Federal and state laws require employers to pay the minimum wage, pay overtime, compensate employees for all hours worked, and more. Employers who violate these laws can ultimately be required to pay employees what they should have received, with interest -- and often, with penalties.
Common Fair Labor Standards Act Violations
Under the federal Fair Labor Standards Act (FLSA), employers must pay the minimum wage and overtime to nonexempt employees. They also must pay employees for all hours worked, including on-call time that the employer controls. Common FLSA violations include:
- paying less than the minimum wage, either by setting an hourly rate that's too low or by taking deductions from employee paychecks that reduce their hourly rate to below the minimum
- taking a tip credit that's too large, so the employee doesn't end up making the minimum hourly wage
- classifying employees as exempt from overtime when they are actually nonexempt
- failing to pay employees time-and-a-half for overtime hours worked
- failing to pay employees for every hour worked, including breaks during which the employee had to work, on-call time, compensable travel time, time the employee spent in required training or education, and so on, and
- requiring employees to work off the clock.
Damages for FLSA Violations
If a court finds that an employer has violated the FLSA, it can order the employer to:
- Pay retroactive wages (called back pay), equal to the difference between what the employee actually earned and what the employee would have earned had the employer followed the law, plus interest. An employee can collect up to two years' worth of back pay, or three years' worth if the employer committed a willful violation of the law.
- Pay a penalty (known as liquidated damages) equal to the entire back pay award, if the employer willfully violated the statute.
- Pay the employee's attorney fees and court costs.
California Wage and Hour Law
California law provides additional protections for workers -- and California employers must follow these rules. Among other things, California law:
- provides for a higher minimum wage ($8 rather than the $7.25 required under federal law)
- provides for daily overtime for hours worked in excess of eight per day
- prohibits employers from taking a tip credit
- prohibits employers from taking many types of deductions from employee paychecks, including for uniforms, tools, and breakage
- requires employers to give employees an unpaid 30-minute meal break if they work more than five hours; this time must be paid if the employee has to do any work during the break
- requires employers to give employees a paid ten-minute break every four hours
- requires employers to provide seating for certain employees
- requires employers to pay out accrued vacation time when an employee leaves the company for any reason, and
- requires employers to give fired or laid off employees their final paychecks immediately.
Damages for California Labor Law Violations
An employer who loses a lawsuit for violating California labor law can be required to pay damages, including but not limited to:
- an hour's pay for every day in which an employee was not allowed legally required meal or rest breaks
- the difference between what the employee earned and what the employee would have earned, had the employer followed the law, for a period of three or four years
- liquidated damages for violations of the minimum wage law
- up to 30-days' of pay as waiting time penalties for failing to pay all compensation due, on time, in the employee's final paycheck, and
- attorney fees and court costs.
