Survey: Audits Up for Wage-and-Hour Violations
One in five employers has been audited at least once for violating the federal wage-and-hour law, according to a recent survey by Business and Legal Reports Inc.
|FRx Software's comprehensive training curriculum is designed to teach you the skills you need to do your job more effectively. You can choose from any array of courses and delivery methods - including virtual courses on the Web - that accommodate any learning requirement or schedule. Earn valuable CPE credits - learn more now!|
|FRx Software Home||Product Information|
|FRx Express||Product Demo|
|Webcasts||Customer Testimonial Video|
Constant internal oversight of pay practices can lower your chances of a Department of Labor (DOL) audit or an employee lawsuit, says Susan Prince, J.D., managing editor of BLR. Internal audits are especially important now, since Congress changed the overtime-exemption rules of the Fair Labor Standards Act last year.
In fact, DOL has estimated that more than half of employers have incorrectly classified employees under the law.
The BLR survey showed that 15 percent said they've been audited once; another 5 percent said they've been audited between two and five times. Seventy-nine percent said they've never been audited.
Prince advised employers to make sure that employees are properly classified, and that their job descriptions are accurate. Workers who are incorrectly classified as exempt from overtime pay can file a complaint with the Labor Department and be entitled to back wages. In fact, the Labor Department last year collected $165 million in retroactive pay from employers who violated the Fair Labor Standards Act.
Prince advises employers to pay any past overtime due to employees right away – it will be less costly in the long run than paying them through a DOL settlement procedure.
If DOL audits your workplace, here's what to expect: a DOL representative will conduct interviews at the company, make sure the required posters are hung, and possibly examine the time clocks. Up to three years of your wage and hours records may be examined.
Last, Prince tells employers to cooperate if an employee decides to file a complaint. Retaliation is prohibited by law.
Voice of the Editor
Which isn’t completely true. I mean, occasionally I drop by when I manage to sneak out of the nonstop frat party over at Going Concern, but I’m mostly a wallflower over there. I’m happy to say that I’ve been given express permission (or explicit orders, if you like) to wander over here to AccountingWEB more often.
Why is that, you might ask? My job is to replace the irreplaceable Gail Perry as Editor-in-Chief. What does that mean? I don’t really know! I think it’ll be fun getting a feel for things, throwing in my own thoughts here and there, and listening to the discussions you’re having about the accounting profession.