This year, your organization is more likely than ever to land on the wrong end of a wage and hour lawsuit.
Fair Labor Standards Act lawsuits and investigations are exploding as lawyers hunt for new classes of plaintiffs and the federal government steps up enforcement. In 2010, the highest-profile settlements included Staples Inc. ($42 million), Wal-Mart Stores Inc. (between $43 million and $86 million) and RGIS ($27 million). For employers, wage and hour claims remain the biggest employment legal risk, and we can expect to see even bigger cases brought and claims spread to new sectors such as professional organizations this year.
Employers are in a bind: If they try to fix the problem, it may stir up more cases while increasing costs for unpaid work based on long-standing, customary practices taken for granted by employers and employees alike. If they ignore the problem, liability will mount along with the increased likelihood of detection, prosecution and greater expense.
Employers wanting to fix long-standing pockets of risk must first change their day-to-day business practices, implement FLSA training programs and make sure they don’t recur.
It’s not enough to implement new time-keeping systems, issue policies and install new business processes. Employees may still lapse into familiar and comfortable patterns of working re-creating new pockets of liability.
The training programs can help employers educate their managerial and employee staffs on basic wage and hour requirements as they apply to their daily work.
Based on what we’ve learned during the past 25 years of working with our clients, wage and hour training programs, like all workplace training, should be readily adapted and customized to the specific needs of the organization, using a simple and clear behavioral model so that managers and employees understand and know how to apply their responsibilities under applicable laws.
In my view, wage and hour learning must matter: It must change day-to-day behavior. Learning must be simple: It must be easy to remember and apply in the workplace. And FLSA learning must stick: It must be continually reinforced and refreshed to make sure learning impacts daily workplace practices.
I emphasize that the overall goal of your FLSA training program should be to make sure that wage and hour violations don’t occur or recur, while allowing your organization to demonstrate and document its commitment to proper practices.
The FLSA is confusing and complex. The good news is you don’t need to know all its ins and outs to ensure compliance. You do need awareness of workplace behaviors and the tools to change them.
Stephen Paskoff is president and CEO of Atlanta-based ELI Inc., a provider of ethics and compliance learning solutions. He can be contacted at info@eliinc.com. Paskoff also has created a three-minute video on the subject.
