Let me be the millionth person to say that we are living in unprecedented times.
Well, unless you count the Spanish Flu, which few of us probably dealt with as that was more than a century ago.
And, not incidentally, few if any of the wage-hour laws employers deal with today were in place back then.
As employers navigate issues that they never imagined, there are more than a few myths circulating about wage-hour laws that are worth mentioning here – and worth debunking.
Myth No. 1: “Employees Won’t Sue Over Alleged Wage-Hour Violations Occurring During The COVID-19 Crisis”
The thinking behind this myth is that employees will recognize that these indeed are unprecedented times, that they understand employers are going through difficult times and having to address unusual issues swiftly, that they are grateful to have jobs during this time, and that they will cut those employers slack in recognition of those facts if employers don’t comply in full with wage-hour laws.
While it’s nice to think that the COVID-19 crisis will remind everyone of what is truly important in life and engender more understanding and good will, the idea that employees and their lawyers will refrain from filing wage-hour claims is baseless.
First, filing suits is how plaintiffs’ lawyers make their money – and some of them make lots of it. They aren’t going to stop working. In fact, they are highly incentivized to try to identify employers’ missteps and to try to recover as much as possible when they do.
Second, all indications are that employment lawsuits in general have continued to be filed at the same rate the past several months as beforehand. In some jurisdictions, they have increased during the crisis. That means that employees and their lawyers are not turning a blind eye toward perceived unlawful conduct.
Third, it’s not as if wage-hour laws have been suspended during the pandemic. Have you seen an amendment suspending operation of the Fair Labor Standards Act (“FLSA”) in the past few weeks? Me neither.
Trust me, if the FLSA or state or local wage-hour laws are ever suspended, we will post something about it on this blog immediately.
But it won’t happen.
Myth No. 2: “Compliance With Wage-Hour Laws Is Not Required Under The Doctrine Of Force Majeure”
The thinking behind this myth is that unexpected developments sometimes allow people and companies to avoid their legal obligations. Earthquakes, tornadoes, hurricanes, fires and other disasters sometimes allow you to avoid legal obligations, right? If you hire someone to paint your house and your house burns to the ground the day before the painter shows up, you don’t need to pay the painter, right?
That’s the doctrine of force majeure.
And while the doctrine of force majeure is alive and well with regard to contracts that are impacted by unexpected developments https://www.workforcebulletin.com/2020/03/31/you-are-excused-force-majeure-and-the-workplace-in-the-covid-19-era/, there is no similar concept built into wage-hour legislation. In other words, while force majeure might allow a company to escape contractual obligations, even those in an employment contract, where it will no longer get the benefits it contracted for, there is nothing in wage-hour laws that would allow employers to pay employees less than the minimum wage, or not pay them overtime at the overtime rate, or not pay them for all time worked, because this crisis was unexpected.
Wage-hour laws have not been amended during this crisis. Employees must still be paid at least the applicable minimum wage for their work. Employees must still be paid for overtime at the applicable overtime rate.
And if anyone tells you otherwise, kindly ask them to give you a citation to a law or court case that says so. Just don’t hold your breath waiting for an answer.
Myth No. 3: “Employers Need Not Reimburse Employees For Using Their Home Computers And Smartphones While Working From Home During This Crisis”
Depending on the states where an employer has operations, this may not be a myth at all. But in those states that require employers to reimburse employees for necessary business expenses (California, for example), that obligation still holds during a crisis.
Many employers may have employees working from home for the first time – or have employees in certain job categories doing so for the first time. Even for those employees who sometimes worked from home previously, they may be doing so for much more time now and, arguably, are now incurring greater expenses as a result.
Employers would be wise to review the laws of the states in which they have operations to determine whether they must reimburse employees for expenses incurred while working from home, including home computers, Wi-Fi and smartphones, and to determine how to calculate the amount of reimbursement.
And if employers are paying some non-exempt employees the minimum wage or close to it, they would be wise to consult with counsel to determine if unreimbursed business expenses might lead to an argument that employees are now being paid less than the minimum wage.
Myth No. 4: “Employers Don’t Have To Pay Employees Working At Home For Responding To Emails And Text Messages After-Hours”
This myth is based, at least in part, on the notion that it’s no skin off employees’ noses to respond to emails and text messages at odd hours because they’re home anyway. What’s a few minutes here or there?
For many non-exempt employees, not only are they working from home for the first time, but it is also the first time that they have had after-hours access to company emails — or received text messages or calls outside of their typical business hours.
Another way of saying this is that it is the first time that many employers have given some employees such access. Where an employer previously might have felt comfortable that its non-exempt employees no longer did any work after they punched out at the end of the day, that may no longer be the case.
Emailing, texting or calling a non-exempt employee after hours can create additional compensable time, perhaps even at an overtime rate. Yes, it is possible that such time could be de minimis and perhaps not compensable. But it’s also possible that the time could be both significant and entirely compensable, particularly if many non-exempt employees are suddenly spending time responding to emails, texts or calls outside their typical business day. It’s not too difficult to imagine a wave of class actions alleging that these employees were not paid for all of their time worked.
Employers should give thought to whether this issue could be addressed by implementing policies instructing employees not to email, test or call after hours – or shutting down access to certain systems at the end of non-exempt employees’ scheduled hours. And they would be wise to consider instructing managerial employees to wait until the start of the next business day before sending after-hours emails and texts if it can be avoided.
Myth No. 5: “Pending Wage-Hour Litigation Has Come To A Standstill During The Crisis”
This myth is based on the belief that, with many courts closed or operating at reduced capacity, pending wage-hour litigation cannot proceed; the cases are dormant.
That isn’t true.
Previously filed wage-hour lawsuits, including class and collective actions, in fact are still proceeding. Perhaps differently than before, perhaps more slowly, but they are proceeding.
Yes, many hearing dates are being postponed, and perhaps some courts have stayed particular cases.
And, yes, in many cases the parties and their attorneys have agreed to push out depositions and extend deadlines. But those cases are still very much alive, and thinking otherwise could be very dangerous. How employers address wage-hour issues during this time could have a great impact on pending litigation challenging their wage-hour practices.
Myth No. 6: “The Department of Labor Is Closed During The Crisis”
No, it isn’t. It’s open, and it’s regularly providing information to employers related to COVID-19. https://www.dol.gov/coronavirus
Myth No. 7: “If An Employer Can’t Pay Its Employees During The Crisis, It Can Just File For Bankruptcy”
Maybe, maybe not. A bankruptcy lawyer could address that.
But even if an employer could file for bankruptcy, that doesn’t mean that the owners of the company couldn’t be sued personally for any unpaid wages. Or executives or even managers.