Christine Coleman

Christine S. Coleman Associate

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Department of Labor agrees to pay $7 million to settle overtime claims

Back in 2006, the American Federation of Government Employees (AFGE) Local 12 of Washington D.C. filed a grievance on behalf of its 3,000 members claiming they were not being properly compensated for overtime and “off the clock” work by their employer – The Department of Labor.

The DOL fought long and hard against paying the overtime wages the AFGE claimed its members had earned. After ten years of litigation, the DOL has finally agreed to settle the overtime claims for $7,000,000.

The DOL is the federal agency that promulgates and enforces overtime rules. It recently increased the salary requirement for exempt employees by more than double, the effects of which on businesses, non-profits, and the government sector have yet to be seen.

With news of this settlement, employers are probably feeling a mixture of gratification and terror. While feeling some schadenfreude at the news that the DOL got itself in trouble for violating its own rules is only natural, that overtime rules are so difficult to administer that even the DOL can’t get it right, should be troubling. The $7 million price tag on the DOL’s mistakes makes the news of the settlement downright disturbing; employers should take note that the FLSA is written so that overtime errors become costly mistakes, without any exceptions for employers acting in good-faith.

Beyond compensating employees for overtime, employers today and in the future must be vigilant to make sure non-exempt employees are not working off the clock by checking email or voicemail after hours. As previously exempt employees are reclassified as non-exempt in the wake of the DOL’s new overtime rule, which goes into effect later this year, employers must be prepared to guard against overtime violations.

If you need assistance in developing a plan, the St. Louis employment attorneys at McMahon Berger have been representing employers across the country in labor and employment matters for over sixty years, and are available to discuss these issues and others.  As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation as every situation must be evaluated on its own facts. The choice of a lawyer is an important decision and should not be based solely on advertisements.

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