In one of my very first posts way back in 2007, I said this:
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.
Since that time, the numbers of lawsuits have only increased. Indeed, during the 2013-2014 year, a record 8126 federal wage & hour cases were filed. That is up over 436 percent since 2000.
The attorneys’ fees and the existing potential for additional damages have long been a large incentive for attorneys representing employees to bring these claims.
Heck, fellow blogger and Connecticut lawyer Richard Hayber alone lists 18 class action claims on his site for people to get involved with (you’re welcome, Rick.).
And yet, for some reason, the Connecticut General Assembly thinks that this is somehow an underrepresented area of litigation.
Why do I make that conclusion? Because last week, the Labor & Public Employee Committee approved of a bill (Raised Bill 914) that would mandate double damages in cases of a failure to pay overtime wages unless the employer could prove that it had a “good faith belief” in its underpayment.
Let’s be clear: That good faith belief standard — which isn’t defined in the bill — would be a very high hurdle to clear. And it would make settlement of cases much more expensive.
For that reason, the CBIA has opposed the bill stating it “discourages employers from ever being able to challenge employee wage claims, because the only possible results would be to pay double damages if wrong on the claim or pay high legal costs to be proved right.”
Whatever the legislative intention, this is yet another bill in search of a problem. Indeed, if anything, the wage & hour lawsuit craze is booming right now. Passage of the bill would only create additional incentives for litigation.
There’s still a long way to go in this legislative session, but bills like these are giving employers in Connecticut a good deal of heartburn.