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October 26, 2012

HR Fact Friday: Wage and Hour Suits on the Rise

Filed under: General HR Buzz6:00 am

If you’re making a year-end checklist, here’s one more item you may want to include: Wage-and-Hour Audit

Federal wage-and-hour lawsuits have increased steadily over the past decade.  If you compare cases filed in 2011 to the number filed in 2000, you will find an increase of 380%.  That’s something worth noting.

In case you are wondering why there has been such an increase, there are several factors that most likely contribute:

    1. The poor job market may be leading unemployed or underemployed workers to look for ways to get money from current or former employers.  Lawyers are aware of the increase in lawsuits and are readily available to take on new cases presented to them.
    2. There is an increased awareness of wage-and-hour claims due to high profile cases.  Last year the headlines featured the Wal-Mart class action lawsuit including speculation as to the outcome.  This lawsuit, representing 1.6 million women, was the largest employment class action lawsuit in the Supreme Court’s history.
    3. Perhaps the convenience of having smartphone applications with links to easily contact the DOL has increased reporting of cases.  These apps both provide “A timesheet to record the hours that you work and calculate the amount you may be owed by your employer,” as stated by the DOL.  The DOL also reminds employees that “This information would prove invaluable during an investigation where an employer has failed to maintain accurate employment records.”

What Should You Do Now?

The most common wage-and-hour cases are related to misclassification, off-the-clock, and overtime-rate-miscalculation cases.  When conducting an internal audit, review your current positions to determine if they are accurately classified as exempt and non-exempt.  Utilize guides, such as forms and checklists found in HR Suite to assist you with this analysis.  Any changes that may have occurred in the job’s duties and responsibilities over the past few years could result in a change of classification.  Make sure all employees are properly paid for all of their time spent performing work, and that overtime and supplemental earnings are calculated correctly.  Additionally, utilize current salary survey information to review your employee’s wages with respect to market.

The increase in wage-and-hour cases sends a clear message to employers:  make sure you keep accurate, thorough records of your employees’ hours and wages because the DOL is making it very convenient for employees to track on their own and find resources to readily support their case.  Contact HRN for more information on products and consulting services that can assist you with this process.

This posting was written by Joyce Campbell, SPHR, HRN Content Manager.


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