The Cost of Rolling the Overtime Dice in Business and at Work
In my HR travels over the last 25 years or so, I always give my best compliance advice, often in concert with capable employer-side labor counsel – however, it’s ultimately the decision of the CEO and/or business owner to implement – or, as I’m periodically told (with gratitude): “Thanks for the advice; however I’m going to roll the dice.”
Last week and over the next two months, my capable employer-side labor lawyer colleague Joanmarie Dowling and I are sharing our best advice on how to comply with the December 1, 2016 Fair Labor Standards Act deadline raising the minimum salary threshold for exempt employees to $913 a week or $47,776 a year through a series of presentations to CEO’s, nonprofit Executive Directors, business owners and their key managers. In the spirit of that good advice, here’s the slide from our presentation outlining the risks involved in rolling the noncompliance dice:
A few more key points on the risks involved in not complying with the December 1st FLSA compliance deadline:
- The U.S. Wage and Hour Division may supervise payment of back wages.
- The Secretary of Labor may bring suit for back wages and an equal amount as liquidated damages.
- An employee may file a private suit for back pay and an equal amount as liquidated damages, plus attorney’s fees and court costs.
- The Secretary of Labor may obtain an injunction to restrain any person from violating FLSA, including the unlawful withholding of proper minimum wage and overtime pay.
- When it comes to recovery of back pay, there is a two-year statute of limitations, except in the case of a willful violation, where the statute of limitations is three years. (In NYS, the statute of limitations is 6 years.) When employers are found to willfully violate FLSA, they can also face criminal prosecution and fines up to $10,000 per violation. Upon a second conviction, employers could face imprisonment.
- U.S. DOL’s budget for FY 2017 includes $277 million for wage and hour division enforcement, an increase of $50 million from FY 2016.
How will you manage the cost of rolling the dice (or not) with regard to the December 1, 2016 FLSA compliance deadline in business and at work?