‘Forgot’ to pay overtime? Ignorance of the law is no excuse — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
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‘Forgot’ to pay overtime? Ignorance of the law is no excuse

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in Firing,Human Resources

Want to end up paying double or more the overtime you owe? Then ignore the Fair Labor Standards Act (FLSA) and New York labor laws.

If you don’t pay what you owe in overtime—on time and accurately—you may end up paying double under the FLSA, going back three years; and 25% more than you owe, going back six years.

Recent case: Do Yea Kim worked for 167 Nail Plaza for 16 years until she was fired, allegedly because she asked to take a meal break as required by New York labor laws. She sued for unpaid overtime under both the FLSA and state law, plus wrongful termination under state law.

A jury awarded her $26,000 in unpaid overtime wages, $115,000 for lost wages due to retaliatory discharge and another $34,000 for pain and suffering. Her attorneys then asked the court to add penalties available under both state and federal laws.

The court said she was due double her unpaid overtime wages under the FLSA, going back three years because her employer had not taken “active steps” to figure out whether it had to pay overtime. Likewise, Kim was entitled to an additional 25% payment under New York law, going back six years because her employer willfully violated the law.

Almost unbelievably, one of the owners testified that she “didn’t have any mind or thought to think about overtime issues,” and assumed that whatever bonuses the employees received was good enough. That was an expensive mistake. (Kim v. 167 Nail Plaza, No. 05-CV-8560, SD NY, 2008)

Final note: Make it your business to understand the intricacies of state and federal overtime laws. You absolutely must know who is exempt, who is not and how to calculate how much overtime wages to pay.

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