Lawsuits related to wage disputes have increased by 77% over the past four years, according to the National Employment Lawyers’ Association. (NELA), an organization of attorneys who help employees file lawsuits and other actions against employers.
It was about four years ago that the U.S. Department of Labor (DOL) toughened the overtime rules under the Fair Labor Standards Act (FLSA) and since that time, wage-related FLSA lawsuits have ballooned. Besides the dramatic increase in lawsuits, NELA found that DOL has amplified its wage enforcement actions by 11%.
Some common causes for wage-related lawsuits have been:
- Unpaid overtime when employers misclassify employees. Employers often incorrectly assume that paying employees a salary means they do not need to pay them overtime pay.
- Making employees use their own money to buy uniforms or equipment or for other company purposes.
- Not accurately recording time worked or requiring employees to work off the clock.
- Not paying employees for putting on (“donning”) and taking off (“doffing”) safety equipment.
The best thing that employers can do to avoid these costly lawsuits is to closely analyze how employees are being paid, confirm that those employees classified as exempt from overtime pay are actually performing job duties that qualify them as exempt under the FLSA. Employers should also conduct regular audits of their policies and procedures to make sure that they are following all FLSA regulations and ensure that all supervisors and managers routinely receive training in what is and is not allowed under FLSA.
