Thursday, September 4, 2014

“Wage Theft” – New Name, Same Concern

“Wage theft” is becoming a popular phrase in the media. A New York Times article recently announced that “More Workers Are Claiming ‘Wage Theft.’” Other news outlets are using the phrase to describe lawsuits brought by workers of a wide mix of employers, ranging from Jimmy John's to NFL franchises. “Wage theft” even has its own website.

At its core, “wage theft” is simply a catchphrase designed to draw attention to violations of wage and hour laws. The use of the term “wage theft” appears to be a relatively recent phenomenon. There were more references to “wage theft” in U.S. newspapers during the last six months than there were in the entire span from 2000 to 2010. 

While the “wage theft” catchphrase is relatively new, the wage and hour laws it references are not. Most of these laws have been around for decades. The primary wage and hour law—the federal Fair Labor Standards Act (FLSA)—was enacted in the 1930s. In addition, most states have longstanding wage and hour laws that similar to or more protective of employees than the FLSA. 

A heightened focus on wage and hour issues is also not new, despite the new “wage theft” lingo. Employers have been facing an uptick in wage and hour litigation and a political and social movement to increase wages for years. Employers should recognize, however, that the loaded “wage theft” terminology and the increased publicity about so-called “wage theft” is a sign of the growing sophistication and coordination among plaintiffs’ attorneys, unions, and government regulators. These publicity efforts are designed to increase knowledge of workers’ rights and they appear to be working. 

In light of the current wage and hour climate, employers should be vigilant about wage and hour compliance. Catchphrase or not, efforts to publicize “wage theft” will likely increase employees’ awareness of their rights and increase the risk of lawsuits. Employers should proactively seek to avoid wage and hour issues by:

·      Training human resources and managers on wage and hour compliance;

·      Carefully evaluating exempt and non-exempt job classifications;

·      Having compliant and well-publicized policies in place for employees on wage and hour  issues, including policies that address how to raise concerns about any improper pay deductions, the employer’s work week, non-exempt employee breaks and work rules, and any remote work by non-exempt employees;

·      Paying at least minimum wage and overtime pay to non-exempt employees for all working time;

·      Paying employees who engage in unauthorized work, addressing this problem through discipline (up to and including termination) rather than pay processes;

·      Keeping accurate records and avoiding even the appearance of pressure to falsify timecards;

·      Avoiding an improper designation of workers as independent contractors;

·      Taking care to consider state and local laws, in addition to federal regulations;

·      Seeking counsel on complex determinations and issues that are bound to arise; and

·      Revisiting and reevaluating these issues periodically, particularly when workers’ roles and duties change.

No comments:

Post a Comment