Recent Surge in Overtime Lawsuits
According to a recent article, U.S. courts have seen a dramatic increase in overtime lawsuits in the past four years. Many workers are suing their current or former employers for failing to pay legally-required wages. Most of these suits involve claims made pursuant to the Fair Labor Standards Act ("FLSA"), which requires most U.S. workers to be paid at least minimum wage (currently $7.25/hour under federal law and higher in some states) and time-and-a-half for overtime hours (hours over 40 in a workweek).
The FLSA was passed in 1938 during the FDR administration as an effort to establish guaranteed minimum pay for workers, to assist workers in supporting their families without having to work excessive hours, and to decrease unemployment by incentivizing employers to spread work among a greater number of employees (rather than concentrating the work among fewer employees). Aside from a handful of minor amendments, the FLSA has not substantially changed in the 74 years since its passage. So what explains this recent increase in FLSA lawsuits?
Since the height of the recent recession, both employers and employees have been subject to enormous pressure. Employers are trying to survive on smaller profit margins, and are typically looking to shave costs wherever possible. Many employers have responded to this challenge by seeking increased production out of their existing (and often trimmed down) workforce. The result is that employers sometimes allow (or require) employees to work a greater number of hours without proper pay. This sometimes leads to employees getting paid less than minimum wage or being deprived of legally-required overtime pay. Employers often unlawfully (and sometimes intentionally) misclassify employees as exempt from overtime in order to avoid paying them overtime pay.
Like employers, employees too are victims of the negative economic climate. Many workers are working more hours for little to no extra pay. Some work "off the clock" because they are encouraged or required to do so by their employer. Sometimes, workers feel like they have to do whatever is necessary to keep their job because unemployment rates are high, and the prospect of becoming re-employed after losing or quitting a job seems remote. And it is common in this current age of technology for a job to encroach more into an employee's personal life by virtue of the employee staying in contact with the office during evenings and weekends with smartphones, ipads, and other devices. The line between an employee's work life and personal life has become blurred.
Common wage violations committed by employers include:
- The employer treating an employee as "exempt" and not entitled to overtime pay merely because the employee receives a flat salary, when the employee's job duties render the employee as non-exempt;
- An employee is asked to spend time engaging in work for which he or she is not paid (so-called "off the clock" work, i.e., duties performed before clocking in or after clocking out, such as preparation, clean-up, putting on or taking off safety gear, work performed during breaks, traveling between work sites after the start of but before the end of the business day, etc.). Such time may also include time during which the employee is not actively working but is "on-call" and also time spent attending mandatory work meetings or training;
- The employer fails to compensate the employee for overtime that was not "pre-approved." The law requires eligible employees to be paid overtime for all hours worked in excess of 40 hours per workweek if the employer knew or should have known about the time worked. Employees may be disciplined if they work unauthorized overtime in violation of the employer's policy, but the employer must still pay the overtime;
- Denial of overtime pay to commissioned employees who do not regularly travel away from the employer's workplace. Employees who perform inside sales, etc. are typically entitled to overtime pay if they are not regularly and customarily away from their employer's place of business (or for sales employees who work out of their home, regularly and customarily away from their home).
If you believe that your employer has denied you legally required pay, or if you want to learn more about your rights, you should contact a Missouri employment lawyer.
