Benefits and Compensation

How 91,500 Pennies Landed Passive-Aggressive Employer in FLSA Hot Water

A Georgia employer recently created more than just a social media buzz with its chosen method of distributing an employee’s final paycheck.

Facts

Andreas Flaten resigned from his job at A OK Walker Autoworks in Peachtree City in November 2020. The shop owed him $915 in final wages. After having difficulty collecting the paycheck, he filed a complaint with the U.S. Department of Labor (DOL). A department representative contacted shop owner Miles Walker, who indicated he had no intention of paying the final wages.

Apparently, Walker had a change of heart. Hours after learning about Flaten’s complaint, the owner decided to pay the final paycheck of $915 in pennies. According to the complaint, the employer said: “How can you make this guy realize what a disgusting example of a human being he is… You know what? I’ve got plenty of pennies; I’ll use them.”

On March 12, 2021, Walker’s company delivered 91,500 oil-drenched pennies to Flaten’s home, dumping them on his driveway, along with an expletive written on the pay stub. Not only was the former employee required to clean the oil stain off his driveway, but to cash in the pennies, he had to scrub them, too. Walker also allegedly posted defamatory comments about Flaten.

One Thing Leads to Another

Walker’s actions prompted the DOL’s Wage and Hour Division (WHD) to conduct a broader audit of the shop’s wage and hour practices. It determined the employer failed to (1) pay overtime wages to nonexempt employees or (2) keep proper records of hours worked and pay rates.

The DOL has filed a lawsuit against the shop alleging violations of the Fair Labor Standards Act’s (FLSA) retaliation, overtime, and record keeping provisions. The suit seeks $36,971 in back wages and liquidated damages. For reference, that’s 3,697,100 pennies.

Takeaway for Employers

An employee’s complaint to a federal or state agency can put the spotlight on your company’s other employment practices. Although paying a paycheck in pennies isn’t per se (or automatically) illegal (pennies are legal tender after all), doing so can give rise to retaliation allegations depending on the employer’s motive. Better to save the antics, pay employees in the usual manner, and follow the timelines set forth by state or federal law.

Janell M. Stanton is an attorney with Felhaber Larson in Minneapolis. You can reach her at jstanton@felhaber.com.