Here’s an incentive to make sure you pay employees properly: Failing to pay minimum wage or overtime may mean a lawsuit that goes back three years. Plus, winning employees receive twice what they were owed—and their attorneys collects legal fees commensurate with their time and effort.
Recent case: Nicasui Bautista sued several former employers over unpaid minimum wages for work he had performed over three years as a farm hand. He claimed the employers withheld taxes from his paychecks, but never remitted the taxes to the government. As a result, he said, he earned less than minimum wage.
The court agreed that Bautista was due the money, going back the full three years. Then the court doubled the amount as a penalty and told the employers they would also have to pay Bautista’s legal fees. (Bautista v. Zuniga, et al., No. 4:11-CV-84, ED NC, 2012)
Final note: Think you can’t make a minimum wage or overtime mistake? Think again. You may have misclassified employees as exempt when they should be hourly. That’s trouble if you have them work more than 40 hours per week. Perhaps you engaged an intern from the local college to work for free. That’s probably illegal; interns almost always must be paid.
Lawyers are always looking for cases like these because they can be easily expanded into class-action lawsuits, representing all similarly situated employees at your company.