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Wage and hour complaints skyrocket past an already record high

According to research by a national, employer-side law firm, wage and hour litigation is still on the rise. As we discussed on this blog in August of last year, the number of Fair Labor Standards Act cases brought by workers reached a 20-year high as early as March 2012, and it appears they continue to skyrocket this year despite some indications they had reached their peak.

So far in 2013, 7,764 wage and hour cases have been filed in federal courts under the FLSA, according the Federal Judicial Center, which provides research on the judiciary to the federal government. At the same time last year, 7,064 such cases had been filed, a record at that time, so this year’s number is up by 10 percent.

According to the firm that performed the research, the most common cases involved employee misclassification — companies labeling employees as independent contractors or paying a salary with no overtime to workers who should be hourly. Claims of employers expecting workers to perform uncompensated work “off the clock” were also common.

The number of FLSA disputes only rose about 1 percent between 2011 and 2012, so employers were under the impression that the number of wage and hour claims was stabilizing and might even decline. The 10 percent increase this year apparently took them by surprise. it’s surprising to see a sharp increase like this,” confirmed a spokesperson for the national firm.

What to employers think is causing so many workers to sue over unpaid overtime, off-the-clock work or other FLSA violations? Here are three reasons the law firm provided, none of which, you may note, has anything to do with unlawful practices by employers:

A better economy encourages workers to take the risk of complaining, especially when unsophisticated companies have become more profitable — and therefore more attractive targets for lawsuits. A better job market also gives employees the courage to demand more from their employers.

Large verdicts and settlements encourage law firms to file claims they might not have considered in the past, even if they practice wage and hour law.

The advance of the Internet and social media have provided more workers with information about their rights, encouraging them to challenge practices they perceive to be illegal.

If you assume that there will always be FLSA violators among employers and that nothing can be done to dissuade them, perhaps it’s true that employees are filing more complaints now that they’re in a better position to do so. Of course, the trend might mean that more companies have been swindling their workers out of their rightful wages and overtime.

Source: Insurance Journal, “Wage and Hour Claims Among Top Threats to U.S. Employers,” May 21, 2013