Lawsuits over federal wage and hour laws have risen over the last decade as more workers go to court to get back at their employers.
In the U.S. there were 7,064 federal wage-and-hour cases filed during the 12 months ending March 31, a number that has grown almost every year since 2000, when the total was 1,854, according to the Administrative Office of the U.S. Courts, which plans to release the data publicly later this year, according to Bloomberg News.
The number of cases filed with the U.S. District Court in Kansas has risen steadily from 13 in 2001 to 75 in 2009 before falling to about 45 suits in each 2010 and 2011.
Attorneys say workers who have been laid off or fired sometimes seek compensation through the court, whether justified or not.
Jason Rozger, a partner at Beranbaum Menken LLP in New York, which represents employees, said high unemployment gives companies leverage to compel work off the clock because people are worried about losing their jobs. That changes once they get fired, he said.
“As unemployment goes up, people get laid off and they’re no longer worried about retaliation,” Rozger told Bloomberg.
Many violations are settled with a letter to the employer pointing out the violation and the law, said Don Peterson of Withers, Gough, Pike, Pfaff & Peterson in Wichita.
Peterson and colleague Sean McGivern, who have filed a number of suits on behalf of workers, said they see lot of people, angry about being laid off or fired, in their office. They turn down a lot of cases, especially those seeking some kind of wrongful termination lawsuit, because there just isn’t any legal support. But wage and hour law is different, they said. It puts much of the burden on the employer.
Employers are required to document their pay practices, so there should be relatively little dispute over the facts of the case. If there’s a violation, the employer’s records should show it.
If the employers don’t keep the records, they have to show why they are in compliance with the law.
That allows Peterson and McGivern to argue the law and tends to push parties into settlements.
“We run into (employers) who don’t seem to be trying that hard,” Peterson said. “Because you only get paid when you win, you go after the easiest targets and those are the one who just don’t care.”
Danille Leon worked for at a small group home for developmentally disabled adults in Newton, working 70 or 80 hours per week, at $8 per hour.
She and more than 20 coworkers signed onto a wage-and-hour suit filed in 2010 saying that they were paid their hourly rate for their time, but weren’t paid time-and-a-half for work beyond 40 hours, according to the suit.
Leon said that, at first, she didn’t feel taken advantage of. She made good money because of all the hours she worked.
After two months she was named a manager, got a small pay raise and worked even longer hours.
But eventually she had a falling out with the owners and was fired.
The suit was settled last year and the workers received back overtime pay. But Leon received pay only for the two months before she became a manager. When she saw the others getting back pay and thought about her own treatment, she grew bitter.
“I‘m still mad,” she said. “I hate the place.”
Attorney Boyd Byers of Foulston Siefkin, who has generally represented employers in such cases, said there are three basic categories of violations of the wage and hour law:
• Overtime, in which overtime isn’t properly paid for the work performed. This gets into the issue of whether an activity, such as being on-call or traveling to a work site, constitutes work.
• Classification, in which there is a disagreement over whether an employee is exempt or non-exempt. Federal law includes tests on what constitutes an exempt employee.
“You can’t just magically turn them into an exempt employee by paying them a salary,” Byers said.
• Overtime rate miscalculation, in which an employer doesn’t include pay such as differentials or bonuses in calculating overtime.
The attorneys said that it’s usually less a matter of malice on the part of employers than recklessness or ignorance.
Small employers, typically without professional human relations staff, often will simply embrace the practices of other businesses in the industry without seeing if those practices are legal, Peterson said. Some employers are complacent in using pay practices that are convenient or profitable for them and don’t want to know the law.
“It’s usually not that they’re trying to be bad, trying to squeeze extra work out of them,” Byers said. “It’s just ignorance. They just don’t know.”