Why Paying Attention to Wage and Hour Compliance is IMPORTANT

by Michael Haberman on December 6, 2012 · 0 comments


 

Mistakes with the FLSA can cost you a lot of money and I guarantee you are making mistakes.

I have stated many, many times on this blog that paying attention to compliance issues, particularly those regarding the Fair Labor Standards Act is important. Here are some of those posts:

Pay Attention Managers: You have to track time ACTUALLY WORKED!

A VERY EXPENSIVE Lesson in NOT Following the Rules

It Will Cost Me How Much? A Story of Misclassification and Improper Deductions

Five Steps to Diminish Wage & Hour Problems: Revisited

There are many more, just do a search on FLSA on our search bar and you will see them all. But here is another lesson on why paying attention to wage and hour compliance is important.

Headlines from the USDOL

I received this newsletter from the U.S. Department of Labor that included these headlines.

  • San Francisco-based bank pays more than $1 million in overtime back wages to employees in 5 states following DOL investigation. The U.S. Department of Labor has recovered $1,009,643.93 in overtime back wages for 392 First Republic Bank employees in California, Connecticut, Massachusetts, New York and Oregon. An investigation by the department’s Wage and Hour Division found that the San Francisco-based bank wrongly classified the employees as exempt from overtime, resulting in violations of the Fair Labor Standards Act’s overtime and record-keeping provisions.
  • DOL sues Los Arcos Mexican Grill and Seafood in Tennessee to recover unpaid minimum and overtime wages for 70 employees. The U.S. Department of Labor has filed a lawsuit against Los Arcos Seafood and Grill Inc., doing business as Los Arcos Mexican Grill and Seafood in Nashville, and its owners, Jose Gutierrez Jr. and Martin Romo, for allegedly violating the Fair Labor Standards Act. The department is seeking $227,366 in back wages plus an equal amount in liquidated damages for 70 employees.
  • RJ Concrete in Fuquay-Varina, NC, to pay 12 employees nearly $38,000 in back wages following DOL investigation. RJ Concrete Inc. of Fuquay-Varina has agreed to pay 12 current and former employees $37,783 in back wages following an investigation by the U.S. Department of Labor’s Wage and Hour Division that identified violations of the Fair Labor Standards Act’s overtime and record-keeping provisions. RJ Concrete is a contractor engaged in the construction of residential basements.

Just three companies and fines totally nearly $1.3 million for overtime and recordkeeping violations.

You are making a mistake

It is almost a certainty that you are making a mistake under the FLSA. I feel certain that you have someone, maybe many, who are not recording their time correctly. I feel certain that you have an employee who is misclassified as exempt when they are in reality nonexempt. I met someone the other day that told me “We don’t have to worry about overtime because we pay everyone a salary.” Well if you know what is wrong with this statement you know why my brain was sounding alarm bells, even though my mouth was saying “you may want to revisit that.” If you don’t know what is wrong then you are most likely making that mistake. I bet you are also incorrectly deducting pay from an exempt employee’s pay.

I am so sure of this that I would be willing to bet you a HIGH FEE for doing a FLSA review versus a FREE review if you are 100% clean. (This statement is just to illustrate how sure I am of finding an error, but hey, if you are interested let’s talk. Travel expenses are not included in the free part.)

Before you call me you may want to read the posts I listed at the outset of this post and the other ones you will find on my website. Then decide if you want to risk it. Of course finding out on your own is much better than finding out when you get that letter that says “Hi, we are the USDOL Wage & Hour Division and we are going to come visit you.”

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