Laboring Under Myths and Misconceptions about FLSA?

Many human resource executives, corporate legal counsel and compliance officers wrongly assume that they are in compliance with the Fair Labor Standards Act (FLSA) and state wage and hour laws.

Fact: Experts estimate that as many as 70 to 90 percent of U.S. employers are violating state and federal wage and hour statutes.

A random sample of more than 64,000 Department of Labor cases since 2008 shows that you don’t have to be a household name to be hit with an FLSA claim. From hospitals to contractors to law firms, no industry is immune either.

These are among the misconceptions and myths about FLSA dispelled in Thursday’s webinar presentation – and which I advance in my new, illustrated eBook, “How 8 Myths about FLSA Can Bust Your Budget and Blow Your Reputation” (generally available Nov. 10).

Unfortunately, too many organizations are choosing to take their chances by continuing improper pay practices and behaviors. That could be a very bad wager indeed. In my view, it’s preferable to analyze and identify the biggest problem areas and take steps to reduce ongoing liability and comply with present legal standards.

That’s the sensible approach that Joseph M. Freeman, Esq., Assistant General Counsel at Cox Communications will present at this week’s webinar.

Perhaps the greatest and most unrecognized challenge of wage and hour compliance is changing deeply ingrained workplace practices. Several working generations of managers and employees have worked through lunch, off the clock or even overtime – without recognizing that these practices are legally risky in many cases. Getting employees to change won’t be easy. Many were satisfied or comfortable or blissfully ignorant with these workplace practices.

But that is increasingly changing as viewers are swamped by lawyers’ wage and hour TV commercials and the U.S. Department of Labor’s own “We can help” public service announcements. It could be that growing public awareness of wage and hour claims may even trigger more lawsuits and bigger settlements.

The problem can’t just be resolved by sending out a new policy email or getting everyone to acknowledge the change or a legalistic training session. After all, in the press of daily work, it’s all too easy for risky practices to resurface. If this happens, new pockets of FLSA liability will reemerge. Instead, all managers and employees need to be educated on the new practices – and new behaviors strictly enforced.

Certainly, lawyers won’t stop suing, nor will wage and hour laws likely change — at least not in employers’ favor. To stop the clock on wage and hour liability, employers will need to face facts, address legal risks and implement wage and hour training. Otherwise, they will continue to risk multimillion-dollar payouts and public relations disasters.

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