Violations of the FLSA Can Be Costly

The damages that an employer can face for violating minimum wage or overtime wage laws can be severe. Under the FLSA an employer who wilfully violates any of the FLSA's provisions faces a fine of up to $10,000 per violation and/or imprisonment for up to six months. 29 U.S.C. § 216(a). An employer can also be liable to an aggrieved employee for two times the amount of the unpaid minimum wages or overtime compensation, litigation costs and attorneys' fees. 29 U.S.C. § 216(b).

The U.S. Department of Labor is the federal agency that oversees compliance with the FLSA and other labor-related regulations. A review of some cases brought against New England area employers demonstrates how severe damages for FLSA wage violations can be. For example:

East Hartford, CT - Three related drywall companies were ordered to pay 35 employees $57,600 in back wages and $14,000 in liquidated damages to resolve legal actions taken against them by the U.S. Department of Labor for failing to pay employees proper overtime wages and to maintain adequate and accurate payroll records.

Johnston, RI - Three related asbestos removal contractors and their principal officer were ordered to pay 70 employees $45,000 in back wages and $15,000 in liquidated damages (plus interest); they also agreed to pay $15,000 in penalties to resolve legal actions taken against them by the U.S. Department of Labor for failing to pay proper overtime wages and failing to maintain adequate and accurate payroll records.

Brighton, MA - A towing company was ordered to pay 47 employees $52,000 in back wages for failing to pay proper minimum wages and overtime wages and for failing to maintain adequate payroll records.

West Haven, CT - An asbestos and lead abatement contractor was ordered to pay $20,000 in back wages to 46 employees for failing to pay overtime wages and failing to maintain adequate payroll records.

Stamford, CT - A real estate company that manages apartment complexes and shopping centers was ordered to pay 17 maintenance employees $27,805 in back wages as the result of a court order issued by the U.S. District Court for Connecticut.

Waltham, MA - A health and racquet club was ordered to pay 63 employees $50,650 in back wages as the result of a judgment issued by the U.S. District Court for the District of Massachusetts for failing to pay overtime wages to clerical staff and cleaners and to some salaried workers improperly classified as "exempt" employees by the club.

Conclusion

As you can see, ever changing federal and state minimum wage and overtime wage laws can be complex and confusing to both employers and employees. The issues discussed in this article are meant to serve as a brief overview of some of the challenges faced by members of an ever growing labor force and are not meant to substitute for the competent legal advice of qualified lawyers. If you have questions, concerns or problems of a labor-related nature, you should seek out the advice of a skilled lawyer.

NOTE: The issues discussed in this article do not constitute legal advice. The author's objective is to alert the reader to some common issues surrounding minimum wage and overtime wage laws. Anyone having a question or problem related to minimum wage, overtime wage, or labor law in general should be guided by the advice of his or her lawyer under applicable federal and state laws and after a full and confidential disclosure of all relevant facts.