Wage and hour lawsuits in the workplace, the new revolution

A growing number of workers seem to feel American companies have a problem with paying their employees.

According to recent research collective action lawsuits alleging wage and hour violations have risen 400 percent since 2000. In 2011, there were more than 7,000 such lawsuits filed in federal court.

These lawsuits allege violations of the Fair Labor Standards Act when workers did not get paid the full amount for hours they worked — either because they were improperly listed as ineligible for overtime, or because they simply never received a paycheck for their work.

Violations of wage and hour laws have become increasingly pervasive over recent years. Lawyers cited in a 2007 report regarding wage and hour lawsuits estimated that companies may be paying out more than a billion dollars per year just to resolve these allegations.

Sixty-eight percent of low-wage workers interviewed for a 2009 report said they had experienced a pay violation in the previous work week, including 26 percent who were paid under the minimum wage and 76 percent who didn’t receive overtime pay.

No major company seems to be immune to this type of lawsuit. One recent example; Taco Bell was hit with a lawsuit alleging that employees were often forced to work unpaid hours. But other companies who have also witnessed this surge include Starbucks, Wal-Mart, Bank of America, Oracle, IBM, Fremantle Media and the Hooters restaurant chain.

In general, the weak economy and sluggish labor market have been blamed. Due to the reduced amount of leverage employees have within their relationship to their managers it’s been especially easy in recent years for bosses to demand ever more of workers while paying them the same amount as before.The recession has fostered an environment of employers who have to cut corners in order to cut costs.

Employers need to look at their time-keeping systems, training programs, job descriptions and responsibilities, and actual practices to make sure they are following federal and state laws.

If you are a non-exempt employee, make sure you record all of the time you work.  And, if you are required, encouraged or even asked to work off the clock without being paid, you should bring it to the attention of someone with the ability to correct the problem.