Wage and Hour (W&H) exposure risks are frequently misunderstood and inadequately funded. The idea that W&H claims can only be filed for either failing to pay overtime or falsely representing one’s employment status as exempt or non-exempt is widespread. However, W&H’s liability also covers claims regarding
- Underpayment of overtime
- Wage miscalculation
- Denying employee breaks
- Assuming that work will be done outside of regular business hours
- Neglecting to pay employees on time
- Not compensating exempt workers for time missed from work
- Only paying the federal minimum wage when state minimum wage requirements mandate a higher rate.
You should get guidance from a legal advisor at Sattiraju & Tharney when filing claims for these disputes.
The commonest allegations in cases about wage and hour
It is widely believed that W&H claims are limited to either failure to pay overtime or incorrect designation of an employee’s employment status as exempt or non-exempt. However, W&H’s liability also covers claims about underpayment of overtime, wage miscalculation, disallowing employee breaks, anticipating off-the-clock work, failing to pay employees regularly, refusing to compensate exempt employees for missed work, neglecting to pay for the time required to put on or remove protective gear or clothing, and only paying the federal minimum wage when state minimum wage requirements call for higher compensation.
Small to midsize operations
Coverage is typically limited to sub-limited defense costs for small and mid-sized companies, with no indemnity for settlements or verdicts. Certain company classes, including franchisees, restaurants, and healthcare professionals, may not be allowed to access even the restricted offerings in certain areas.
For small and medium markets, the sub-limits for defense costs only now range from $50,000 to $150,000. Employers may be allowed to negotiate an option worth up to $250,000 in a limited number of situations. But carriers have started to retreat in light of the plaintiff’s bar’s attention and the heightened focus on W&H laws.
Why it is advised to stay out of this lawsuit
Wage and hour laws cost a ton of money. It could also lead to problems like:
- Penalties for civil money
- Refunds
- The cost of foregone benefits
- Payment of interest
- Liquidated losses
- Legal fees
- Remedy through injunction
- Criminal Defense
- Detention
- Damage to reputation
- Lower morale among employees
A rise in attrition
Legal experts advise employers not to contact the plaintiff’s attorney directly to discuss the matter. Anything the employer divulges to the plaintiff’s lawyer may be used against them.
- Don’t be in a hurry to tell staff members or the media about the lawsuit.
- Furthermore, avoid attempting to talk to the plaintiffs about the matter.
- Regarding the case, do not send memos or emails to other parties.
Reducing the possibility of wage and hour litigation
Remaining current with wage and hour trends might help you avoid lawsuits later on and stay ahead of the curve. Additionally, the personnel handling payroll and HR must be educated, experienced, and dedicated to providing excellent customer service. Simplifying your payroll and HR administration procedures is also crucial to lower wage and hour errors.
Conclusion
Employers must be cautious in appropriately managing their workforces as the number of labor law infractions and lawsuits increases, or else they risk incurring additional expenditures for litigation, penalties, and unpaid salaries. Businesses must examine employee categories and HR regulations to prevent costly errors.
Furthermore, although hard to find, Wage & Hour Liability coverage is offered. When navigating W&H hazards, keeping a solid relationship with an informed wholesale CRC Group producer with significant industry expertise and numerous marketplace connections can make all the difference. For further information, get in touch with your CRC Group producer.
