KMK Law Management Rights Blog

For employers, compliance with wage-hour laws, including the Fair Labor Standards Act (“FLSA”) is more important than ever.  A top lawyer at the Department of Labor (“DOL”) stated earlier this month during a conference that the DOL has a new emphasis on investigations of potential FLSA violations.  Although employees can file a complaint with the DOL about alleged wage-hour issues, the DOL is not waiting for complaints to be filed.  The DOL is proactively initiating investigations of employers’ wage-hour compliance.  The DOL has found violations in 71% of the investigations it initiated on its own.

The DOL has boasted about its many large settlements with companies of various sizes, including several multi-million dollar settlements.  In 2012, the DOL collected over $224 million in back wages for employees as a result of its investigations into wage-hour compliance.  Employers must also fear class action lawsuits filed by employees claiming wage-hour violations.  These costly types of cases continue to increase in number.

Employers must review their wage-hour practices to ensure they are not vulnerable to a finding that they violated the FLSA or state law.  Employers should review their wage-hour practices in the following areas, which are often the focus of a DOL investigation or class action lawsuit:

• Whether individuals are properly classified as independent contractors rather than employees;
• Whether employees are properly classified as being exempt employees under the FLSA;
• Are employees performing work duties outside of their work hours for which they should be compensated, such as checking email from their phone, donning and doffing required work attire, or preparing their workstations;
• Whether the employer is properly calculating employees’ “regular rate” for purposes of overtime compensation;
• Whether employees are being properly compensated for time spent traveling for work; and
• Is the time employees spend on meal and/or lunch breaks being properly accounted for.

The rules regarding these areas can be difficult for employers to understand and comply with.  An audit of the company’s policies is crucial to minimize the risk of future liability relating to wage-hour practices.  Our wage hour attorneys stand ready to assist you with auditing your current practices or answering any questions you may have.