Employer Defense: Employee Claims for Non-Payment of Wages

Our lawyers defend employers of all sizes against employees’ claims for non-payment of wages. We also provide defense for employers facing allegations of wage theft and other statutory offenses.

For employers, allegations of non-payment of wages can have significant ramifications. In addition to the prospect of facing civil liability, publicized allegations of withholding payment from employees can lead to significant reputational harm, and they can make it difficult for companies to both find and keep employees and customers. If employees are concerned that they might not get paid, they are not going to stick around. Likewise, if customers are concerned that a company cannot make payroll, they are going to look elsewhere for a company with greater financial stability.

But, the reality is that while some claims for non-payment of wages are valid, many are not. Some of these claims are simply misguided, and some are outright fraudulent attempts to coerce a settlement or cause harm to a company that the employee (or, as is often the case, the former employee) dislikes. Yet, in many cases, it is incumbent upon the employer to affirmatively demonstrate that the employee is not entitled to compensation, and this means that defending against claims for non-payment of wages can often prove challenging.

Employer Defense Lawyers for Non-Payment of Wages and Overtime Claims

At Oberheiden P.C., we defend employers across the country in wage-related litigation. We defend employers against wage and overtime non-payment claims under state and federal law, and we provide representation in civil court and administrative hearings. As an employer, failing to successfully defend against an employee’s non-payment claim can have implications beyond the claim itself, and we take a comprehensive approach that is designed to ensure our clients face consequences that are no greater than absolutely necessary.

Our firm is led by Nick Oberheiden, PhD, a career defense lawyer who has successfully represented numerous employers in litigation and enforcement proceedings. Dr. Oberheiden is intimately aware of the risks employers face in employment-related litigation, and he works tirelessly to secure efficient and favorable results for the firm’s clients. Dr. Oberheiden works closely with the firm’s in-house lawyers and nationwide network of affiliated attorneys to provide representation for employers facing wage-related claims across the country, and he is well-known providing clients with strategic advice that protects their legal interests while also advancing their business objectives.

Meet the employer defense lawyers at Oberheiden P.C.

Put our highly experienced team on your side

Dr. Nick Oberheiden
Dr. Nick Oberheiden

Founder

Attorney-at-Law

John W. Sellers
John W. Sellers

Former Senior Trial Attorney
U.S. Department of Justice

Local Counsel

Joanne Fine DeLena
Joanne Fine DeLena

Former Assistant U.S. Attorney

Local Counsel

Joe Brown
Joe Brown

Former U.S. Attorney & Former District Attorney

Local Trial & Defense Counsel

Amanda Marshall
Amanda Marshall

Former U.S. Attorney

Local Counsel

Aaron L. Wiley
Aaron L. Wiley

Former Federal Prosecutor

Local Counsel

Roger Bach
Roger Bach

Former Special Agent (OIG)

Michael Koslow
Michael Koslow

Former Supervisory Special Agent (FBI)

Chris Quick
Chris Quick

Former Special Agent (FBI & IRS-CI)

Kevin M. Sheridan
Kevin M. Sheridan

Former Special Agent (FBI)

Ray Yuen
Ray Yuen

Former Supervisory Special Agent (FBI)

Dennis A. Wichern
Dennis A. Wichern

Former Special Agent-in-Charge (DEA)

Understanding the Most-Common Issues in Employee Non-Payment Claims

On its face, a claim for non-payment of wages can seem fairly straightforward: If the employee worked the hours in question, then he or she is entitled to compensation for the work performed. In reality, however, many employee non-payment claims are far more complex, and executing an effective defense strategy requires an in-depth assessment of the facts involved and the various laws that apply.

For example, here are five common issues that can raise questions about the legitimacy of employees’ non-payment claims and employers’ liability for wages and overtime that are supposedly owed:

1. The Employer Correctly Calculated and Paid the Wages and/or Overtime Owed

In many cases, employers can defend against employees’ non-payment claims by demonstrating that they have paid the full amount of compensation owed. This is particularly common in cases involving claims for overtime pay under the Fair Labor Standards Act (FLSA). For employers defending against non-payment claims, thorough documentation is key, and having documentation on hand to prove that an employee was justly compensated can often bring a swift end to a claim for back pay, interest, and other damages.

2. The Employee Did Not “Work” the Hours in Question

In some circumstances, employees will claim the right to compensation for hours that they did not actually work. Not all hours spent performing job-related activities will necessarily qualify an employee for wages. Training, for example, can be provided without compensation in many cases, and employees will often have a fundamental misunderstanding of what qualifies them to receive payment.

3. Discrepancies Between Employees’ Compensation Rates are Justified

Non-payment of wages claims can also involve allegations of discriminatory compensation. For example, a female worker may claim that she was unlawfully paid less than her male counterparts—an issue which is becoming increasingly common in litigation as a result of growing awareness of the general wage disparity between male and female workers. However, while discrimination in compensation is indeed unlawful, there are many legitimate reasons why similarly-situated employees may be entitled to different wages or salaries, and employers will have strong defenses to these types of allegations in many cases.

4. The Employee is “Exempt”

Under the FLSA, employees who are “exempt” are not entitled to overtime pay if they work more than 40 hours per week, while “non-exempt” employees are entitled to overtime pay under qualifying circumstances. In some cases, defending against an employee’s non-payment claim will involve demonstrating that he or she is “exempt” under federal law.

5. The Employee’s Claim is Fraudulent, Late, or Otherwise Invalid

In addition to the types of defenses discussed above, employers can potentially assert various other defenses to employees’ non-payment claims as well. These defenses range from demonstrating that the employee’s claim is fraudulent to asserting the applicable statute of limitations. When our lawyers represent employers in employee compensation disputes, we examine all potential defenses, and we build a cohesive defense strategy that is designed to minimize our client’s liability to the fullest extent possible.

Defending Employers Against Allegations of Wage Theft

Another concern for employers accused of failing to appropriately compensate their employees is the potential for facing allegations of wage theft. Several states have adopted wage theft laws; and, while a federal wage theft bill failed to pass in 2016, there are various existing laws that prosecutors can use to bring charges against employers that intentionally withhold wages or salary from their employees. In addition to representing employers in civil litigation and administrative hearings involving employee complaints, we also serve as defense counsel for employers facing civil and criminal enforcement proceedings under state and federal law.

FAQs: Defending Against Employees’ Claims for Non-Payment of Wages and/or Overtime

As an employer, understanding your legal obligations and liability exposure in cases involving employees’ allegations of non-payment can be complicated. Here are answers to some frequently-asked questions (FAQs) from our employer defense attorneys:

Q: What is the current minimum wage for employees?

 

In some cases, employers can face allegations of failing to pay their employees the required minimum wage. While the federal minimum wage is $7.25 per hour as of 2020, more than half of the states have enacted laws that impose higher minimum wages. Currently, Washington State has the highest minimum wage ($13.50 per hour), and at least 14 other states have minimum wages that are $10 per hour or higher.

Q: When does an employee qualify as “exempt” under the Fair Labor Standards Act?

 

Generally speaking, an employee qualifies as “exempt” under the Fair Labor Standards Act if he or she receives an annual salary (as opposed to hourly or weekly wage), and if his or her job consists primarily of executive, professional, or administrative duties. As of 2020, the employee’s annual salary must also exceed $35,568 per year.

Q: When can employers compensate employees in similar roles differently?

 

In order to avoid liability for wage discrimination, an employer must have a valid business justification for providing disparate compensation to employees who are in similar roles. These justifications can range from tenure to offering performance-based incentives. When faced with allegations of wage discrimination, the key for employers is to be able to provide pre-existing documentation that demonstrates a valid justification for similarly-situated employees’ wage disparity.

Q: What are the potential consequences of a successful employee claim for non-payment of wages or overtime?

 

The remedies that are available to employees in wage and overtime non-payment cases vary depending upon the statute(s) under which an employee’s claims are filed. Generally speaking, however, potential remedies in non-payment cases include back pay, interest, statutory damages, attorneys’ fees, and court costs. In some cases (i.e. in cases involving bad-faith nonpayment of wages or overtime), employees may be eligible to seek double damages.

Q: What are the criminal penalties for wage theft?

 

When charged with criminal wage theft, employers can face penalties that are far more substantial. In addition to facing liability to the employee, an employer charged with criminal wage theft can also face liability for criminal fines and possible incarceration. Depending on the amount at issue, these fines can range from thousands to millions of dollars, and prison sentences can range anywhere from a year or less to 20 years or more.

Speak with an Employer Defense Lawyer at Oberheiden P.C. in Confidence

Has a current or former employee accused your company of failing to pay the wages and/or overtime he or she is owed? If so, our employer defense lawyers can help, and we encourage you to contact us promptly. To arrange a complimentary case assessment as soon as possible, please call 888-680-1745 or tell us how we can help online today.

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