Wage, Hour, and Overtime Audits

What do wage, hour, and overtime audits encompass?

Florida employers must comply with wage and hour laws to ensure they pay their employees fairly. The Department of Labor may audit a business’s payroll records to determine if there are any violations of federal law. Florida employers must also comply with state wage and hour laws, such as the Florida Minimum Wage Act and the Florida Statutes Chapter 448. These laws govern minimum wage rates, overtime pay, and recordkeeping requirements. Employers must maintain accurate payroll records, including employee names, hours worked, and wages paid. Wage, hour, and overtime audits are designed to ensure that employees receive the pay they are entitled to under the law.

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Which laws, rules, and regulations apply to wage, hour, and overtime audits?

The Fair Labor Standards Act (FLSA) is the primary federal law that governs wage and hour standards, including minimum wage and overtime pay requirements. The FLSA also establishes recordkeeping and child labor standards. The U.S. Department of Labor’s Wage and Hour Division enforces the FLSA.

Employers must comply with state wage and hour laws in Florida, such as the Florida Minimum Wage Act. The Florida Minimum Wage Act sets the state minimum wage rate, which, as of 2024, is $13.00 per hour, with the tipped minimum wage at $8.46.

What common issues associated with wage, hour, and overtime audits lead to litigation against employers?

Wage, hour, and overtime audits ensure employers comply with state and federal wage and hour laws. These audits commonly lead to litigation due to the following legal risks:

• Misclassification of Employees: Employers may misclassify employees as exempt from overtime when entitled to overtime pay. For example, employers may classify employees as managers or independent contractors to avoid paying overtime. Misclassification can result in significant monetary damages and litigation costs.
• Unpaid Overtime: Employers must pay non-exempt employees one and a half times their regular pay rate for hours worked over 40 hours in a workweek. Failure to pay overtime can lead to lawsuits and significant damages.
• Unpaid Wages: Employers must pay employees for all hours worked, including hours worked during training, preparation, and cleanup time. Failure to pay wages can result in litigation and damages.
• Record-Keeping Violations: Employers must maintain accurate records of hours worked, wages earned, and other employment-related information. Failure to maintain accurate records can result in lawsuits and penalties.
• Failure to Provide Breaks: Under Florida law, employers must provide meal and rest breaks to non-exempt employees. Failure to give breaks can lead to litigation and damages.
• Retaliation: Employers cannot retaliate against employees who assert their rights under wage and hour laws. Retaliation can take many forms, such as termination, demotion, or adverse employment actions. Employees who experience retaliation can file a lawsuit for damages.

What are the prerequisites to file a lawsuit regarding wage, hour, and overtime audits, and what legal defenses may employers assert?

To file a lawsuit regarding wage, hour, and overtime audits in Florida, employees must meet several legal prerequisites, including:

• Exhaustion of Administrative Remedies: Employees must file a complaint with the appropriate state or federal agency before filing a lawsuit. The agency will investigate the complaint and attempt to resolve the dispute. If the agency cannot resolve the dispute, the employee may file a lawsuit.
• Timeliness: Employees must also file a lawsuit within the applicable statute of limitations. In Florida, the statute of limitations for wage and hour claims is generally two years from the date the claim accrued.

Employers may assert several affirmative legal defenses against claims arising from wage, hour, and overtime audits, including:

• Exemptions: Sometimes, employees are exempt from overtime pay requirements due to their job duties, such as executive, administrative, or professional exemptions.
• Arbitration Agreements: Depending on the circumstances, an employee may need to arbitrate their claims rather than file a lawsuit in court.
• Good Faith: Employers may argue that they acted in good faith when making wage and hour decisions and should not be held liable.

To determine whether your unique situation may necessitate litigation or another form of specialized advocacy, please contact our office to set up your initial consultation.

What measures must employers take to legally comply with wage, hour, and overtime audit requirements?

To comply with wage, hour, and overtime audits in Florida, employers must take the following measures:

• Keep Accurate Records: Employers must maintain accurate records of employee work hours, wages, and any deductions from wages. This includes records of overtime worked, breaks taken, and other compensation paid to employees.
• Ensure Proper Classification of Employees: Employers must also ensure that employees are correctly classified as exempt or non-exempt under the Fair Labor Standards Act (FLSA) and Florida law. Misclassification can result in litigation and fines.
• Pay the Minimum Wage: Pay employees at least the minimum wage required by federal and Florida law. The minimum wage in Florida is currently $13 per hour and will rise to $15 soon.
• Pay Overtime: Also pay overtime to non-exempt employees who work more than 40 hours in a workweek. Overtime must be paid one and a half times the employee’s regular pay rate.
• Conduct Regular Audits: Regularly audit wage and hour practices to ensure compliance with federal and Florida law. This includes reviewing records and pay practices to identify and correct any errors or violations.

By implementing these measures, Florida employers can ensure they comply with wage, hour, and overtime audits and avoid costly litigation and fines.

Please contact our office to set up your initial consultation to see what forms of legal advocacy or intervention may be available for your unique situation.

Have more questions about employment law training, compliance, or litigation?

Crucially, this overview of wage, hour, and overtime audits does not begin to cover all the laws implicated by this issue or the factors that may compel the application of such laws. Every case is unique, and the laws can produce different outcomes depending on the individual circumstances.

Jimerson Birr attorneys guide our clients to help make informed decisions while ensuring their rights are respected and protected. Our lawyers are highly trained and experienced in the nuances of the law, so they can accurately interpret statutes and case law and holistically prepare individuals or companies for their legal endeavors. Through this intense personal investment and advocacy, our lawyers will help resolve the issue’s complicated legal problems efficiently and effectively.

Having a Jimerson Birr attorney on your side means securing a team of seasoned, multi-dimensional, cross-functional legal professionals. Whether it is a transaction, an operational issue, a regulatory challenge, or a contested legal predicament that may require court intervention, we remain tireless advocates at every step. Being a value-added law firm means putting the client at the forefront of everything we do. We use our experience to help our clients navigate even the most complex problems and come out the other side triumphant.

If you want to understand your case, the merits of your claim or defense, potential monetary awards, or the amount of exposure you face, you should speak with a qualified Jimerson Birr lawyer. Our experienced team of attorneys is here to help. Call Jimerson Birr at (904) 389-0050 or use the contact form to schedule a consultation.

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