How to Prevent and Uncover Wage Theft

Construction industry wage theft is costing California workers, taxpayers and our cities billions of dollars every year. If an employer underpays its workers, pays them off the books, denies workers legally required breaks or overtime wages, or fails to make required payroll tax and insurance contributions, it is called wage theft.

Wage theft is rampant on construction sites—even publicly funded projects. Often these crimes go unreported because workers are afraid to speak out for fear of being fired or otherwise retaliated against.

How to prevent and uncover wage theft on your public projects:

  1. Include in the bid specifications the extra measures you are willing to take to ensure that workers are being paid correctly.
  2. Itemize the bid by scope of work so that you can identify subcontractor bids that are suspiciously low.
  3. On bid day, give extra scrutiny to low bids that look too good to be true. Public entities are required to reject bids that do not include funds sufficient to allow the contractor to comply with all applicable local, state, and federal laws or regulations governing the labor or services to be provided. (Labor Code section 2810)
  4. Have City inspectors do a head count of workers when they are visiting the job site. This will help to determine if workers are not accounted for on certified payroll records.
  5. Inspect the certified payroll records to look for irregularities, such as misclassification of workers, underreporting of hours, underreporting of workforce, non-payment of prevailing wages, non-payment of required training fund contributions, and no apprentice hours.
  6. Have a Spanish speaker visit your job sites to interview workers and inform them of their rights on the job—including the right to rest breaks, overtime, and applicable prevailing wages. Ask the workers to report any violations and to save their pay stubs to protect themselves against wage theft. Let the workers know how to contact your office and the Labor Commissioner if they feel they are being underpaid.