Wage Laws: What Are They?
The laws of the United States, as well as most states, provide that an employee is entitled to receive the wages that have been promised to him/her for work performed. Federal law, as established by the Fair Labor Standards Act (the FLSA), protects a worker’s right to be paid and allows him/her to bring an action to enforce that right.
The New Jersey Wage and Hour Law, and similar state laws, protects employees further and makes it illegal for an employer to discriminate against an employee who files a wage claim. This means that an employer cannot fire, suspend, harass, or treat an employee adversely in any way simply because he/she made a complaint about wages or actually went ahead and filed a lawsuit to collect unpaid wages or overtime pay .
The failure to pay wages has become so widespread in this country that the United States Department of Labor, Wage and Hour Division, even has a policy statement on paying employees. The policy statement sets forth the following rule: "each workweek stands on its own, independent of other workweeks . . . [and therefore] hours worked in one workweek cannot be averaged with hours worked in another workweek for overtime payment purposes." 29 U.S.C. § 778.104 If an employee has not been paid just wages by his or her employer, the employee should contact an experienced employment law attorney to discuss the issue.
How to Identify Wage Violations
When a company has failed to pay you or another employee for the work you did, it is important to understand the different types of unpaid wages that could lead to a claim for unpaid wages. A first type of wage violation commonly seen in unpaid wages cases is the violation of a state or federal minimum wage law. For instance, if you aren’t earning at least minimum wage for the hours you work, this lack of payment can subject your employer to an unpaid wages lawsuit.
Another common scenario underpinning an unpaid wages claim is the non-payment of overtime. In simplest terms, if you are not being compensated for every hour that you work over 40 hours in a week, your employer may be violating an overtime law. Like minimum wage, a failure to pay proper overtime can violate both federal law and/or the law of your state.
Finally, there are many employees who have been wrongly classified by their employer and are currently being paid incorrectly. For example, employees who are misclassified as independent contractors and exempt employees may be owed unpaid wages. However, just because someone is paid on a salary basis and designed as exempt does mean that they are in fact exempt under applicable state or federal law.
Keeping Records of Unpaid Wages
A critical component of a claim filed against an employer for unpaid wages is the documentation of your hours worked. Having meticulous records showing the times you started and ended work, along with the amount of time you took for breaks and for meals, is usually the key that makes the difference in the outcome of a lawsuit related to unpaid wages. Paystubs are very important as well and can sometimes be even more important than hours worked. This is due to the fact that there are occasional employers who will change the amounts reflected on a paycheck or paystub to reflect a claim of the employee being paid in full. Here at the Law Offices of Eric A. Shore we have seen numerous cases wherein the hours worked were not reflected in proper fashion on paystubs, or paystubs altogether were given as fraudulent. The paystub will show what a company wants to be shown, not always, but too often it is fraudulent and does not accurately reflect the hours worked. The allegation of time spent on the job should also be documented. As an example, if a bell rings indicating the end of the working day and you do not leave until a number of minutes after that, that is time not represented by the employer on the paystub. Recording the time you left and returned to your place of employment is vitally important. Also, parties recording the amount of overtime worked is also critical. Under federal law, an employee is entitled to 1 ½ times their regular hourly rate for all overtime worked. Sometimes this can cause issues such as if one perceives an overtime rate to be $15 per hour but the correct overtime computation is $20 per hour, the underpayment of overtime could lead to a situation where an employer believes in good faith that it has paid its employees correctly when, in fact, it has not. We also recommend that you carefully measure the amount of time taken for your lunch, as well as the amount of break time taken each day. Credit must also be given for work performed before and after hours. Discrepancies in this area often plague employees who either are not diligent on their own behalves or who lack sufficient attention to detail. When questions arise as to whether time was spent properly on the job, having detailed records is a necessity as many times an employer cannot be believed to provide accurate records and contemporaneous information. When an employer does not correctly show payment of time worked (including overtime) the unpaid wage issue is magnified exponentially as the longer the allegation of unpaid wages is allowed to exist, the more the likelihood increases of a larger recovery being granted to the employee.
Pre-Lawsuit Steps
In most cases, a company requires an employee to exhaust certain administrative steps before the employee can sue the company in court. Most companies, for example, require an employee to contact human resources (or sometimes other company representatives) and complain about the company’s failure to pay wages. This allows the company to address the issue and to collect and review information prior to an employee commencing a lawsuit.
Ideally, an employee should make the complaint, in writing. This will prevent the company from claiming that the complaint never took place, or, if it did take place, that the employee could not have made a certain claim (i.e., that the employee complained to human resources about any type of wage deduction, and not just a claim that the employee was owed a few dollars).
It is also always a good idea to send a demand letter. A demand letter serves as a precursor to a lawsuit. In the demand letter, an employee can specify the wages that he or she believes are owed, or, at the very least, can request that the company calculate the amount of wages owed. Documenting the dispute in this manner can help to identify, narrow or resolve a dispute as well as prevent the company from raising certain defenses (e.g., the employee can prove that the company had notice of the claim).
Finally, if the company participates in a multi-employer benefit plan, such as a pension or health and welfare plan, the employee may be required to exhaust certain administrative remedies with the plan before initiating a lawsuit against the company.
How to File a Wage Claim
If a company fails to pay you the wages you have earned, there are several options available to recover payment. Whether they are wages and commissions or salary, there are several state and federal employment laws that can provide an avenue for recovery. You may be able to file a wage claim with the department of labor, a state employment commission, the state court, or then federal court.
Texas
The Texas Workforce Commission has a section of its website that details information about filing wage claims with the Texas Workforce Commission. The information provided by the Texas Workforce Commission is quite helpful, and you can begin a wage claim from the same website.
Florida
Within Florida, the Florida Department of Economic Opportunity authorizes the Florida Division of Workforce Services (covered at Fla. Stat. 446) to address wage claims. The Florida Division of Workforce Services website has information about the process. The website offers Florida wage claim forms as well as the contact information for the Florida District Office Divisions of Workforce Services. Additionally, the Florida District Office Divisions of Workforce Services offer grievance procedures (Fla. Stat. 446.091) for wage complaints. If a party believes that they may have a claim for unpaid wages, they should contact their local office for additional information. The local offices can relay the grievance procedure requirements and next steps.
In Miami, Florida for example, there is a local office at 150 N.W. 27th Avenue, Room 206, Miami, Florida 33110-1749. The telephone number is 800.352.9628. The local office can provide additional information about the grievance procedure, and help in obtaining the required forms.
Florida also allows an aggrieved employee to initiate a proceeding in Florida State Court for unpaid wages. See Fla. Stat. 448.110. A Florida Wage Claims may be brought within one (1) year for payment of wages owed. Any lawsuit in Florida State Court, by the Honorable Judge Baird’s Circuit , will be governed by both the Florida Civil Practice and Procedure Rules and the Florida Rules of Civil Procedure. Florida’s Civil Practice and Procedures Rules also provide a mechanism for a Plaintiff (aggrieved employee) to seek attorney’s fees for his/her attorney in a Florida Wage Claim Lawsuit. See Fla. Stat. 448.110.
Suing in Federal Court
If the amount at stake is sufficient to justify the filing of a Federal Lawsuit, a Plaintiff can proceed in Federal Court. The filing of a Florida Federal Lawsuit has many of the same requirements as set forth above for a Florida State Court lawsuit. In general, the intra-district office for federal lawsuits in South Florida is located in Miami. Federal Courts proceedings will be governed by the Federal Civil Procedure Rules and the Local Rules of Practice for the Southern District of Florida.
The attorneys at Wenzel Fenton Cabassa, P.A., are very experienced with both the local rules for Florida state courts as well as Federal courts. Complaints in a Florida state court and Federal court are generally similar, but there might also be required differences if the case is filed in Federal Court. A local attorney can provide additional help for any Florida employment lawsuit.
Documenting Wage Claims
Documenting wage claim complaints is important. Often a Florida Court or Federal Court will provide much needed relief if there are failed attempts at amicable resolution of the wage claim complaint. Wage claims documentation generally includes: (a) copies of the original employment agreement, or employee handbook, or employee offer letter; (b) timesheets for hours worked; (c) job descriptions; (d) any documents that the employer has prepared about the work or job position called a "job analysis"; (e) copies of prior paychecks issued by the employer; and (f) pay stubs received by the employee while employed by the company. There may also be other supporting documentation that is recommended so consultation with a local attorney will be best to determine specifically what should be included and/or considered for documentation purposes.
How Unpaid Wages Lawsuits Proceed
For those seeking to legally represent themselves, options may include small claims court and/or mediation with the employer. Bear in mind that for the vast majority of people a court-awarded judgment does not guarantee wage recovery. Often, the employer claims an inability to pay. Without aggressive moves on your part, even a judgment allowing a wage seizure has little chance of success.
Small Claims Lawsuit
Small claims lawsuits are state-run mechanisms designed to address low-dollar business disputes. They are informal, inexpensive, and held in a local court.
Generally speaking, small claims filing fees and the amount being sought are capped by state law. For example, in California claims cannot exceed $10,000 (for individuals, businesses can sue for up to $5,000) and filing fees generally do not exceed $100-$200 depending upon the location. Unlike most other types of lawsuits, plaintiffs are not required to hire attorneys. Since attorneys are (most often) not permitted to appear in small claims court, you would be representing yourself. (Remember — half the battle is stuck in your head. See below.) Cases are generally heard promptly, and when successful, can result in immediate judgment and wage seizure.
Small claim courts are usually the first place to go if you need to sue for unpaid wages, especially if your employer threatens to retaliate. During a lawsuit the employer will not be able to fire you or badger you for debts owed, etc., while the case is pending.
One caveat: small claims courts have limited jurisdiction. If you are from another state but work in a different state, you may need to sue in the other state. The states have a complicated system for determining which states’ courts have jurisdiction over other states, but in general if you regularly report to the company’s office in the other state, and it has been a place of your control, it may be appropriate jurisdiction. This is unlikely to cut-off jurisdiction in most situations, especially if the company has its main offices in California and your settlement originated in California.
Mediation
You may also be eligible to, and should consider, asking your employer if they are willing to mediate. Most courts offer free mediation for wage issues. Mediation is a voluntary process in which both parties agree to meet with a third-party mediator to attempt to reach an agreement. If you are seeking mediation in good faith, it is likely your employer will agree. It places no additional risk on the employer, and helps lower the costs of defending themselves. Mediation is less formal than court and can be very helpful in coming to an accord. The mediator is essentially an independent judge who hears each side and tries to devise a solution that both parties can accept (or not accept). Either way, a non-binding solution is recorded or a binding one is put into writing and signed.
Most likely, either because you live in another state or simply cannot afford a long and complicated legal battle, you will want to start with small claims court. However, there are many options available and it is advisable to read up on all of them before proceeding.
Potential Damages and Awards
Not every unpaid wage claim results in a lawsuit and when we do bring a wage law lawsuit, not every case results in a judgment in favor of the employee. Our labor lawyers have handled cases where an employee was found to have been paid all the wages due. In those cases, our charge is often $0.00.
If we do obtain a favorable judgment, the potential damages to our client are typically broken down into two areas of compensation: first, the wages and benefits that are due and unpaid; second, we discuss whether there are other forms of compensation that are available via the wage and hour laws.
In many cases, even where a company made a mistake when it calculated healthcare benefits or retirement plan contributions, the company does not owe the employee additional amounts under the law, even though the benefits were due. In those cases, the employee receives only wages and related payments for the hours worked and the wages that were due.
In other cases, the wage and hour laws entitle the employee to additional payments beyond the wages actually due. Such payments can include interest, penalties for erroneous "pay upon termination" payments, penalties for miscalculating overtime, a doubling of unpaid wage damages, and in some cases, legal fees.
Also, in certain types of cases, our labor lawyers might ask the judge to enter a judgment against the company that includes money for emotional distress or to punish the employer for its actions and to deter the employer and company generally from violating the state’s wage law.
We work with our client to discuss his or her circumstances and the types of damages our labor lawyers can seek on behalf of our client.
When a Lawyer is Needed for Wage Disputes
When debating whether or not to sue a company for unpaid wages some injured workers may consider whether they should hire a lawyer or not. First let’s understand that 95% of all wage and hour lawsuits are brought by former employees against their previous employers. So, if you have been a victim of wage theft and want to hold the company accountable for wages owed after the fact you probably will be suing your previous employer. Hiring an experienced employment lawyer will decrease the stress on you. Your attorney will help with all the negotiations up to the mediation, arbitration, or lawsuit. Handling this alone typically results in getting less than a lawyer would likely cause to be put on the table. Third, almost always a case is stronger with two or more people making a claim; go up against a large employer alone and you will feel all alone.
Wage theft can be complicated. You probably earned the wages due to you at different rates and each situation can be slightly different. Doing the math correctly is not always simple and that’s another reason to hire an attorney. Finally , once your case gets more complicated or reaches court then it’s critical to get a lawyer involved since this will give you the best chance of success.
When it comes to legal representation in wage theft cases the most important thing is to hire a lawyer who specializes in employment law. You want a lawyer who is going to work with you on the case and be realistic about what you can expect. There are many lawyers who will over-promise in order to get the business, but when it gets tough will be absent. Be careful selecting an employment lawyer to handle your case. Meet with the firm and see how they deal with you and others. The firm that won’t treat you right then won’t treat your case right either. Naturally, you should find a firm that is well versed in employment law and has a good track record.
The amount of legal fees and costs for employment lawyers varies by firm and case. Some firms may charge hourly rates while others may charge fees contingent upon a successful outcome. However, in most wage theft cases there is no fee while the case is pending. If you lose in a complaint or on appeal there may be a fee. All cases are different and the amount charged depends on several factors. A good employment lawyer will be straightforward about the fees.
