WHD Announces Pilot Program to Resolve Minimum Wage, Overtime Violations
Author: Robert S. Teachout, XpertHR Legal Editor
UPDATE: The Wage and Hour Division launched the PAID program on April 3, 2018. In its launch announcement, WHD reiterated that the primary objectives of the six-month pilot are to facilitate resolution of potential overtime and minimum wage violations expeditiously and without litigation, improve employer compliance and ensure more employees receive owed back wages faster. More information is available at the PAID program website.
March 8, 2018
The US Department of Labor's Wage and Hour Division (WHD) has announced a new pilot program to expedite resolution of certain minimum wage and overtime violations. Under the Payroll Audit Independent Determination (PAID) program, the WHD will resolve violations by assessing the amount of wages due and supervising the payments to employees.
The PAID program allows employers to resolve inadvertent violations of minimum wage and overtime requirements expeditiously and without litigation. Additionally, employers that participate and cooperate with the WHD to correct their compensation practices will not be assessed liquidated damages or civil monetary penalties in the final settlement.
At the same time, employees will receive 100% of the back wages owed, without having to pay any litigation expenses or attorneys' fees. They will also collect their unpaid wages faster since employers must pay all back wages due by the end of the next full pay period after receiving the WHD's summary of unpaid wages. Acceptance of the payment is voluntary, and employees do not waive any rights for accepting or not accepting payment through the PAID program.
Employers may not participate in the PAID program for practices that are currently in litigation or under investigation. The pilot program also cannot be used to repeatedly resolve the same potential violations since the purpose of the program is to identify and correct potentially noncompliant practices.
The PAID program further requires employers to:
- Review the Wage and Hour Division's compliance assistance materials;
- Carefully audit their pay practices; and
- Agree to correct the pay practices at issue going forward.
The pilot program will run nationwide for approximately six months, after which the WHD will evaluate it and consider future options. The WHD has provided FAQs about the forthcoming program.