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Wage and Hour Lawsuits Settlements on the Rise

A study published by NERA Economic Consulting last year indicates that the number of settlements and lawsuits alleging wage and hour violations has been steadily increasing for the past decade. In addition, the ABA reported that in 2009, settlements in wage and hour lawsuits rose 44% in a year. The highest 10 settlements totaled $364 million in 2009, compared with $253 million in 2008.

Wage and hour violations occur when an employer does not comply with state and federal regulations regarding paying employees or giving them sufficient breaks or time off. Wage and hour settlements and awards can be substantial, depending on the facts of the case and the type of violations alleged. Some of the types of employer action that can lead to wage and hour violations include:

  • Unpaid overtime
  • Failure to Meet Minimum Wage Requirements
  • Misclassified Employees
  • Failure to Provide Pay Stubs

The increase in number of wage and hour lawsuits filed has continued to increase, and the settlements and awards have also continued to increase. For example, Wal-Mart settled 39 consolidated wage and hour class action lawsuits for $85 million. More than 3 million employees were affected by the litigation, which was regarding the retail giant’s payment and scheduling policies.

In a more recent case, two Wells-Fargo bankers sued the company alleging that they were required to work unpaid overtime hours to meet quotas. According to an article in the Charlotte Observer, such wage and hour lawsuits have increased as a result of the economic downturn. According to the same report, in the 12-month period ending last March, 7,064 wage and hour lawsuits were filed, a record high. Industry observers posit that large numbers of displaced workers are a direct cause of the trend, along with employers being less likely to take on traditional salaried employees.

Another issue related to wage and hour litigation is that of unpaid internships. Employers who offer such internships are required to comply with federal and state law that regulate unpaid internships, and can be held liable if they do not comply. You can learn more about the rules governing unpaid internship in our article here.

The law office of Makarem & Associates is comprised of skilled Los Angeles wage & hour attorneys who are committed to getting the highest possible settlement or award for their clients. When employers violate federal or state wage and hour regulations, they are liable to their employees for damages and the recovery can often be substantial. If you or your co-workers believe that your employer has violated wage and hour laws, you should have your case reviewed by an experienced wage and hour lawyer. To schedule a consultation with one of our wage and hour attorneys, call Makarem & Associates today at 310.312.0299 or email us at [email protected].