When employees complain that they should be earning overtime, it’s smart to settle up quickly if it’s clear that they’re right. Reason: When you fail to properly pay overtime, the Fair Labor Standards Act () allows employees to collect twice what they should have earned. That means time-and-a-half turns into triple time.
But a federal court recently ruled that when employees settle their claims before trial, they aren’t owed the extra money.
Recent case: Ruslan Camacho sued his employer, Vertical Reality, for unpaid overtime. The company agreed and offered to settle with Camacho for $2,511.
Camacho accepted but then asked the court for another $2,511. He noted the FLSA entitles those who aren’t duly paid OT to “an additional equal amount in liquidated damages.”
Not this time, the court said. Because the parties reached a settlement, the case was closed. The employer didn’t owe him more money. (Camacho v. Vertical Reality, No. 06-10640, 11th Cir., 2006)