Study Shows FLSA Cases Are Up 500 Percent

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A Government Accountability Office (GAO) report recently concluded that from 1991 to 2012, FLSA litigation increased by 514 percent and over 300 percent since 2001.

GAO analyzed federal district court filings. For fiscal year, 8,148 FLSA lawsuits were filed, compared with 1,947 in 2001 and 1,327 in 1991. Private employers were the defendants in 97 percent of the cases.

Four industry categories accounted for more than half of the FLSA cases:

  • Hotels, restaurants and bars (23 percent)
  • Manufacturing (nearly 20 percent)
  • Construction
  • Other service industries (e.g., nail salons, laundry services and domestic work)

The FLSA lawsuits filed in FY 2012 included a variety of allegations, and many cases involved more than one claim. According to GAO, 95 percent of FLSA lawsuits that year included allegations of FLSA overtime violations, 32 percent alleged workers did not receive the minimum wage and 14 percent included retaliation claims under the FLSA.

At a minimum, an FLSA complaint must allege at least one of the following violations: overtime, minimum wage or retaliation. About 95 percent of the cases had an overtime issue. In addition, nearly half of the cases involved recordkeeping errors, and almost a third involved issues related to off-the-clock work. Three states accounted for more than of the FLSA litigation initiated in 2012: Alabama, Florida and New York.

What are some of the reasons for the significant increase? Explanations included:

  • Increased awareness about FLSA cases and the "fairly straightforward nature of many FLSA cases"
  • Economic conditions
  • Ambiguity in the regulations, especially as to which jobs are exempt or non-exempt

The GAO recommended that the DOL's Wage and Hour Division (WHD), the enforcement agency for the FLSA, take several actions to address this trend:

  • Develop a systematic approach for identifying areas of confusion
  • Provide more guidance "to help employers voluntarily comply with the law"

FLSA compliance is taking center stage among the various employer concerns in 2014. Attendance management is more critical now than ever before. If you do not have complete confidence in your time and attendance and overtime tracking software, please consider Infinisource's TimeForce solution. Click here to set up a demo.

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