Thursday, July 17, 2008

Wage and Hour Division Criticized

The U.S. Department of Labor’s Wage and Hour Division has failed to effectively enforce federal wage laws, according to a Government Accountability Office report issued on July 15th, 2008.

From fiscal years 1997 to 2007, the number of WHD’s enforcement actions decreased by more than a third, from approximately 47,000 in 1997 to just under 30,000 in 2007. The WHD defended the trend. It stated that it decided to enforce fewer, but more time-consuming comprehensive claims. It also states that the decrease resulted from more careful screening out of unmerited claims at the intake stage. WHD admits that part of the decrease is attributed to a 20% reduction in investigative staff.

The GAO found that the WHD rarely imposed statutory penalties on employers. WHD assessed penalties for 6 percent of the enforcement actions conducted between 2000 and 2007.

The GAO cited several examples where the WHD found violations of federal labor law, but failed to follow through with enforcement.

In one case, a homeless woman receiving free room and board while working as a night attendant at a nursing home alleged her employer had failed to pay her wages for an entire year. According to the WHD, the employer admitted it had failed to pay any wages to the night attendant and considered the room and board to be pay, but stated it did not have any money to pay the back wages. The WHD dropped the case and advised the night attendant of her right to file a private lawsuit. The employer was still in business as of June 2008.

An another case, the an employee alleged he was not paid for overtime. The WHD investigator did not perform any actions for 15 months citing a backlog of cases. Investigation was dropped after 15 months when the investigator saw a news article showing that the business in question had closed

The GAO further criticized the WHD for focusing on too narrow a range of industries. “WHD focused on the same industries from 1997 to 2007. The agency primarily targeted four industry groups: agriculture, accommodation and food services, manufacturing, and health care and social services.” The WHD did not react to information from its commissioned studies on low wage industries in which FLSA violations are likely to occur. The GAO concludes “WHD may not be addressing the needs of workers most vulnerable to FLSA violations.”

WHD’s data tracking hides its inefficiencies. “The extent to which WHD’s activities have improved FLSA compliance is unknown because WHD frequently changes both how it measures and how it reports on its performance,” reports the GAO.  “When agencies provide trend data in their performance reports, decision makers can compare current and past progress in meeting long-term goals.” WHD did just the opposite. “While WHD’s long-term goals and strategies generally remained the same from 1997 to 2007, WHD often changed how it measured its progress, keeping about 90 percent of its measures for 2 years or less.”

As quoted in the New York Times, a Labor Department press release highlighted the pay it has recovered for employees. Recovery of wages “more than doubled to $220,613,703 in 2007 from $96,719,108 in 1997.” The DOL said that 341,624 employees received back wages in 2007, up from 189,244 10 years earlier.” The DOL added: “The “Wage and Hour Division is delivering pay for workers, not a payday for trial lawyers.”

To view the GAO reports, click here and here.

To view the New York Times article, click here.

Submitted by:
Christopher W. Olmsted, Esq.
Barker Olmsted & Barnier, APLC

Thursday, May 15, 2008

Litigators Predict Lawsuits Regarding Employee Compensation For After-Hours PDA Emails

Should employees be paid for time spent after hours reviewing business-related emails on their PDAs? The question has probably not occurred to most employers. But wage and hour class actions have been built upon lesser issues.

The general rule is that non-exempt employees must be paid for all hours worked. If an employee is “suffered or permitted” to work, even though the employer has not instructed or requested that he do so, the time is compensable working time. The rule does not depend on whether the work is performed before or after regular work hours.

Plaintiff attorneys might argue that it doesn’t matter whether the employer expected the non-exempt employees to monitor after-hours emails or whether the employees did so on their own initiative. Time was spent on work-related emails and the employees should be compensated, they would argue.

Social norms play a role. Late phone calls and meetings may be seen as an intrusion, but few see sending an after-hours email as a violation of etiquette. Add to that the seemingly irresistible impulse driving some people to constantly check emails on their PDAs. The use of some devices have been jokingly compared to crack cocaine addictions.

Attorneys in various legal forums have been discussing the topic lately. The Wall Street Journal’s Law Blog recently addressed the topic here. The topic has been discussed on other internet forms, including here and here.

So far there have been no reports of wage and hour litigation involving PDAs, but it would be prudent for employers to take precautionary measures. Some commentators recommend that employers require employees to obtain permission prior to using the PDAs after hours. Others recommend giving PDAs to exempt employees only. All would agree that employers should not ignore the issue and they ought to devise an employee policy regarding the use of PDAs.

Submitted by:
Christopher W. Olmsted
Barker Olmsted & Barnier, APLC
San Diego Employment Law Attorneys

Tuesday, May 06, 2008

U.S. Department of Labor Releases New elaws Tool To Help Employers Comply With Federal Law

On May 6, 2008, the Department of Labor issued the press release below concerning a new online tool that may be useful to determine which federal laws apply to the employer. The online tool takes the user through a series of questions regarding industry, size, geographic location, and other issues. Then the guide lists particular laws which may apply to the employer, complete with links describing posting requirements and other information regarding the applicable laws.

The U.S. Department of Labor today unveiled an elaws advisor that helps employers determine which of the department’s recordkeeping, reporting and notice requirements apply to them.

The new FirstStep Recordkeeping, Reporting and Notices elaws Advisor has been integrated into a FirstStep suite of advisors that also includes the revised and expanded FirstStep Poster Advisor and FirstStep Employment Law Overview Advisor.

“These Internet tools will make it easier for small business employers to learn about and comply with the federal laws that apply to them,” said Secretary of Labor Elaine L. Chao.

The elaws advisors are free, Web-based tools designed to help employers and workers understand the department’s major employment laws. By asking a series of questions, the advisors simulate a conversation with a Department of Labor expert and guide users to customized information explaining the requirements of each law.

By asking questions such as size of business, location and type of industry through multiple choice or yes and no questions, the FirstStep Employment Law Overview Advisor determines which federal employment laws apply to each user. The advisor then provides information from the Labor Department’s Employment Law Guide on the basic provisions of these laws.

The new FirstStep Recordkeeping, Reporting and Notices Advisor summarizes the paperwork requirements for each law. The FirstStep Poster Advisor, which can be used to download and print off Labor Department posters for free, was revised to include information on where the posters must be displayed in the workplace, and what size and language requirements apply to each.

This suite of FirstStep elaws advisors is available at www.dol.gov/elaws/firststep.

The department offers more than 25 other elaws advisors covering a wide range of employment law topics, such as minimum wage and overtime, child labor, veterans’ workplace rights, health and retirement benefits, and workplace safety and health. For more information, visit www.dol.gov/elaws.

Submitted by:
Christopher W. Olmsted
Barker Olmsted & Barnier, APLC
www.barkerolmsted.com