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FLSA Claims are on the Rise, What Does That Mean for Employers?

Increased-FSLA-LegislationYear after year, the number of wage and hour lawsuits filed under the Fair Labor Standards Act (FLSA) continues to grow. Since 2007, the number of these cases has consistently been increasing and in the last 12-months alone it has increased by nearly 5 percent. The most recent data, provided by Seyfarth Shaw LLP, shows 8,126 FLSA lawsuits filed in federal courts from April 1, 2013 to March 31, 2014, noting this as a significant increase of 237% over the past 10 years. In a recent post, HR Morning explores a few key reasons for the consistent rise in FLSA lawsuits.

Richard Alfred, a labor and employment law expert and partner at Syfarth Shaw, explored several factors that he feels could be the cause of these increases. First, he believes that FLSA itself is an old and outdated law that was originally designed for what is now a different economy, meaning it doesn’t positively serve the public the way that it used to when it was initially enacted. Alfred also notes that the wording and language included in the FSLA is very ambiguous and fails to clearly define the statute. The muddy waters have made it hard to understand and in turn have generated more litigation. Overall, Alfred believes that over the course of the last several years, state laws have provided fertile ground for litigation. He also regards the level of public awareness as a factor in increased litigation because employees are becoming more aware of their rights. Finally, we are likely to continue to see these type of lawsuits on the rise because lawyers have become more eager to represent these  cases and, according to the Syfarth blog, “have found wage-and-hour claims to be fertile ground for large fee recoveries.”

Within the past year, a few additional factors have given Alfred reason to believe that the number of FLSA claims will continue to rise. First, talk of raising the minimum wage (I’m sure you’ve heard by now, the city of Seattle just raised the minimum wage to $15) has made workers more mindful of related laws and their rights that accompany them. Also, President Obama’s Executive Order to the Department of Labor is making more employees eligible for overtime, drawing more attention to wage and hour policies.

The future of FLSA litigation is unclear at this time, but it is certain that changes will be coming soon and it’s important for employers to understand how this could affect them.

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