Wage Theft Enforcement: What Connecticut Employers Need to Know

 Posted on September 28, 2025 in Business Law

Far from just a buzzword, wage theft has become a major enforcement priority in Connecticut. The Department of Labor and state regulators are stepping up audits, investigations, and penalties against employers who fail to comply with wage and hour laws – even when those violations are not intentional. The focus is primarily on misclassifying workers as independent contractors, failing to correctly pay employees overtime, and overlooking mandatory meal breaks, although other issues also exist.

Employers should never view these issues as afterthoughts, as the result could be fines and double damages, not to mention reputational harm that affects employee retention and recruitment. Implementing proactive policies is essential for all Connecticut employers. The best way to achieve this goal is by consulting a skilled Greenwich, CT employment law attorney.

Understanding Wage Theft in Connecticut

Wage theft occurs when an employer denies an employee wages or benefits they are legally owed for work performed. Wage theft affects all workers who are victims, but it disproportionately affects low-wage earners and immigrants. The most common forms of wage theft include:

• Paying workers less than the legal minimum wage.
• Requiring employees to perform work before clocking in or after clocking out with no compensation.
• Not paying workers the required overtime rate, which is typically 1.5 times the regular rate for any hours worked above 40 in one week.
• Keeping employees’ tips, which are earned wages, or "redistributing" employee tips.
• Making unauthorized deductions from an employee’s paycheck.
• Failing to provide required rest and meal breaks or deducting pay for breaks.
• Misclassifying regular employees as independent contractors to avoid paying them benefits and overtime.

More Information About Wage Theft

Billions of dollars are lost each year due to wage theft, which increases families’ reliance on public assistance. Employees who report wage theft may face employer retaliation, including reduced hours or pay, suspension, or even firing. The Fair Labor Standards Act (FLSA) is the federal law that establishes minimum wage and overtime requirements. Connecticut’s current minimum wage is  $16.35 per hour, with a further increase set to take effect on January 1, 2026, to $16.94 per hour. The federal minimum wage remains at $7.25 per hour, unchanged since 2009.

Misclassification of Workers: Employees vs. Independent Contractors

Connecticut law has a presumption that workers are employees unless the employer can prove that a worker meets the criteria for an independent contractor. When an employer exercises significant control over a worker’s daily activities, location, and methods, this is a strong indicator of the employee-employer relationship.

If the services provided by the worker are an integral part of the company’s business operations, the worker is likely an employee. An independent contractor offers services to multiple clients rather than being tied to a single company. Independent contractors typically set their own hours and determine when and how work will be done.

Employers should know that workers who have been misclassified may still be eligible for unemployment benefits. Employers who are unsure whether their workers are misclassified should speak with an employment lawyer to understand their legal obligations to workers. Misclassification of employees is far too common and can result in stiff penalties for employers.

Steps Employers Can Take to Avoid Wage Theft

Employers can conduct regular internal wage and hour audits and train supervisors and HR staff on timekeeping, breaks, and overtime. Accurate and accessible records regarding wages paid and hours worked should be meticulously maintained, and employee classification policies should be regularly reviewed and updated.

Contact a Greenwich, CT Wage Theft Attorney

Wage theft enforcement is becoming more aggressive, and even the smallest oversight can expose your company to liability. The best defense is a proactive strategy of compliance with state and federal laws. An experienced Greenwich employment lawyer from Ivey, Barnum & O'Mara, LLC can identify risks before they become expensive claims. Our attorneys are actively involved in civic and charitable organizations. Many have served in high-profile positions, including seats in the U.S. Congress and Senate. To schedule your free consultation, call 203-661-6000.