In late 2013, applause echoed through Houston’s City Council chamber following the unanimous approval of a wage-theft ordinance that would enable the city to investigate, track and penalize city contractors that failed to pay employees overtime, minimum wage or any other compensation owed to them.
Nearly 12 years later, the ordinance has delivered mixed results at best.
Of 55 investigations closed, the city found companies guilty of withholding pay from workers in 35 cases, but was only able to recoup wages in eight instances. The total recovered was just under $5,300.
Twenty-two of those cases involved airport security guards who complained they had to attend unpaid briefings before their shifts started. The city found the contractor had violated the wage theft ordinance, but the company simply refused to pay the back wages.
The city ended up referring those complaints to federal officials, but it took a lawsuit by some of those workers before the contractor agreed to a $100,000 settlement years later.
The city’s wage theft ordinance was intended to supplement state and federal labor law, but its lack of enforcement authority has blunted its effect.
“Actually collecting the money, getting it back to workers is the big issue,” said Laura Boston, organizing director of the Workers’ Defense Project, who advocated for the passage of the city’s wage theft ordinance as director of the Fey y Justicia Worker Center in 2013. “And then, even if a worker is able to recover their wages, they just gave an interest-free loan to the employer. There needs to be a cost.”
The city is not alone in its enforcement limitations.
The Texas Workforce Commission, for example, ordered $98 million to be paid to workers across the state from 2010 to 2020. Workers have yet to receive some $78 million of that.
According to state data, there are 173 employers as of April 2025 with a Houston address that have an active lien against them by the state for failing to pay $1.9 million in earned wages.
Meanwhile, the U.S. Department of Labor’s Wage and Hour Division has taken action on 65 federal enforcement actions in Houston since April 2020, resulting in 1,499 workers receiving $4.9 million in back wages. The Labor Department, however, is facing staff shortages and further downsizing by the Trump administration.
“Those agencies, I think, were not necessarily perceived as a threat to employers,” Boston said. “There needs to be a penalty so that that employer isn’t doing it again. That’s part of that culture of impunity. It’s not enough to just recover the wages.”
Elsa Flores, president of the Texas chapter of the Service Employees International Union, said having extra protections is always welcome. “Even when there is a law, if there’s a way to go around that, that happens.”
Enforcement power
Though the first in Texas, Houston was not the only city that decided to join the wage theft fight. Places as far as Toledo, Ohio, and Minneapolis have enacted similar policies, with El Paso passing one in 2015 and Austin most recently in 2022.
“The cities and counties that have really been able to have an impact on wage theft and the treatment of workers, are the cities and counties that have devoted staff to it, that have resources,” said Terri Gerstein, a long-time labor attorney and director of the NYU Wagner Labor Initiative.
Under Houston’s 2013 ordinance, the Office of the Inspector General is allowed to inspect records and take sworn statements. If a violation is found, but no resolution reached, the OIG, which is part of the city’s Legal Department, will recommend the complaining employee to seek help through the Texas Workforce Commission.
“Essentially they wrote an ordinance that gives them the power to investigate and ask that the employer comply, but they don’t have the power to order compliance or to litigate,” said Jenn Round, a director at the Workplace Justice Lab at Rutgers University who also has experience in leading labor enforcement efforts across the country.
Of the 35 cases where city investigators found a violation, only eight resulted in workers getting their wages back.
The remaining 27 cases were referred to the federal Wage and Hour Division due to noncompliance by the employer or because the company was outside city limits.
The city is not entirely without recourse when it comes to noncompliant employers.
One option is the inclusion of penalties for violations of the wage theft ordinance in the vendor’s contract with the city.
The city did not respond to questions regarding whether the city attorney had taken action against any vendor or contractor due to non-compliance in a wage-theft case.
Public database
Another mechanism aimed at deterring wage theft is the city’s public database of businesses found to have violated state wage and labor laws.
While the database is required to include employers found guilty through the TWC, however, employers in violation of the city’s wage theft ordinance, are not required to appear in the database.
“I had to read this multiple times cause I was like, ‘Wait, how are these things connected?’ It’s almost like they put together different laws in the same law,” Round said.
The city Finance Department publishes the database on its website and notes that the information contained in it is provided by the Texas Workforce Commission and is updated quarterly.
The Finance Department did not respond to questions regarding how it tracks employers found guilty through court adjudications.
Employers who have a criminal conviction regarding wage theft also can lose licenses or permits under Houston’s ordinance. To date, no licenses or permits have been suspended or revoked to date.
The ordinance also prohibits employers or departments from retaliating against an employee who files a wage-theft complaint. According to records reviewed by the Landing, that occurred once in 2017, when a janitorial company fired an employee shortly after the worker had filed a wage theft complaint.
“If you want to make a difference, like there’s a whole menu of things you can do,” Gerstein said. “Setting up a workers’ board, education and outreach, and giving grants to worker rights organizations.”
Round said local governments also could be more proactive about enforcing wages law rather than letting complaints drive enforcement. In Seattle, for example, the city’s Office of Labor Standards has had many six-figure settlements with employers accused of wage-theft.
The original wage theft ordinance proposed for Houston was broader in scope and included stronger enforcement mechanisms. The ordinance approved by City Council, however, was much narrower following negotiations between labor groups and local business interests.
“The enforcement method got watered down more, but at the time we felt like we wanted to get something in and we got as much as we could get at that time,” Flores said.
The original proposal, for example, would have allowed the city to investigate wage theft claims involving employers that are not city contractors. The proposal also called for a watch list that would include every employer named in a complaint, regardless of whether it was found to have violated the ordinance. That list would have been for the city’s internal use only, rather than publicly available.
Moving forward, Gerstein suggests that cities hire one person to focus on worker rights issues. “Especially because workers’ rights haven’t historically been a focus of municipal government. This is a new thing,” Gerstein said.
The original proposal required Houston to assign a wage-theft coordinator who would oversee complaints, but it was removed. Austin and El Paso’s approved ordinances do include the designation of a wage-theft coordinator by the city manager.