Non-compliance with Wage-and-Hour Laws Hits Businesses Right where it Hurts

If you’re concerned about the bottom-line impacts of labor law non-compliance penalties, you’ve got good reason to be. The Wage & Hour Division of the U.S. Department of Labor (DoL) recovered more than $280 million in back wages for over 308,000 employees in fiscal year 2012, and the DoL has increased its budget for fiscal year 2014 to combat compliance-related litigation.

Clearly, not all businesses are striving to do everything they can to stay compliant. A case in point: a pizza franchise in Manhattan has just settled a wage-and-hour class action lawsuit for $1.28 million.

Stating the case

Dozens of pizza delivery workers alleged that they often worked more than 40 hours in a week, up to 65 hours in some cases, but with no additional compensation. This is a stark violation of one of the most basic obligations under the wage-and-hour laws ― that you have to pay overtime to non-exempt employees who work more than 40 hours per week.

And the franchise got more than a slap on the wrist for the infraction; the award judgments ranged from $400 to $61,300 per delivery person, depending on length of employment.

Implementing a solution

In today’s economy, few businesses can afford to be hit with such steep penalties. While scofflaws will continue to flout the system, and get caught, the good news is that the situation is completely avoidable for those striving to ensure compliance

By implementing a cloud-based time tracking solution to track non-exempt employee work hours, companies can easily ensure organizational compliance, protect employees’ wages, avoid regulatory penalties, and safeguard their bottom line.