This month, Attorney General Keith Ellison filed a complaint alleging that over the last three years, dairy producers Keith Schaefer and his daughter Megan Hill stole almost $3 million from hundreds of their employees in central Minnesota. The owners of Morgan Feedlots and Evergreen Acres Dairy, Schaefer and Hill, allegedly took 12–32 hours out of workers’ paychecks every two weeks, didn’t pay them for the first and last weeks they worked, and took rent money from their wages for beds in unfit buildings. Although workers put in 12-hour days six to seven days a week, they were only paid $12 to $17 per hour with overtime payments.
When the lawsuit was served on Schaefer and Hill at their residence in Stearns County, they were not arrested, despite the fact that stealing anything worth at more than $1,000 is a crime in Minnesota. Despite the complaint detailing Schaefer’s violent assaults and threats to murder employees, they have not been charged with any crimes. Case in point: Minnesota’s new wage theft legislation, which aims to discourage what worker advocates describe as an all-too-common behavior, but which has both potential and obstacles, as this case shows.
The state of Minnesota has enacted a criminal statute that is among the most stringent in the nation against wage theft as of 2019. Wage theft over $35,000 carries a maximum penalty of twenty years in jail and a fine of $100,000. But the rule of law is almost never put into practice. Prosecutors have only filed five cases involving pay fraud in the previous four years. There has been a single gross misdemeanor conviction for wage theft, but it seems like it was an oversight in the filing process since the individual in question was also charged with stealing electronics from Walmart.
Arresting an individual for the theft of wages is more difficult than putting them behind bars for the theft of a vehicle or money. As a prosecutor, you must establish that the employer acted with the “intent to defraud.” It is insufficient to simply demonstrate that the business failed to pay workers their fair wages. Local law enforcement has little expertise in financial crimes and an absence of investigative resources, making them ill-equipped to handle instances of pay theft.
