Wage and Hour Lawsuits Spike

Wage and Hour Lawsuits SpikeWage and hour lawsuits are on the rise, as concerns mount that American firms may not always pay their employees fairly.

The Huffington Post reports that collective action lawsuits, in which wage and hour violations are alleged, have risen by a massive 400% in the last 11 years, citing CNNMoney. Last year, more than 7,000 collective action lawsuits over wage and hour violations were filed, a significant increase since 2000. Claims involve employees who allege they were never paid the full amount for the hours they worked. In some cases, employees were wrongly listed as ineligible for overtime, in others, workers were just never paid for the work they completed.

These types of claims, according to attorneys cited in a 2007 Bloomberg article companies are spending more than a billion dollars annually to resolve these cases, said The Huffington Post. Taco Bell was sued over allegations it forced employees to work unpaid hours. This is just one in a string of similar cases with which Taco Bell has been faced, noted The Huffington Post. Starbucks, Wal-Mart, Bank of America, Oracle, IBM, Fremantle Media, Hooters, Groupon, and Boston Market have also been faced with lawsuits alleging that they didn’t appropriately pay staff for hours worked.

Sadly, noted The Huffington Post, the weakened economy has made it easier for management to extract more work out of staff while paying less.

We’ve long followed wage and payment issues involving workers inadequately compensated or unprotected. We recently wrote that two unpaid interns who worked on the set of the popular movie “Black Swan,” filed suit in federal court in Manhattan against Fox Searchlight Pictures claiming that the way the studio treated interns violated wage and overtime laws. They seek back pay and an injunction against the studio for improperly using unpaid interns on future projects. According to a press release issued by the plaintiffs’ attorney, the lawsuit also seeks class action status on behalf of more than 100 unpaid interns on various Fox Searchlight productions.

Last year, we wrote that the U.S. Department of Labor was investigating some of the largest homebuilders in the country over possible wage law violations. Homebuilders targeted by wage theft probe included PulteGroup Inc., Lennar Corp., D.R. Horton Inc. and KB Home. According to a report in The New York Times, the Labor Department was trying to determine if these and other residential homebuilders failed to pay workers minimum wage or overtime pay.

We previously wrote that the so-called “Nanny Law,” The Domestic Workers’ Bill of Rights, provides protection for a variety of employees—home workers and caregivers for the elderly, nannies, and other domestic employees. If full-time, these employees are now eligible for temporary disability benefits as well as other protections for sexual harassment and discrimination in the work place, the New York Times explained. Employers must pay time-and-a-half for overtime, give no less than three annual vacations days, and keep to a legal workday. The legal workday is eight hours; 40 hours is a legal week unless the worker is live-in, and then it is 44 hours. At the time of the law’s passage, at least four complaints had been filed against employers.

Effective last April 12, New York employers faced tougher penalties if they violate wage and hour laws. The state’s New York Wage Theft Prevention Act (WTPA) imposed new notification requirements on employers. For instance, the New York WTPA raised the liquidated damages recoverable by employees who win a civil or administrative action for unpaid overtime; employees who file successful unpaid overtime lawsuits may also be awarded for other penalties and fees and employers may be subject to criminal penalties, fines, and prison time in certain circumstances concerning, for example record keeping. Among other things, the WTPA requires employers to provide notice to newly hired employees of the basis for the wage payment and if wage deductions—for example, meal or lodging allowances—will be claimed.

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