Texas workers have long struggled with wage theft by their employers—and the state’s willingness and ability to crack down on scofflaw employers has been relatively minimal. Now, rates of suspected wage theft are increasing, and the state labor law enforcement system is straining to keep up.
Last year, state investigators faced the highest number of paycheck complaints in nine years and a prior internal audit noted that it typically took months just for complaints to be assigned to an investigator.
“The current system is failing workers in that it’s too slow, especially with many Texans living paycheck to paycheck,” said Sean Goldhammer, director of employment and legal services at the Workers Defense Project, a statewide member-led group that advocates for immigrant workers.
It’s already hard enough for working-class Texans to survive with their full paychecks; 42 percent of Texas households face financial instability. The state still follows the federal minimum wage, which has remained at $7.25 an hour since 2009, and housing in the state has become less affordable.
Meanwhile, the rate of wage theft complaints has soared in recent years, and the state agency responsible for policing labor laws has been unable to keep up. In the 2024 fiscal year, more than 15,000 complaints were filed with the Texas Workforce Commission (TWC), which is charged with enforcing state and federal labor law. That’s the highest amount since at least 2016 and double the amount from 2021, according to agency reports. Of the 12,400 cases investigated that year, the state ordered employers to pay back more than $10 million in wages.
Wage theft comes in the form of anything from missing paychecks, commissions, bonuses, or other owed wages under the state payday law to overtime manipulation and misclassification as an independent contractor. TWC may not investigate every complaint if it’s submitted past the 6-month deadline, without sufficient evidence, or involves a bankrupt employer.
As the number of cases grew, so has the backlog of unresolved complaints, according to an internal TWC audit that the Texas Observer obtained through a public records request. Once investigators are assigned a case, the department goal in 2023 was to finish in 21 days—they achieved a 10-day average. Although they were fast at processing claims, the increasing number of cases started piling up and it took longer for them to even be assigned to investigators. This caused them to fall short of their second internal goal, which is to have a case complete within 90 days after the case is first submitted—their 2023 average was 103 days.
“It’s difficult to do this work day in and day out, especially when you have way too much work on your plate,” said Jenn Round, a Rutgers University researcher at the Workplace Justice Lab, who helps states with their labor law enforcement efforts and formerly led the Seattle Office of Labor Standards.
Despite the challenges faced by state investigators, TWC has recovered millions of dollars for workers over the years. Records show that they collected $7.5 million in the 2024 fiscal year, the highest amount since at least 2016. “To have the capacity and the resources to do impactful investigations, you have to have the people power,” Round said.
The TWC signaled a need for more support last year when they requested an extra $1.2 million for its biennial budget for salary increases to help retain its labor law enforcement staff, citing the growing rate of complaints. TWC had a turnover rate of 14 percent in 2024, the fifth highest of all state agencies that year, according to a state auditor’s report. The agency has also seen a drop in qualified candidates for investigator positions, among others, according to its latest strategic plan.
After the TWC’s three governor-appointed commissioners ranked the request 9th out of 10 on the agency’s priority list, the requested salary funds were ultimately declined by Texas House and Senate appropriators earlier this year. (In 2023, legislators did approve $2.2 million to fund the modernization of the department’s outdated case management system, but implementation is facing delays.)
The operating budget for the agency’s labor law enforcement activities is set at $4.5 million for the 2026 fiscal year, compared to $3.7 million in 2023. A TWC spokesperson told the Observer they did not have anyone available for an interview, and the agency did not not respond to requests for comment.
The TWC could soon undergo major changes given that the agency is under review by the Texas Sunset Advisory Commission, which typically happens every 12 years with lawmakers deciding if an agency should be reformed or abolished. Public input is now being sought since the agency released its self-evaluation report in August.
For Goldhammer, who has helped workers file complaints, he’d like to see the state fund more investigators to process complaints, an increase in the current 180-day statute of limitations (federal labor law investigations have a two-year statute of limitations), and the creation of an industry funded wage-theft pool that could be used to immediately pay out claims that are in favor of an employee.
Stronger collection capabilities are also needed, advocates say.
Research by Round and her colleagues found that TWC ordered $99 million in wages ordered due across over 57,000 cases between 2010 and 2020, but 80 percent of those wages had yet to be recovered as of 2024. The TWC told the Dallas Morning News in 2023 that it could not verify Rutgers’ findings since it lacked access to the methodology.
“Collections is a difficult problem. It’s like collecting against any debt. If the money’s not there, the money’s not there,” Round said. TWC’s current enforcement and deterrent tools vary. Penalties of up to $1,000 can be imposed on bad-faith employers, the agency can order the employer’s bank to freeze funds and turn them over, or it can file a lawsuit against the employer. A lien is also attached to an employer’s property after a final determination of owed wages, which could force employers to pay back owed wages if they try to sell the property. There are currently more than 11,000 active liens totaling over $127 million, according to state data.
Other enforcement mechanisms used elsewhere around the country include revoking the food permits from employers that don’t comply with wage orders or stop-work orders that force an employer to close operations if they don’t pay owed wages, Round noted. A few cities—Austin, El Paso, and Houston—have enacted ordinances meant to fight wage theft, but they lacked effective enforcement powers.
Collecting wages is also a problem faced by labor attorneys, such as Joe Buenker, who represents Houston-area workers in federal labor lawsuits. In one case, he said, it took him five years to collect the money off of a lien he had placed on an employer’s property. “If I had collected all the judgments in my career, I’d have my own island,” Buenker told the Observer.
“We’re not getting what we should get out of that business relationship…The person that’s doing it right—paying their worker as an employee, withholding taxes, and having all their people covered by workers’ comp—it’s more expensive to do business the right way, but it benefits society as a whole,” Buenker said.
In parallel to these varying state labor law enforcement systems and the courts, there is also the Wage and Hour Division within the U.S. Department of Labor (DOL), which investigates violations of various federal laws, including those that cover minimum wage and overtime. A recent case involved workers in Travis County who alleged that their wages were stolen while working for contractors building the Tesla Gigafactory.
The number of investigators, however, is dwindling. As of earlier this year, there were just 611 the lowest point in decades nationwide, according to Rutgers University researchers. As of May 2025, there were only 68 federal investigators assigned in Texas—one for every 232,000 workers. A review of federal data shows that the total wages federal investigators ordered to be paid back in Texas is the lowest it’s been in 21 years at $7.5 million in the 2025 fiscal year, compared to tens of millions in prior years.
“No law can enforce itself. You have to have people to enforce it,” Jeff Darby, a former DOL wage investigator in Texas for 33 years until 2023, told the Observer. “And if you don’t, the whole thing is a fraud.”
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