Your Guide to Unpaid Wages and Overtime Claims
A comprehensive guide to federal wage laws, how to identify violations, and what to do if your employer owes you money.
Federal Wage Laws: The Basics
The Fair Labor Standards Act (FLSA) establishes a federal minimum wage, requires overtime pay at one and a half times the regular rate for hours worked over 40 in a workweek, restricts child labor, and sets recordkeeping requirements. The FLSA applies to employees of enterprises with annual gross sales of at least $500,000 and to employees individually engaged in interstate commerce.
Common Wage Violations
Common forms of wage theft include paying less than minimum wage, not paying overtime, requiring off-the-clock work, automatically deducting meal breaks when employees work through them, misclassifying employees to avoid overtime, illegally deducting costs from paychecks, and failing to pay for travel time between job sites.
Exempt vs. Non-Exempt Employees
The FLSA exempts certain categories of workers from overtime. To be exempt, an employee generally must be paid on a salary basis at a rate not less than the Department of Labor threshold, and their primary duties must involve managing the enterprise, performing administrative work, or requiring advanced professional knowledge. Misclassification is one of the most common FLSA violations.
How to Calculate Overtime Pay
Overtime is calculated on a workweek basis. For each workweek over 40 hours, the employer must pay at least 1.5 times the regular rate. The regular rate includes base pay plus nondiscretionary bonuses, shift differentials, and commissions. Employers cannot average hours over multiple weeks to avoid overtime.
Independent Contractor Misclassification
Some employers misclassify workers as independent contractors to avoid paying wages and employment taxes. The determination depends on the economic reality of the working relationship, including the degree of employer control, the worker's opportunity for profit or loss, and the permanence of the relationship.
Filing a Wage Claim
You can file a complaint with the Department of Labor's Wage and Hour Division or file a private FLSA lawsuit. The statute of limitations is generally two years (three for willful violations). Successful claimants may recover unpaid wages, an equal amount in liquidated damages, and attorney's fees.
Protecting Yourself Going Forward
Keep your own records of hours worked. Save all pay stubs and review them carefully. If you notice discrepancies, raise the issue in writing. Federal law prohibits retaliation against employees who assert their FLSA rights.
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This guide is for informational purposes. For advice specific to your situation, get a free consultation with an experienced employment attorney.
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