The U.S. Department of Labor is cracking down on businesses that don’t properly pay their employees. Under the Fair Labor Standards Act – FLSA for short – employers must pay workers double damages if they have illegally failed to pay minimum wage, failed to pay overtime at time and one-half pay or failed to pay for all hours worked. Collectively these violations are called wage theft.
Common Employee Misclassification Schemes
Often employers engage in employee misclassification schemes and falsely tell workers they are exempt from overtime. Congress has amended the Fair Labor Standards Act several times and filled it with loopholes that allow some employers to escape paying for overtime or for actual hours worked. Common employee misclassification schemes include improperly classifying workers as “professionals”, admin workers or “managers.”
The FLSA was passed at the tail end of the Great Depression. Millions of Americans were out of work. Some unscrupulous employers took advantage of those who were working and forced them to work 70 or 80 or more hours without extra pay or made others work for literally pennies. Despite the emergence of exemptions that allow employers to avoid overtime, courts are still quite liberal in their interpretation of the law. The goal of the law is protect workers, not big corporations.
If you have been misclassified for wage purposes, your employer is liable for double damages and legal fees. Your employer is also responsible for properly tracking your hours. As long as your boss was aware that you were working beyond 40 hours, proving damages is relatively easy.
Industries with a History of Employee Misclassification
While many businesses continue to engage in employee misclassification, some of the biggest violators by industry are:
- food service
- performing arts
- health care
- janitorial services
- Internet services
- oil and gas / energy
- cable installation
- car service
Whether or not you are in one of the targeted industries (the “hit list“), understanding your rights is the most important first step. Know when you should be paid for all your hours worked and when you should receive time and one half pay.
Many workers go years thinking they are exempt from overtime simply because they are considered salaried. Employers want you to think this is true but often it is not.
Generally, workers can make a lost wage / lost overtime claim for up to 24 months. In some cases the time period is extended.
The Labor Department’s FLSA and employee misclassification rules affect wages and pay. There are similar but separate tests for taxes, unemployment and workers compensation.
Filing a wage theft claim is easier than it sounds. Because employers must pay the worker’s legal fees when the employee wins, good lawyers will take these claims. Employers are also afraid to drag out wage theft cases knowing that legal fees will continue to mount.
Think you are a victim of wage theft? Give us a call. Our FLSA lawyers are not afraid to aggressively pursue your claims. From a single claim to our national collective action on behalf of tens of thousands of Uber drivers, we work to insure that you are properly paid.
For more information*, contact attorney Katherine Holiday at or by telephone at 202-800-9791. The author of this post, attorney Brian Mahany, can be reached at All inquiries are protected by the attorney-client privilege. We pursue cases nationally.
MahanyLaw – America’s Wage and Overtime Lawyers
- Check out our FLSA FAQ page too.