Wage and hour suits on the rise, study says

Number of cases has grown almost every year since 2000

According to a report, which has yet to be released by the Administrative Office of the U.S. Courts, the number of wage and hour lawsuits is on the rise—and this year, it has reached at 20-year high. The Administrative Office plans to release the full report later this year.

The data, which Seyfarth Shaw reported in July, shows that there were 7,064 federal wage and hour suits filed during the 12 months ending March 21. That number, the office said, has grown almost every year since 2000 when the total was fewer than 1,900.

BloombergBusinessweek talked to Seyfarth Shaw Partner Richard Alfred, who chairs the firm’s national wage and hour litigation practice. “When employees are laid off, that may be an opportunity for them to seek legal counsel either to see if there’s any basis for contesting their termination or to make sure that what they’re receiving in severance or other benefits is proper,” Alfred said.

In Seyfarth Shaw’s press release, Alfred attributes the increase to four factors:

  • The weak economy, which has resulted in layoffs
  • Outdated Fair Labor Standard Act (FLSA) and state laws, which do not address recent changes in technology
  • Lack of clarity in the existing law, which makes it difficult to categorize an employee as exempt or nonexempt
  • The potential for large payouts for plaintiffs and their lawyers

"The release of the 2012 data reinforces the fact that these FLSA claims are still gaining momentum, and that they continue to be a major, growing threat to U.S. employers," said Alfred in the firm’s press release.

Read more recent InsideCounsel articles and columns regarding wage and hour issues:

Labor: The top 5 compensable time issues that spell disaster for employers

Pharmaceutical sales reps can’t receive overtime pay under FLSA

Rite Aid will pay $20.9 million to settle overtime suit

Labor: State and federal agencies turn up heat on restaurants and contractors for wage and hour violations

Labor: When employees are eligible for multiple FLSA over time exemptions

Labor: When unpaid interns become unpaid employees

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