DOL confirms wage and hour investigations on the rise
Barbara-Ellen Gaffney and Micah Prude of Thompson & Knight LLP co-authored the article ‘You Better Watch Out, You Better Not Cry… Wage and Hour Investigations on the Rise‘ published on JD Supra. The article begins by pointing out a number of notable recent Department of Labor (DOL) wage and hour decisions and events:
- A DOL Wage and Hour representative warned that active industries, such as oil and gas and hospitality, may be under increased scrutiny regarding payroll practices in 2015.
- In October, the DOL published regulations raising the hourly minimum wage for work on covered federal contracts.
- In March, the DOL announced it would be cracking down on FLSA worker retaliation in the Southwest region of the US after the Wage and Hour Division saw significant increase in the number of such investigations in the last year.
An increase in wage and hour investigations will be supported by a substantial DOL budget and staffing increase in 2015. The department has exoressed that it will focus on investigating industries that are at a high risk of wage and hour violations, and will not only investigate employers about whom they receive complaints.
A number of Texas-based employers have recently paid heavy penalties as the result of DOL investigations. Shell Oil Co. and Motiva Enterprises paid $4.5M in overtime wages and Big Texan Steak Ranch was assessed $800K in minimum wage back wages and liquidated damages.
The authors explore measures that employers should take immediately, rather than waiting for an investigation to be in progress. This includes organizing employee time, payroll records and I-9 forms organized and up-to-date. Employers should confirm that employees are correctly classified as exempt or non-exempt, and ensure that they are accurately recording the work hours of non-exempt employees.
In the case of an audit, the authors suggest employers keep a detailed record of interactions with the investigator and seek legal counsel.