FedEx and the Growing Trend of Wage Theft

When employers fail to pay minimum wage or overtime compensation to its nonexempt employees, it is considered wage theft. This misconduct is a violation of the Federal Fair Labor Standards Act (FLSA), which is a federal statute that provides protection for U.S. employees. Included in those protections is the right to be paid at least the federal minimum wage, and to be paid "time and a half" for any hours over 40 hours per week.

Filing a complaint for wage theft

While there are many employees that may be exempt from some provisions of the law, an employee covered by the FLSA who can show that they have not been paid the required federal minimum wage of $7.25 per hour can file a complaint with the Wage and Hour Division (WHD) of the U.S. Department of Labor. Under the FLSA, you also have a right to file a private action against your employer for unpaid minimum wages, unpaid overtime and liquidated damages.

High profile wage and hour lawsuits

According to state and federal officials, there has been a marked increase in wage and hour violations. There are currently several high profile wage and hour lawsuits pending. National trucking company, Schneider, allegedly failed to pay overtime to warehouse employees routinely working 70-hour work weeks, with no weekends off. McDonalds allegedly erased work hours from employees' time. FedEx drivers allege they were misclassified as "independent contractors," which prevents them from receiving overtime pay, and then were required to work 10-hour days. These are just a few examples of the various ways employers scheme to steal wages from employees.

FedEx Class Action will likely have an enormous impact

The case against FedEx has become a class action, involving over 50 lawsuits, representing more than 24,000 FedEx drivers across the country. So far, according to some reports, hundreds of millions of dollars in unpaid wages have been assessed just from the audit of 2002. The IRS intends to audit additional years as well. The impact this case could have on the company financially is unimaginable. One question presented is will this example be enough to change how companies view their employees and the violations of the FLSA. Likewise, it will be interesting to see if this case will serve as a deterrent to other companies that routinely violate the FLSA. Some believe change is not necessarily a guarantee, as many companies look at examples like FedEx and McDonalds and think those cases do not apply to their particular industry. Regardless, the misclassification of employees is definitely on the radar for many legislators, government agencies and employee/employer rights organizations.

If you feel you have not been paid properly, or if you have any questions regarding your employment rights, please contact Wrady & Michel, LLC, either online or by calling us at (205) 265-1880.

Categories: Employment Law
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