Am I Being Exploited? Know Your Rights

Employees have rights in the workplace, and there are laws in place to protect them. However, thousands of companies are guilty of violating labor and wage laws every day. Some businesses do it intentionally, while others make mistakes. Either way, it's up to the employee to ensure their rights are not being infringed upon.

If you believe your employer is doing something illegal, it's important to first make sure you have the facts. Variables to consider include what possible illegal or unethical conduct may be involved, what laws are being violated, how many employees the company has, and in which state the employee is employed.

If you're convinced your employer is breaking the law, you should report the illegal conduct to a higher-up in the organization. If the higher-ups are involved, you should consider contacting law enforcement or consulting an employment lawyer.

Failure to pay minimum wage

Failure to pay the minimum wage is a common issue that employees face. The federal minimum wage in the United States is $7.25 per hour, but many states have higher minimum wage requirements. For example, as of December 31, 2014, the minimum wage in New York was $8.75 per hour. Minimum wage violations are particularly prevalent among tipped employees. Labor standards establish that workers who earn more than $30 per month in tips are entitled to a cash wage of no less than $2.13 per hour. While employers are allowed to factor in tips when calculating their employees' wages, they cannot deduct more than $5.12 from a tipped employee's hourly wage.

If you believe that your employer is not paying you the minimum wage, you have several options. You can try reporting the issue to a higher authority within the organization or, if that is not possible, you may need to contact law enforcement or consult an employment lawyer. In some states, you can file a complaint with the state labor agency or file a claim with the federal Labor Department's Wage and Hour Division. You may also be able to hire a private attorney to help you take civil action against your employer.

If you win a lawsuit or wage claim, you may be awarded not only the wages you should have earned but also penalties for your employer's violation of the law. These penalties can include liquidated damages, which are intended to compensate you for losses that are difficult to quantify, and waiting time penalties if your final paycheck is late or does not include all the wages you are owed. Additionally, if an employer is found liable for violating minimum wage requirements, they may be required to pay interest and civil penalties on top of the unpaid wages.

Employee misclassification

Businesses have increasingly turned to independent contractors while continuing to treat them like real employees. Companies are incentivized to do this because they don't have to pay payroll taxes, overtime pay, or offer benefits to independent contractors. However, if your employer controls when, where, and how you work, labor laws will likely consider you an employee, not a contractor, and you should be entitled to the minimum wage and overtime pay.

There are many misconceptions about employee misclassification. For example, receiving a 1099 tax form does not make you an independent contractor. What matters is whether the person receiving your services has the right to control how you perform your work. Even if you sign an independent contractor agreement, you are still an employee if, as a matter of economic reality, your work indicates that you are economically dependent on an employer.

If you believe you have been misclassified, you can report job misclassification to the Department of Labor by calling the Wage and Hour Division hotline or contacting the Department of Labor office near you.

Failure to pay for work breaks

Work breaks can be divided into two types: short breaks and meal periods. Short breaks, also known as rest breaks, are usually between 5 and 20 minutes long, while meal periods are longer, typically lasting at least 30 minutes. Federal law does not require employers to provide short breaks or meal periods. However, if an employer chooses to offer short breaks, federal law considers these as compensable work hours that must be included in the calculation of total hours worked during the workweek. This is relevant for determining if overtime pay is due to the employee.

If your employer is not paying you for work breaks, this is considered a violation of labor laws. In general, breaks of 20 minutes or less are considered compensable work time, and you should be paid for that time. If you are an hourly, non-exempt employee, you are entitled to appropriate meal and rest breaks. For each day that your employer fails to provide legally mandated meal and rest breaks, you may be entitled to an hour of pay, also known as premium wages, for each missed break.

If you believe your employer is violating labor laws by not paying you for work breaks, there are several steps you can take. Firstly, consult with an employment lawyer to understand your rights and the best course of action. You may also want to report the illegal conduct to a higher authority within the organization. If the issue is widespread and involves higher-ups, you should consider contacting law enforcement to report the illegal conduct. Additionally, you can file a claim with the appropriate state or federal agency, such as the Equal Employment Opportunity Commission (EEOC) or the National Labor Relations Board (NLRB). Alternatively, you may want to contact a private employment attorney who can take civil action against your employer.

Taking illegal deductions from wages

Illegal deductions from wages are common in workplaces and can take many forms. These include deductions for gratuities, photographs, bonds, uniforms, business expenses, and medical or physical examinations.

In the United States, the Fair Labor Standards Act (FLSA) prohibits employers from making deductions that bring an employee's wage below the federal minimum wage of $7.25 per hour. This minimum wage must also be met when factoring in tips. While employers can make deductions for uniforms and other items considered necessary for the job, they cannot reduce the employee's wage below the minimum wage or cut into overtime compensation. For example, if an employee is paid minimum wage and works 30 hours in a week, the maximum amount the employer can legally deduct from their wages is $15.

Some states have higher minimum wage requirements than the federal minimum. Additionally, certain deductions, such as those for uniforms or required tools, may be prohibited by state law.

If you believe your employer is making illegal deductions from your wages, you can file a wage claim with the Division of Labor Standards Enforcement or file a lawsuit to recover lost wages. You may also be able to claim the waiting time penalty if you no longer work for the employer.

Keeping inaccurate records

The Fair Labor Standards Act (FLSA) requires that employers keep accurate records of hours worked and wages paid, including overtime pay, for all covered employees. Employers are also required by law to notify employees of changes in pay rates and to provide advance notice of any reductions in pay. Reducing an employee's pay for discriminatory reasons is prohibited and could result in a lawsuit.

Inaccurate record-keeping can lead to financial and legal consequences, especially regarding tax laws. If an employer fails to keep records of estimated tax payments or receipts for planned deductions, they may face higher tax payments and costly penalties during an audit.

Additionally, inaccurate records can impact compliance with government regulations. For example, the Sarbanes-Oxley laws require organizations to maintain proper financial records for accounting audits to protect employees, shareholders, and the public from fraudulent accounting practices.

Inaccurate records can also make it difficult to retrieve documents, leading to a loss of organizational productivity. It increases the risk of losing important documents and can result in poor decision-making due to the difficulty in locating relevant information.

Furthermore, inaccurate records can compromise the safety and security of documents, making them vulnerable to natural disasters, information leaks, and accidental or purposeful destruction.

Overall, keeping inaccurate records can have significant negative consequences for employers, including financial losses, legal liabilities, decreased productivity, and difficulties in decision-making. Accurate and secure record-keeping is essential for maintaining a compliant and efficient business.

Frequently asked questions