Rhode Island AG Pushing Back Against Wage Theft, Labor Violations

Cranston RI

24 February, 2021

4:29 PM

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CRANSTON, RI — Rhode Island's attorney general is fighting back against labor law violations. Peter Neronha voiced his support for proposed legislation that would strengthen penalties for wage theft and misclassification of employees, making them felony violations. "There is an underground economy in Rhode Island where people are misclassified as independent contractors when they are really employees," Neronha said. "That's cheating workers and it's cheating the state's taxpayers." Nerinha will testify in favor of the bill Wednesday night before the Senate Labor Committee. "When employers cheat workers by failing to pay them the wages they are due, it's theft, plain and simple," Neronha continued. "Wage theft not only harms employees, it also deprives Rhode Island of tax revenue, which means taxpayers also pay the price. Both wage theft and misclassification are crimes that warrant felony treatment." Employees are misclassified when their employer treats them as an independent contractor, allowing them to avoid paying for overtime, benefits, Social Security, Medicare, workers' compensation and other taxes. Under the current law, both this and wage theft are misdemeanors. Under the proposed law, the offenses would be upgraded to felonies, with penalties of up to three years in prison and a fine of up to $10,000 for the first offense of misclassification or wage theft of $1,500 to $5,000. Any subsequent misclassification or wage theft higher than $5,000 would result in up to five years in prison and a fine of up to $20,000, or three times the wage amount, whichever is greater. "One simple rule that helps keep our economy running is that workers should receive the pay they deserve from the people who employ them," said Senate Majority Leader Michael McCaffrey, the bill's sponsor. "Wage theft is a very real problem that can be perpetrated in a number of different ways beyond the blatant refusal to pay workers for their work. It can include minimum wage violations, failure to pay overtime and misclassification of workers. This legislation will strengthen the penalties of wage theft to better empower workers." Wage theft and misclassification are common issues in Rhode Island, and Neronha has made it a priority to pursue these cases, his office said. In the last year alone, three current or former business owners were charged with wage theft or misclassification, and several other cases are currently under investigation.