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New bill could help wage-theft victims collect money owed

Numerous workers across the country experience wage theft – whether it is through minimum wage violations, failure to pay overtime, or tipping issues. However, while the Fair Labor Standards Act gives employees an avenue to hold their employers liable for unpaid wages, sometimes achieving an actual payout is difficult.

Even if a wage theft case results in a judgement in the hundreds of thousands, or even the millions, employers have a long history of transferring assets to avoid paying up.

A new bill in the New York Assembly aims to change that. The Securing Wages Earn Against Theft (SWEAT) bill, passed on June 19, creates an “employee’s lien” for workers with wage theft judgments against their employers.

What is an “employee’s lien?”

Some of our readers may have heard of a mechanic’s lien, a legal remedy for home improvement workers to ensure they are paid. The employee’s lien outlined in the SWEAT bill operates similarly. Essentially, the lien freezes an employer’s assets until the debt is paid.

How does the lien work?

The bill allows employees who have proven they are likely to win their wage theft case to attach a lien to their employer’s assets during the pending court action. Allowing the lien while a case is ongoing will hopefully prevent employers from transferring or selling property to avoid their obligation to pay back stolen wages. The employee would still have to wait until after the conclusion of their case before accessing backpay.

New York joins 10 other states, including Maryland and Wisconsin, that have passed legislation to allow all employees the option of placing a lien on an employer’s property.  

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