WAGE AND HOUR CLASS ACTIONS
CD: How would you describe the prevalence of wage and hour disputes in the US over the last 12 months or so? Do these disputes typically progress to class action and group litigation, or are they usually resolved at an earlier stage?
Boedeker: The coronavirus (COVID-19) pandemic was a huge disruptor in the labour market which affected labour and employment class actions in general, and wage and hour class actions in particular. First, we saw many layoffs, furloughs and other reductions in the workforce, then the labour market shifted to becoming increasingly advantageous for employees, and recently long-lasting inflation neutralised pay increases that workers had experienced. This combination has made employees more confident, which makes it more likely to challenge pay and other practices of their employers. Among options like threatening to leave, employees are encouraged to act on grievances about their pay by asserting class action claims. The accelerating levels of inflation have fuelled employees’ beliefs that pay raises are not keeping pace with inflation and the cost of living which may lead to the potential of an increase in class action wage and hour claims.
CD: What factors are driving wage and hour class actions in the US? What are the common reasons such lawsuits are filed?
Boedeker: Most class actions filed in relation to wage and hour issues are based on violations of the federal Fair Labor Standards Act. Being paid less than the federal minimum wage, being eligible for overtime pay but not receiving it, not getting paid for all hours worked, or being misclassified as exempt from overtime pay are just a few of the reasons for wage and hour class action lawsuits.
Jan-Mar 2023 issue
BRG