More than 7,000 collective actions were filed in federal court in 2011 alleging wage and hour violations, an approximately 400% increase since 2000. A collective action is a special type of class action suit that applies only to claims brought by a group of employees under the federal Fair Labor Standards Act, claiming they were not paid what they were owed because either they were misclassified as exempt from overtime or they were properly classified as non-exempt but they were not paid for some of the time they worked (for example, by being required to work off the clock without being paid.).
These are high numbers! Is it simply because employers don’t know the law or don’t care about the law? I don’t think so.
I think one of the culprits is the current economy and job market. When the job market is good, employees don’t get angry — they just leave one company and go to another.
A second reason for these suits has to go to the ambulance chasing attorneys. Just because someone has a law degree doesn’t make them ethical. Going after big companies, especially the ones with deep pockets screams “cha-ching!” for attorneys.
People shouldn’t be discriminated against or mistreated at work and employees have the right to sue when they’re mistreated. But I can’t help but wonder: where does the money come from that’s awarded to the victims? Your profit sharing? Your next salary increase? Sure many companies have EPLI but a large claim (depending on the policy variables) can cause a company to be non-renewed or not able to afford the renewal premium.
At some point, we’ll all pay for these lawsuits, somehow someway. What do you think?
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