In the past, companies were held accountable to the law if they misclassified workers or stole wages and hours. Today with modern technology, employees are often classified as independent contractors who lack basic protections such as minimum wage and overtime pay. These changes have allowed employers to exploit low-wage workers without any legal repercussions for decades.
The “wage and hour settlements 2021” is a lawsuit that has been filed by the United States Department of Labor. The lawsuit alleges that employers are not paying their employees for all hours worked.
The Fair Labor Standards Act (FLSA) is a federal statute that ensures that many employees get a minimum wage and overtime compensation. Workers who have had their FLSA rights infringed may band together and bring a collective action case, which is a sort of class action lawsuit.
The FLSA, which is enforced by the US Department of Labor, protects over 130 million American employees. Workers are additionally protected by state laws, which may give higher protections than the FLSA in certain situations.
Due to recent legislative changes impacting independent contractor categorization, overtime laws, and minimum wage hikes, wage and hour collective and class actions, which are currently among the most popular kinds of employment law litigation, are projected to continue at a rapid pace.
Employees must be informed of their legal rights to pursue legal action for breaches of wage and hour legislation if their rights—and the rights of other workers—are to be protected. If you believe that management is treating employees unfairly, contact ClassAction.com for a free case evaluation.
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A Brief History of the Fair Labor Standards Act (FLSA)
The Fair Labor Standards Act of 1938 prohibited child labor, provided the first minimum hourly pay (at 25 cents per hour), and established a maximum workweek of 44 hours.
The FLSA made good on FDR’s promise to “do something about the eradication of child labor, excessive hours, and starving pay.”
The FLSA was a landmark triumph for the labor movement and a legacy of President Franklin D. Roosevelt’s New Deal. It fulfilled the President’s promise that “Something must be done about the eradication of child labor, excessive hours, and starvation pay.” The FLSA was enacted in reaction to the Great Depression, when many companies took advantage of the labor shortage by exposing employees (including children) to hazardous working conditions and excessive hours.
Prior to FDR’s victory, state legislatures debated maximum hours and minimum pay, but the Supreme Court consistently overturned labor legislation. To get the FLSA approved, it would take three sessions of Congress and a dedicated effort on the side of proponents.
Under the FLSA, the work week was lowered from 44 to 40 hours per week in 1940. Gender wage disparities were forbidden by a 1963 amendment to the FLSA. The FLSA has also had minimum wage changes, the most recent of which was in 2009, when the federal minimum wage was increased from $6.55 to $7.25.
Wage Minimum
All covered, nonexempt employees (listed below) must be paid at least $7.25 per hour, according to the FLSA. However, many states and even municipalities have minimum salaries that are higher than the federal amount. Employees are entitled to the higher of the state, federal, or local minimum wage.
Minimum wages in Massachusetts, California, and the District of Columbia are all at least $10.00 per hour. Minimum wages in twenty-nine states, plus Washington, DC, are higher than the federal minimum wage. Eleven states (AZ, CO, FL, MO, MT, NJ, NV, OH, OR, SD, and WA) have a minimum wage that is tied to the consumer price index and rises every year.
In certain localities, city minimum salaries are even greater than state minimum wages. The minimum wage in SeaTac, Washington is $15.24/hour, and minimum wages in numerous localities are projected to rise to $10.00 – $15.00 by 2016-2021. State and federal minimum wage rules are superseded by city minimum wage legislation.
Employees who get tipped include waiters and waitresses.
Tipped workers, according to the FLSA, are individuals who get more than $30 in gratuities each month on a regular basis.
Unless their state minimum wage legislation specifies a greater rate of compensation, wait staff and other tipped workers are entitled to the FLSA federal minimum wage of $7.25/hour. Unless the state law requires a higher rate, employers must give tipped employees a cash compensation of at least $2.13/hour. The employer must make up the difference if the minimum cash pay of $2.13/hour plus tips does not equal $7.25/hour.
Tipped employees are the sole owners of their tips. Except in jurisdictions that have a separate “tip credit” (such as Florida, which has a maximum $3.02 tip credit per hour), employers may only claim a “tip credit” not to exceed $5.12/hour towards their minimum wage requirement (the minimum wage of $7.25 minus the minimum cash pay of $2.13 = $5.12).
The only time an employee does not have exclusive control of tips is when tipped employees have agreed to a lawful tip pooling or sharing agreement. An “invalid tip pool” is made up of workers who do not get gratuities on a regular basis (such as dishwashers and cooks). Employers are prohibited from keeping gratuities from a qualified tip pool for any reason other than tip credit.
Employers are also prohibited from reducing a tipped worker’s hourly compensation below the minimum wage by implementing deductions for walk-outs (i.e. “dine and dash”), breakage, cash register shortages, or uniforms.
Overtime
Covered, nonexempt workers must be paid overtime of at least 1.5 times their usual pay rate beyond 40 hours of labor in a workweek, according to the FLSA. For example, if a worker’s usual rate of pay is $10.00/hour, the FLSA overtime pay standards would entitle him or her to $15.00/hour.
Some states have their own overtime rules, much as they do with minimum wage legislation. When both state and federal overtime rules apply, the employee is entitled to extra compensation depending on the legislation that pays more. Some states, for example, demand overtime compensation after eight hours of labor each day or after six days of work per week. In several places, extra overtime may be needed in specific situations (double time pay is not required under the FLSA).
FLSA-Registered Employees
Only covered, nonexempt employees are protected by the FLSA’s minimum wage and overtime regulations. In order for FLSA regulations to apply, a worker must be regarded a “employee” of the employer (rather than an independent contractor).
Some workers are exempt from both the minimum wage and overtime compensation rules of the FLSA, while others are exempt from both. Workers who are not covered by the FLSA’s wage and overtime safeguards may be entitled to equivalent protections under other laws or via a special employment agreement.
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Employees Who Are Covered
Employees of some “enterprises” as well as people whose job includes interstate commerce are covered by the FLSA.
The FLSA should encompass workers for any of the following sorts of businesses:
- Agencies of the federal, state, or municipal governments
- On-site hospitals or institutes that care for the sick, elderly, mentally ill, or intellectually retarded (including public, private, for profit and non-profit hospitals and institutions)
- Schools for disabled or talented children, pre-schools, K-12 institutions, universities, or schools for handicapped or bright youngsters (including public, private, for profit, and non-profit schools)
- Companies and organizations having yearly revenues of at least $500,000
Employees who are not qualified for FLSA enterprise coverage are nevertheless protected if their employment includes interstate commerce on a regular basis. Although the word “interstate commerce” is broad, the courts have construed it in such a manner that it covers most workplaces.
Exempt Employees
The FLSA’s overtime and minimum pay regulations may not apply to all employees. Exemptions are granted depending on a worker’s wage, method of payment (salary or hourly), and job responsibilities.
The following aren’t all-inclusive lists. Contact an employment law attorney if you have any issues regarding whether you are an exempt employee.
Exemptions from overtime pay
Overtime compensation is not required for the following employees:
- Farmworkers
- Employees at movie theaters
- Employees who live in the employer’s home are known as domestic service employees.
- Railway and airline employees
- Taxi drivers and truck drivers who cross state boundaries in tractor trailers
- Some retail and service sector employees are paid on a commission basis.
- Workers who sell automobiles, trucks, trailers, agricultural equipment, boats, and airplanes
- Mechanics and clerks in the car, truck, and agricultural equipment industries
Exemptions from the minimum wage and overtime pay
Exemptions from overtime pay and minimum wage laws apply to the following workers:
- Employees in the areas of executive, administrative, professional, computer, and outside sales
- Employees who work at amusement parks or leisure facilities on a seasonal basis
- Employees of tiny publications, as well as those who distribute newspapers
- Employees of a fishing operation
- Agricultural employees
- Babysitters on the side
On December 1, 2016, a new overtime pay regulation for Executive, Administrative, and Professional personnel will take effect. During its first year, the rule, which redefines the income and compensation levels required for white collar professionals to be exempt from FLSA overtime requirements, is estimated to safeguard nearly 4 million people.
Have Your Workers’ Rights Been Infringed Upon? We can assist you.
You put in long hours, yet your boss may be taking advantage of you to maximize their personal profits.
Workers should be aware of their rights, according to ClassAction.com. If you violate your employees’ wage and hour rights, you may be eligible for legal action to recover lost wages.
Schedule a free case review to learn more.
The “unpaid wages settlement agreement” is a document that was created in response to the Stolen Wage and Hour Lawsuit. The document outlines the terms of an agreement between the plaintiff and defendant.
Frequently Asked Questions
How do you recover stolen wages?
A: The first step is to report the theft of wages. If you do not want your identity to be public, then a police report may be filed anonymously through an online form from the website https://www.stolenpaycheckcenter.com/.
Can I sue my employer for not paying me correctly?
A: Yes, you can file a lawsuit against your employer.
Is wage theft a crime in the US?
A: Yes, wage theft is a crime in the United States. It is considered to be a form of fraud and can be prosecuted as such under State laws.
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