New Survey Says Pay Violations Rampant; DOL Stepping Up Inspections

In response to the published results of a recent survey of low-wage workers in Los Angeles, New York and Chicago, U.S. Secretary of Labor Hilda Solis announced that the Department of Labor (DOL) will be putting at least 250 more wage and hour inspectors on the ground to audit employer compensation practices.

In other words, it’s time to give your pay-related policies and practices a tune-up.

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The survey—conducted by researchers at the University of California, City University of New York, and the University of Chicago—reports that the average low-wage employee in those cities lose approximately of 15 percent of their owed income per week as a result of wage and hour violations. Specifically, the survey also found that:

  • 57 percent of the low-wage workers surveyed did not receive proper pay stubs for each pay period;
  • 26 percent reported being paid less than the minimum wage;
  • 76 percent of employees who worked overtime hours reported not being paid the correct amount of overtime wages;
  • 41 percent of the deductions made from employee wages were illegal deductions;
  • 25 percent of employees reported being made to work off the clock—and, of those, 70 percent said they weren’t paid for the time they spent working off the clock;
  • 20 percent of employees reported complaining to management or trying to start a labor union—43 percent of those who did reported experiencing some form of retaliation.
  • 50 percent of employees who reported workplace injuries to their employer claimed being subjected to some form of retaliation;

The survey noted that the majority of employees who experienced pay related violations and losses worked for small and mid-sized employers, which means that smaller employers can expect to be the focus of the DOL’s new compliance inspection efforts over the next year. As such, smart companies should plan on adding a pay practices self-audit to their year-end “to-do list” for 2009.

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