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US - Federal wage and hour lawsuits jump 10%

May 14 2013

Employment law firm Seyfarth Shaw LLP reported that federal wage and hour lawsuits filed under the Fair Labor Standards Act reached a new high for the 12 months ending in March.

The firm reported 7,764 Fair Labor Standards Act cases were filed, up 10 percent from the preceding 12-month period. It cited data obtained from the Federal Judicial Center.

The bulk of the lawsuits include misclassification of employees, alleged uncompensated work performed off the clock and miscalculation of overtime pay for nonexempt employees, according to Richard Alfred, chair of Seyfarth’s wage & hour practice.

“With no clear catalyst during the past 12 months, this strong spike and new high for FLSA claims makes them one of the top threats to U.S. employers,” Alfred said in a press release.

Staffing buyers and staffing firms have been the subject of numerous such lawsuits. In one example, a staffing firm was ordered to pay $1.9 million in back wages.

http://www.staffingindustry.com/Research-Publications/Daily-News/US-Staffing-firm-to-pay-1.9-million-in-back-wages-25653

Alfred cites several factors which may be responsible for the increase in such suits:

  • Improving economy may provide incentive for plaintiffs’ counsel to sue new and relatively unsophisticated companies whose workforces are growing.
  • The economic recovery has seen an increase in employment demands on all workers, which may cause them to question their pay packages.
  • More lawyers may now be filing lawsuits perhaps motivated by large settlements in past cases.
  • Employees are more sensitized to wage and hour issues, at least in part as a result of their access to social media.

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