August 22nd, 2012

In our last post we talked about wage and hour issues with unpaid internships. Many interns have spoken out over the past few years about the fact that while they are treated in many ways like normal employees, they are not compensated. These issues are being seen in other parts of the workforce as employees begin to take a more thorough look at their job duties, the hours they work, and their compensation.

Lawsuits brought by employees over contested overtime pay or lost wages have reached a 20-year high. Over the 12 month period ending in March, there were 7,064 lawsuits considered to be wage and hour complaints. Since the year 2000, this number has gone up steadily. Back then, only 1,854 lawsuits were fired within a 12 month period.

High unemployment rates can be an incentive for employees to work off the clock, since some may fear losing their jobs if they do not meet expectations. Many employees pursue a legal remedy only after they are fired because they’re not worried about retaliation anymore.

Vague language in the Fair Labor Standards Act has also contributed to a high rate of employees bringing these cases. That law indicates that employees who are in executive roles, sales roles, and other professional roles are exempt from entitlement to overtime pay. However, these roles are rather loosely defined and there can be a lot of grey area, especially in small businesses where employees take on a wide variety of tasks.

More information about wage and hour violations is available on our Minnesota employment law website.

Source: Bloomberg, “Worker Wage-and-Hour Suits Rise in Difficult Labor Market,” Emily Grannis, August 15, 2012.

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