We frequently see law
firms advertising in the media their
availability to prosecute unpaid wage claims.
Various local firms are engaging in the practice
of pursuing claims under the Federal Labor
Standard Act of 1938. This statute confers
a cause of action to any employee who has not
been adequately compensated for hours worked in
excess of the forty-hour work week. The
law provides that any employee that has worked
an excess of forty hours a week should be
compensated at a rate of time and a half for
each hour worked in excess of the forty hours.
For example, if an employee is compensated at a
rate of $10.00 per hour, each hour that he works
in excess of the forty hours should be paid at a
rate of $15.00 per hour.
I have litigated
various cases under this statute, and I would
like to offer certain recommendations that could
be useful to any employee or employer that finds
himself/herself involved in this type of
dispute. First of all, the statute only
applies to employees and not to independent
contractors. I would like to clarify,
however, the fact that an employee is classified
as an independent contractor does not mean that,
as a matter of law, he/she is a true independent
contractor. Even if the worker has signed a
contract acknowledging that he or she is an
independent contractor, a Court could still rule
this does not preclude the Court from finding
that he/she was in reality an employee.
There are various
factors taken into consideration in determining
the employer/employee relationships. The
control by the employer is one of the most
important factors in making this determination.
If the employee provides services on a
continuous basis at the employer’s premises,
under the supervision of the employer, it is
highly likely that the Court will find that the
worker is an employee. If the said
employee works an excess of forty hours per
week, he has a right to be compensated in
accordance with the statutes and can pursue a
claim against his employer.
When faced with this
type of claim, the employer must be very careful
insofar as the statute provides for imposition
of severe penalties and for payment of
attorney’s fees incurred by the employee in
pursuing the claim. Because we are dealing
with a Federal Statute, the United States
District Court has jurisdiction to entertain
such a claim and not all attorneys practice in
this Court. In addition, the statute has
certain exemption which would apply to certain
enterprises, an example of which applies to
those businesses whose gross income does not
exceed $500,000.00 per year. Therefore,
any entrepreneur that is faced with dealing with
such a claim should seek out an attorney
experienced in this field.
In fact, it is advisable
that both parties involved in this type of
controversy seek out a professional qualified in
this type of labor issue. It is also advisable
that the parties pursue a settlement as
expeditiously as possible insofar as this type of
litigation tends to be costly. Businesses are
constantly striving to generate enough income to
maintain prosperity. Therefore, the lack of
pragmatism in dealing with this type of case could
result in a waste of monetary resources that could
be utilized to enhance the efficiency and prosperity
of a business.
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