Department of Labor to obtain the settlement after it became clear that the software companies were working together to keep pay at a low, stable rate. Specifically, the companies colluded not to compete for employees. This had the result of eliminating competition for top talent, which prevented the normal salary increases that come along with changing one’s job. 

This case brings to light the fact that wage theft and other types of labor law violations can happen in a variety of contexts and that it may not always be recognizable at first. This case seems at first glance to be mostly about anti-trust issues, since it involves would-be competitors conspiring to manipulate the market. However, a closer look reveals that in fact this action was directed at suppressing wages and in fact artificially maintained low pay for software engineers, which in this case was deemed to be a form of wage theft.

Wage theft is most often recognized as a problem for low wage and hourly workers, who may be forced to work unpaid overtime, or paid under minimum wage or they may have their tips stolen. This type of wage theft is estimated to cost workers nearly $208 million in 2012.

All of these examples show how important it is to be vigilant about your rights at work and how employment law violations can impact anyone.

Source: The New York Times, "Wage Theft Across the Board," The Editorial Board, April 21, 2014

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