Employer tips for avoiding wage theft

minnesota department of labor and industry

Wage and Hour Bulletin

Feb. 13, 2018

Preventing wage theft in Minnesota

It is estimated 39,000 Minnesota workers are not paid what is owed to them in earned wages, overtime and benefits annually. When an employer avoids paying or fails to pay wages earned by its employees, it is wage theft.  

Most Minnesota employers correctly pay their employees for the work they perform, however, there are a few who don’t. Besides hurting their employees, employers who commit wage theft have an unfair cost advantage over their competitors who follow the law. 

The Minnesota Department of Labor and Industry is committed to helping employers understand state labor standards to ensure employers comply with the law and do not commit wage theft.

 Ten tips to help employers avoid committing wage theft

  1. Pay your employees at least the state minimum wage. New rates became effective Jan. 1, 2018 (see current requirements at www.dli.mn.gov/LS/MinWage.asp).  Employers operating in the city of Minneapolis need to be aware of the Minneapolis Minimum Wage Ordinance (see http://minimumwage.minneapolismn.gov).
  2. Pay your employees for all hours worked. Employees must be paid for employer-required training and for time needed to prepare to perform work, such as restocking supplies and performing safety checks. If you require employees to meet at a centralized location before driving to a worksite, pay the employee for the drive-time from the location to the worksite. Employers cannot require employees to remain at work and "punch in" only when it gets busy, "punching out" when business gets slow.
  3. Pay your hourly employees for overtime when their work hours exceed 48 hours in a work week. Federal law requires some hourly employees to receive overtime after working 40 hours in a work week. Some employees are exempt from this requirement. More information about federal and state overtime requirements is online at www.dli.mn.gov/LS/Overtime.asp.
  4. Pay your employees at least every 31 days.
  5. Do not misclassify employees as independent contractors. Such misclassification not only adversely impacts the employees, it also creates a competitive disadvantage for employers that comply with state laws related to workers' compensation, unemployment insurance and tax withholding.
  6. Do not take unlawful deductions from your employees' paychecks. Deductions for lost or damaged property, cash shortages, tools or uniform expenses generally cannot be made.
  7. Do not require your employees to pool or share tips.
  8. If you have a question, call us. We are available by phone at (651) 284-5070, Monday through Friday, 7:30 a.m. to 6 p.m.
  9. Get more information online. Visit www.dli.mn.gov/LaborLaw.asp for information about all Minnesota labor standards laws.
  10. Share these tips. Encourage other employers and associations to subscribe to our Wage and Hour Bulletin at www.dli.mn.gov/LS/Bulletin.asp


    Labor Standards serves the citizens of Minnesota by providing 
    information about the state's wage, hour and employment laws.

     Phone:  (651) 284-5070 or 1-800-342-5354
    Email:  dli.laborstandards@state.mn.us 
    Web:  www.dli.mn.gov/LaborLaw.asp