Wage violations, wage and hour violations, or wage theft are all terms that generally refer to the same thing: an employer not properly paying an employee. Most wage violations occur due to ignorance of the law, not malice. While that isn’t an excuse, it’s certainly fixable.
If you’re an employee that wants to know more about their rights or an employer who doesn’t want to get caught in a sticky legal situation, this article is for you. Let’s take a close look at the most common types of wage violations in the workplace, so you can either identify or avoid them.
When an employee makes different pay for different tasks, overtime miscalculations can occur. While state laws vary, an employee should receive 1.5 times the amount of their hourly wage for exceeding 8 hours and 2 times their hourly wage for exceeding 12 hours.
Additionally, employers cannot average the hours worked during the pay period to calculate overtime pay. Say a person who typically works 40 hours a week has to work overtime. If said employee works 60 hours the first week of a pay period and 20 hours the second week, it averages to 40 hours per week during the pay period. Some employers make the mistake of thinking this doesn’t count as overtime, but it does. The overtime system works on a week-by-week basis.
Certain employees are exempt from overtime pay due to their classifications. These exemptions are where things can get a little tricky for employers, as there is some obscurity concerning salaried employees.
Many employees and employers alike assume that all salaried employees are exempt from overtime pay, but that isn’t always true. It’s important to look into the pay standards and regulations for all employee classifications if employers want to avoid unpaid overtime claims.
For many employees, it is up to them to get what they need for their job. The resulting expenses are business expenses. Business expenses can include travel costs, tools, supplies, and continued education or training. Under the Fair Labor Standards Act (FLSA), employers don’t have to pay their employees reimbursement for business expenses.
However, if the business expenses incurred cause the employee’s earnings to dip below minimum wage, then, under federal law, the employer must reimburse the employee for these work-related expenses. Regardless, it is wise for employers to have a clearly defined reimbursement policy and an accessible system for employees to request reimbursement for business expenses.
If an employer fails to pay an employee any agreed-upon wages—such as regular wages, overtime, or commissions—it would be considered wage theft. It is an employee’s right to receive pay for their labor. Therefore, in most cases, paycheck deferments are illegal, even if an employee agrees to them.
While some situations may be accidental, it should be a cause for concern if your employer consistently “forgets” to pay you or has issues with check bouncing. Even if an employee quits or is terminated, it is their right to receive earned wages and payment for unused vacation days.
The minimum wage varies from state to state, and it is up to the employer to pay that minimum hourly wage. If an employee is eligible for tips, an employer can pay less than this standard. However, this is only the case if the tips add up to minimum wage once factored in.
If for any reason, an employee does not receive the minimum wage and the correct payment for the hours they worked, the employee is entitled to damages. This includes wages lost, attorney fees, and other punitive damages if the case is severe enough.
There are very few situations in which an employer can legally deduct from an employee’s wages. An employer cannot take gratuity or business expenses out of any employee’s wages. Additionally, if an employer lends an employee money outside of work, they cannot deduct the money owed from the employee’s wages.
Employees should keep in mind that a smaller paycheck doesn’t always mean their employer is stealing from them. Legally, an employer can deduct or withhold pay for retirement, insurance policies, social security, Medicare, state income, and federal income taxes.
There are specific laws that also vary from state to state regarding tip-pooling policies. For example, in Massachusetts, Florida, and California, tip pooling is allowed, but only among serving staff and not with management or owners. However, in other states, it’s illegal for employers to mandate tip pooling. If employees want to pool tips, it’s something they must agree to without the influence of their employer.
Laws surrounding paid sick leave vary from state to state, but there is currently no federal law that requires private employers to give paid sick leave. However, employees have coverage under the Family and Medical Leave Act, and more states are protecting their employees from going to work ill.
What this means is that employees can take unpaid time off and return to their positions without punishment. This also means that in states where paid sick leave is mandatory, such as California, not being able to accrue or use sick leave is considered wage theft.
While there are also no federal laws surrounding meal breaks and rest periods, businesses that do employ this policy must adhere to it. Under federal law, these breaks are considered compensable work hours included in the workweek and help determine if an employee worked overtime. If any employer violates this policy, they are violating their employees’ contracts. Even if an employee opts out of taking their lunch break, if the policy is in place, the employee must offer it.
While these are some of the most common types of wage violations, this certainly isn’t an exhaustive list. If you believe you’ve been a victim of wage theft for any reason listed or not listed here, it’s time to contact The Law Firm of Tamara N. Holder. We can get you in contact with one of our wage discrimination lawyers who specializes in the field and is intimately familiar with wage theft and wage discrimination laws.