Summary: The volume of wage and hour lawsuits hit a record high in 2015.
This year, the amount of lawsuits filed for workplace violations of the Fair Labor Standards Act was the most ever. Next year, the numbers are expected to explode even more.
Attorneys for employee plaintiffs say the surge reflects worker awareness of their rights and of pay inequities. Attorneys for employers say the lawsuits bring numerous challenges to conducting business.
The Federal Judicial Center reported that 8,781 FLSA violation cases were filed in 2015, an 8 percent jump from last year. Lawyers predict an increase in 2016 because of new regulations.
Richard Alfred, the chairman of Seyfarth Shaw’s wage and hour litigation division, said, “New federal labor regulations, the fight for minimum wage hikes, and an intense focus on independent contractor classification and joint employer status create a perfect storm for new lawsuits.”
Alfred referred to the debate between classifying self-employed workers with employees. Self-employed or independent contractors manage their own schedules while employees are directly controlled by employers. The disagreement between the classification of Uber drivers is a popular example of this debate.
Alfred also referred to joint employer status. The topic gained attention this year in wage campaigns by fast food workers, particularly McDonald’s workers. The issue was whether the franchise owners were the sole employers or whether the bigger company was a co-employer.
The Washington Post threw in an additional theory as to to why the surge happened–lack of unions. Because many classes of workers do not have unions to protect them, they have to sue to protect themselves.
“When I started out in practice, nobody really heard of the Fair Labor Standards Act. Then in the 80s, and during the Clinton years, some lawsuits were brought with respect to some fairly high-earning employees. So I think this is the growth area for plaintiffs-side attorneys,” said Samuel Estreicher, director of the Center of Labor and Employment Law and New York University Law School.
Next year, experts predict that the next hot topic issue will be whether employees are correctly classified as hourly or exempt. New federal regulations regarding overtime will be issued in 2016. The regulations will focus on raising the minimum salary necessary to categorize someone as exempt from overtime.
“Failure to update the overtime regulations has left an exception to overtime eligibility originally meant for highly compensated executive, administrative and professional employees now applying to workers earning as little as $23,660 a year,” the Labor Department said on its website. “For example, a convenience store manager, fast food assistant manager or some office workers may be expected to work 50 or 60 hours a week or more, making less than the poverty level for a family of four, and not receive a dime of overtime pay.”
Source: http://www.kansascity.com/news/business/workplace/article46641705.html