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Penalties increase for various labor violations

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in Office Management,Payroll Management

Tucked deep inside last year’s budget bill were provisions requiring federal agencies to adjust civil penalties; inflation adjust those penalties by Jan. 15 of every year; and to make catch-up adjustments to penalties assessed after Aug. 1, 2016, for violations that occurred after Nov. 15, 2015.

The Department of Labor (DOL) and Immigration and Customs Enforcement (ICE), but not the IRS, are covered under this law. (81 F.R. 42987, 7-1-16)

DOL violations. The DOL has issued adjustments to penalties for violations of the Fair Labor Standards Act (FLSA), the Family and Medical Leave Act (FMLA) and the Employee Retirement Income Security Act (ERISA). The following penalties apply through the end of this year:

  • FLSA: For repeated or willful failures of the FLSA’s requirement to pay minimum wages or overtime: $1,894 per offense (was $1,100)
  • FMLA: For willfully failing to post notices: $163 per offense (was $110)
  • ERISA: For failing to file Form 5500: $2,063 per day (was $1,100); for willfully failing to provide employees with a Summary of Health Benefits Coverage: $1,087 per day (was $1,000); for failing to provide employees with summary plan descriptions: $147 per request, up to $1,472 (was $110 to $1,100).

ICE violations. ICE enforces the Form I-9 rules, as well as rules regarding the employment of aliens. The following penalties apply through the end of this year:

  • Knowingly hiring, referring or recruiting unauthorized aliens: Penalties ranging from $539 for a first offense, to $21,563 for a third offense (was $375 to $16,000)
  • Form I-9 paperwork violations: Penalties ranging from $216 to $2,156 (was $110 to $1,100).

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