Wage lawsuits surging as new rule looms

| Dec 21, 2015 | Wage And Hour Laws |

California employers may find that it can be difficult to stay abreast of wage and benefit requirements for their workers. However, attention to detail is extremely important because in some cases there is strict liability for violating minimum wage and overtime laws. In 2016, a new rule is expected to more than double the overtime exemption level for workers on salaries, which means that overtime benefits could be available to millions of additional workers. The current level at which exemptions come into play is $23,660, and it will increase to $50,440 if this U.S. Department of Labor rule takes effect.

Legal action was significant throughout 2015, and at least 9,000 suits were filed in the first nine months of the year alleging federal wage and hour violations. Many more suits were filed at the state level. Statistics indicate that filings at the federal level have increased by more than four times since 2000. One of the leading reasons for so many suits may be that a defense can be difficult because of the strict federal standards. Another factor may be that errors are easily made because of extensive regulations. Additionally, class actions are common, and collective judgments are often made in such cases rather than person-by-person corrections.

Classification will continue to be a major concern for employers. Independent contractors are typically not due any benefits, but those who perform consistent work may be considered as employees. Because the DOL has been addressing violations aggressively, some employers may need to re-evaluate their relationships with certain employees.

People who believe that they have not been paid correctly when they are entitled to overtime might begin by addressing the issue with an employer or with a company payroll or human resources representative. If violations of overtime rights are not corrected, legal action might be appropriate.


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