Examining recent DOL and EEOC class action suits can point to where wage and hour litigation is headed next. Neal Shah of Frost Brown Todd pointed to a few recent DOL and EEOC class actions that highlight important trends in wage and hour litigation.
DOL targeting low wage industries
The Department of Labor’s Wage and Hour Division (WHD) is targeting the industries it believes have the highest rate of violations – namely low-wage industries such as restaurants, construction, manufacturing, janitorial services and hotels.
$5.5M in back wages for over 1000 gas station attendants
Over 1,100 employees who work as attendants at Shell, Exxon, BP and other major gas retailers have been paid less than minimum wage and not properly compensated for overtime work. The DOL recovered $5.5 million in back wages and economic damages for the gas station attendants as a result of a multi-year enforcement initiative.
While the Wage and Hour division recovered close to $300,000 in back wages and damages for each of almost 100 employees in 2014, it is the lowest amount since the initiative began in 2010. Investigators report that some gas stations increased then number of employees to avoid overtime violations, purchased time clocks to record employee work data, and contacted the DOL for resources in educating managers about overtime and minimum wage laws. This evidence points to the Wage and Hour division initiative having real impact with employers.
$1.3M in back wages for 1200 grocery workers
In 2013 and 2014, the U.S. Department of Labor’s Wage and Hour Division’s Houston office completed 120 cases and secured $1.3 million in back wages and economic damages for grocery workers. This included cases involving off-the-clock work, unpaid training, misclassified employees, minimum wage violations and recordkeeping violations.
The DOL identified grocery store chains as a target for investigation, stating that many “employ the most vulnerable workers.” Under the FLSA, employers who violate wage and hour laws are liable for back wages and an equal amount of liquidated damages, which are paid directly to the employees.
EEOC increasing systemic investigations
The Equal Employment Opportunity Commission (EEOC) has increased its involvement in ‘systemic, class-like, enforcement’. Last year, it conduced 260 systemic investigations which lead to 78 settlements and recovery of $13 million in damages, and filed 133 merit suits. The EEOC historically has been primarily involved in single plaintiff employment disputes, but has been tempted by larger payoffs and more exposure of class based claims.
$12.7 million in back wages for Hispanic and African American sheet metal workers
In EEOC v. Local 28 of the Sheet Metal Workers’ Int’l Ass’n, the trade union for sheet metal journeypersons in New York City agreed to pay $12.7 million in damages to a group of Hispanic and African American sheet metal workers in a partial settlement of race discrimination claims.
The history of this case spanned an unusually long time period, 44 years, over which the federal district court found the trade union to have discriminated against non-white journeypersons on the basis of race on a number of occasions. In 1982 and 1983, the union was found guilty of civil contempt for disobeying court ordered steps to meet a 29 percent minority membership goal.
The settlement compensates workers for claims of work-hour disparities based on race during a 15 year period, supplementing a 2008 settlement of $6.2 million in back pay damages. The union agreed to reforms to equalize work opportunities for all union members along with other steps to end the history of discrimination.