The fair Labour Standards Act (FLSA) has enforced laws for employees’ minimum wages and overtime wages. Although exempt employees are not entitled to overtime payment, the rule of minimum wage per week is there to ensure the minimum payment is done. Just as employees are entitled to their minimum wages and overtime payments, they are also entitled to back pay under the Fair Labour Standards Act.
Back pay is applicable when an employer does not pay the minimum wage of an employee or the overtime wages as per law. In such situations, employees can receive their back pays with the help of FLSA. However, one must remember the statute of limitations FLSA has on back pays. In simpler terms, there is a deadline for claiming those wages.
What is back pay and how to receive it?
As an employer, the wages you failed to pay an employee was either their right under FLSA minimum wages or a promised increase. Back pay is the difference you are due to pay back to the employee.
There are only a few possible situations that lead to back pay. It could be because you have failed to pay the employee and promised to pay later, managers mistakes accidentally paying the wrong wages, or you might have intentionally violated the laws for personal gains. Well, eventually employees have the right to claim their back pay with FLSA provisions for recovering back pay.
What are FLSA provisions for recovering back pay?
The Fair Labor Standards Act allows many methods to recoup and recover back pay.
- Employees can reach out to The wage and Hour Division (WHD) of the U.S Department of Labor. This division would assist employees by supervising the payments for back wages.
- If the WHD determines that employers owe you money to return but refuses to do so, your next option is to approach the U.S. Secretary of Labor. The U.S. Secretary of Labor has the authority to bring a lawsuit forward to help you recover your unpaid wages and in addition to that, get the liquidated damages you are entitled to.
- Employees are also entitled to private lawsuits. They can file lawsuits to claim back pay, attorney and court fees, and also liquidated damages.
Remember if you are already paid back your unpaid wages with the help of WHD supervisions, you are no longer entitled to file a private lawsuit. Similarly, if you have already approached the U.S. Secretary of Labour, and they have filed a suit on your behalf, you no longer can file a private suit to recover your wages.
What are the statutes of limitation on back pay?
FLSA puts a time frame for your claim on back pay. This is to ensure employees are not leveraging the situation, and act upon the violation within a reasonable time. Generally, the statute of limitation is for 2 years after the violation has occurred. But if found that the company is willfully violating the FLSA laws, the statute limitation increases to 3 years.
If an employee claims back pay after 4 years, for example, his back pay would only be considered for the past 2 years as of the date of filing the claim. The prior wages that exceed the FLSA limitations will not be paid.
Final Words
Back pay amounts are not just the minimum wages, but also the increased wage promised, incentives and bonuses never paid. For employers, withholding these amounts can be more costly than staying compliant with the law.
