"Under-the-Table Pay Is Unacceptable"

Posted by: Nick Leiber on July 17, 2009

That’s the provocative headline on the latest feature within our ongoing Debate Room series. In it, two thinkers spar over what employers should do when it comes to compensating low-wage workers. It’s an important topic. Be sure to read both the essays, then weigh in with your thoughts.

Reader Comments

Val Powers

July 19, 2009 09:57 AM

I agree under-the-table pay is unacceptable. It creates a zero-sum game between taxpayers and non-taxpayers. It will come to a point (if it hasn't already) where state and local governments will be unable to fund projects for education, public health, etc. These groups will be forced to raise taxes even more, putting the taxpaying group at an even bigger disadvantage.

Increases in taxes will encourage more people to leave their job earning $15/hr on the books in favor of something similar that does not recognize taxes. Permitting under-the-table pay will undoubtedly snowball and younger generations will begin to view cheating the government as acceptable.

On the other hand, those being paid under the table are losing out on the benefits of being a taxpayer...so I guess you can say they get what they deserve. Taxpayers will receive social security later in life and those who did not contribute will be forced to rely on their own savings. Non-taxpayers are also prevented from filing for unemployment, workers’ compensation, or disability claims.

What happens when these people try to get loans or mortgages? They have no W-2 or way to verify their income.

Most importantly, it is illegal!

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What's it like to run your own company today? Entrepreneurs face multiple hurdles new and old, from raising capital and managing employees to keeping up with technology and competing in a global marketplace. In this blog, the Small Business channel's John Tozzi and Nick Leiber discuss the news, trends, and ideas that matter to small business owners. Follow them on Twitter @newentrepreneur.

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