Connecticut Employment Law Blog Insight on Labor & Employment Developments for Connecticut Businesses

“Wage Wars” – Business Week’s Analysis of Overtime Lawsuits

Posted in Class Actions, Human Resources (HR) Compliance, Wage & Hour

For employment lawyers and HR professionals, it’s "old" news that overtime lawsuits are a major concern.  Business Week picks up on that trend in next week’s Cover Story entitled: "Wage Wars: Does your Boss Owe You Overtime"

According to the article:

No one tracks precise figures, but lawyers on both sides estimate that over the last few years companies have collectively paid out more than $1 billion annually to resolve these claims, which are usually brought on behalf of large groups of employees.

Yes, you read that right. A BILLION dollars. 

Is this estimate true? Who knows.  But considering that the Labor Department estimates that 86 percent of the workforce is subject to overtime rules, that number suggests that there may still be lots of other potential lawsuits out there.  Connecticut has had no shortage of these lawsuits either. 

What’s an employer to do? Clearly, some pro-active steps are always in order. 

  • Audit your exempt employees.  Go over job descriptions and compare that with actual duties.  Sometimes "managers" are just glorified sales workers.
  • Take seriously any complaints by employees about their overtime.  If there is a problem, odds are the complaining employee isn’t the only one with the problem.  And that means the potential for a class action case. 
  • Educate your Human Resource personnel and, even better, your payroll people about the overtime rules.  In particular, even if people are receiving overtime, make sure its calculated correctly.
  • When in doubt, get advice.  These issues never get "better" overtime. If anything, when overtime issues are allowed to fester, the risk for companies increases substantially.  Working with an attorney and payroll personnel to comply with the law with ensure that the little issues don’t turn into big ones. 

We’ll discuss more about wage and hour claims in upcoming posts, but for background on the issue, the Business Week article is a good background piece.

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