Workforce Management Best Practices for Avoiding Wage & Hour Lawsuits and Fines
Workforce Management Best Practices for Avoiding Wage & Hour Lawsuits and FinesAs an employer, you’ve never been at greater risk of getting sued by your employees in a labor dispute. In fact, wage and hour lawsuits have skyrocketed by 438% since the year 2000!
These lawsuits are crushingly expensive. In 2012, employers paid a total of $467 million in wage and hour settlements, or an average of $4.8 million per case.
Simultaneously, the U.S. Department of Labor (DOL) has intensified its wage and hour investigations against employers, adding 300 more investigators in 2011. DOL investigations typically don’t end well for employers. Of the more than 150,000 DOL investigations completed since 2007, 75% found employers in violations, costing them a total of $1.55 billion in back wages and $79 million in penalties.
Why So Many Lawsuits? Legal experts call this a litigation epidemic and cite a combination of causes:
- Wage and hour regulations are based on the 76-year old Fair Labor Standards Act (FLSA), a law designed for a different economy. That, combined with some ambiguous wording, makes it easy for today’s employers to run into trouble.
- We live in a litigious society. Employees are increasingly aware of the potential to sue their employers. Mere talk of raising the minimum wage has employees more focused on potential wage and hour violations.
- In some states, worker-friendly statutes and attitudes seemingly encourage litigation. This creates complex compliance challenges for multi-state employers.
- Plaintiff law firms are aggressively courting hourly employees, targeting low-wage industries via emails, ads, and social media. One big settlement in a particular industry can trigger a flurry of activity from other law firms.
What’s more, a surprising number of employers still lack adequate workforce management compliance controls, which makes them prime targets for wage and hour lawsuits. This is especially true for companies that manage an hourly or decentralized workforce because worker hours are that much harder to track, record, and control.
To read on and learn about the top 5 ways to avoid wage and hour lawsuits, download the full report, Top 5 Ways Not to Get Sued: Workforce Management Best Practices for Avoiding Wage & Hour Lawsuits and Fines:
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