Overtime, Unpaid Wages or Wage theft occurs when employers take certain steps that have the net result of paying an employee less than he or she is entitled to receive by law. Examples are refusing to pay overtime or commissions, paying less than the minimum wage, forcing employees to work off the clock, taking employee tips and misclassifying employees as independent contractors. Each year employees collectively lose millions and millions of dollars because of employer wage theft.
The Fair Labor Standards Act (FLSA) requires that certain “covered” employers pay eligible employees overtime, or time-and-a-half, for each and every hour worked over 40 hours in the employee’s workweek. In order for an employer to be a covered employer, the employer must have two or more employees and have gross revenues of at least $500,000 per year. Alternatively, an employee may still be entitled to overtime if he or she is regularly involved in interstate transactions, such as dealing with customers or vendors in other states, processing credit cards or payments for customers in other states, or traveling other states in furtherance of their job duties. Only “employees” as defined under the FLSA are required to be paid overtime. Independent contractors are not entitled to receive overtime under the FLSA. Employers sometimes misclassify employees as independent contractors with the specific intent of avoiding an obligation to pay overtime.
Employers also sometimes claim that if an employee receives a salary as opposed to an hourly wage, then the employee is not entitled to receive overtime. While certain employees are exempt from required overtime, the mere fact that an employee is salaried does not relieve the employer of its obligation to pay overtime. Only those salaried employees that perform management or executive-type duties, such as hiring, firing or supervising, are exempt. We routinely see situations where the employer fails or refuses to pay overtime to salaried employees that perform hourly-type duties, and who do not supervise, hire or fire employees. This is another example of wage theft.
Employees can recover unpaid overtime going back only two years from the date the lawsuit is filed. If the employee can demonstrate that the employer knowingly or willfully violated the law, then the employee can recover up to three years of unpaid overtime. This statute of limitations runs until the employee files suit to recover overtime. This means that for every day the employee waits or delays in filing suit for unpaid overtime, the employee is potentially losing wages that can never be recovered. In addition to the recovery of unpaid overtime, a successful claimant is also entitled to the recovery of liquidated damages, which is an amount equal to the underlying amount of unpaid overtime.
If you have a wage and hour dispute or suspect your employer is shortchanging you, call (239) 262 4180