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Amid Changes, DOL's Wage-and-Hour Division Brings in Record Amount of Unpaid Wages

Piggy bank on pile of cash
By Joseph Fawbush, Esq. on October 31, 2019 2:00 PM

The Department of Labor's Wage and Hour Division reported a record $322 million in overtime wages recovered in fiscal year 2019. That number continues the steady increase in overtime wage recovery by the DOL. In 2018, the Wage and Hour Division (WHD) recovered $304 million.

The majority came from failure to pay time-and-a-half for overtime. The DOL publishes records online of total recovery for wage and hour investigations going back to 1997. The amount of recovery isn't the only story, however, as the WHD continues to undergo significant changes.

Will the Unpaid Wage Recovery Boon Continue?

Wage and Hour Department Chief Cheryl Stanton recently reorganized the department to provide Washington more insight into its investigations and enforcement actions, as well as streamline the organization. Those changes took effect October 1. Already, the department has lost a significant portion of its workforce through attrition. The Wage and Hour Division has lost 20 percent of investigators compared to three years ago. In March, the Government Accountability Office began investigating the enforcement priorities of the Wage and Hour Division, at the behest of several Democratic members of Congress.

Nonetheless, the WHD was able to maintain its unbroken streak of increased unpaid wage recovery year over year. Stanton also indicated she was going to hire an additional 25 wage investigators. While President Trump has proposed funding cuts every year, Congress has ended up approving budget increases.

On September 24, the DOL also issued a Final Rule on the FLSA salary test threshold, which would make 1.3 million workers eligible for overtime pay.

Voluntary Repayment

Whether a slowdown in enforcement actions comes, employers do not need to wait for a DOL investigation to pay back unpaid overtime to workers. In April, 2018, the DOL's wage and hour self-reporting program took effect. So far, 74 employers have used the program to pay $4 million in wages to thousands of employees. By doing this, employers avoid penalties and could potentially end liability. However, it isn't clear that the Payroll Audit Independent Determination (PAID) program is without risk. If PAID isn't right for your company, it is still essential to ensure compliance with the FLSA.

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