Blogs / 2011 / June

In early May, the U.S. Department of Labor (DOL) announced the launch of its first smartphone application. The purpose? To provide employees with another way to track hours worked and wages received. The term “another” is key in that currently the app is little more than a calendar in which individuals may enter their hours and pay. Obviously, calendars that allow similar recordkeeping are already widely prevalent on smartphones. The difference here is that this calendar also includes workers’ rights information and instructions on how to file a wage violation complaint.

While it’s commendable that the federal government is making efforts to communicate employment law through popular mediums, it runs the risk of providing employees with greater access to regulations and resources that may not be fully understood. For example, the app is freely available to all, suggesting that all employees should track hours and pay, whether they are non-exempt, and thereby eligible for overtime pay under the Fair Labor Standards Act (FLSA), or not. The app is a component of a broad initiative by the DOL to enforce wage and hour laws. In addition to the app, the DOL has added over 300 investigators to probe complaints of unpaid work time, lack of overtime pay and minimum wage violations.

In 2010, there were nearly 6,800 wage and hour lawsuits filed, which reflects an increase of more than 11% from the previous year. With the introduction of the app and other DOL programs, complaints and lawsuits may be expected to continue their dramatic rise. Notably, the Wage and Hour Division has established the “Bridge to Justice” program, which directly connects individuals with employment concerns with wage and hour attorneys via a toll-free hotline. The DOL explains that this service is provided because it does not have the capacity to handle the 35,000 calls it receives annually. However, there is an inherent problem with this program in that the attorneys, as opposed to DOL staff, have a clear financial incentive to encourage employees to pursue legal action. Furthermore, it is unclear how the dozens of state and local Lawyer Referral & Information Service programs that manage this referral service identify and allow the participation of only qualified attorneys.

Employers’ best response to recent DOL activities is increased employee communications. Corporate procedures for employment-related recordkeeping and determining FLSA classifications and employee wages should be clearly documented. Additionally, employees should be encouraged to discuss possible discrepancies in hours or wages with their supervisors and follow appropriate company protocols for reporting concerns. Employers should be receptive to employee issues, and work cooperatively to resolve any inconsistencies, perceived or actual, in employment records. Finally, though it should go without saying, employers should ensure that pay practices and policies are compliant with relevant federal, state and local laws.

Priya Kapila is a consultant at CBIZ Human Capital Services. Working in CBIZ’s St. Louis office, Kapila handles various elements of compensation plan design for diverse organizations, including structuring executive compensation packages, developing performance-based incentive programs, and designing comprehensive salary systems. For more information on Priya Kapila and CBIZ Human Capital Services, please call (314) 692-2249 or visit www.cbiz.com/hr/.