Jan 21, 2011

Expect FLSA Litigation to Increase as the DOL Teams Up with the ABA

The United States Department of Labor (“DOL”) recently announced that it initiated a program that will directly refer certain complaining individuals to the American Bar Association’s Lawyer Referral and Information Service (“LRIS”). The LRIS is a pre-existing committee that maintains a network of local attorneys, organized by practice area and expertise, used to provide tailored recommendations to individuals seeking counsel. Under the DOL program, individuals who file complaints that are not resolved by the department will be connected to the LRIS, through which they will be introduced to a local plaintiff’s attorney that specializes in litigation under the Fair Labor Standards Act (“FLSA”) and/or the Family and Medical Leave Act (“FMLA”), as applicable.

According to the DOL, the “many workers across the country” who “struggle to obtain basic employment protections” will now have “a better opportunity to seek redress,” thanks to this “unprecedented collaboration between the Wage and Hour Division and the American Bar Association.” Under the program, individuals may be referred to the LRIS at any point in the complaint process, from the initial intake interview, during investigation, after investigation or even during DOL conciliation. The DOL has indicated that it will refer any complaint that the DOL declines to pursue to the LRIS. The long-term implications of this are unknown, as the program has only been in effect since December 13, 2010, but most commentators have expressed a belief that employers could see a noticeable rise in lawsuits filed under the FLSA and FMLA. Over 40,000 complaints were filed with the DOL in 2010 alone, and only a fraction of these turned into lawsuits. Under the new program, it is likely that a much higher percentage of claims will end up in the courthouse.

Another aspect of the new program that employers should be aware of is a streamlining provision under which obtaining documents from the administrative process is made easier for claimants and their attorneys. A complainant who has received attorney referral information will also receive a form to request the most relevant documents from his or her case file. These documents include the complainant’s own statement, the Wage and Hour Division’s back wage computations for the complainant and copies of any documents the complainant provided to the Wage and Hour Investigator. The DOL “will provide these documents expeditiously.” Accordingly, employers should maintain the mindset that any document, testimony or other evidence presented to the DOL will be immediately available to the claimant to use in litigation.

Due to the institution of this new system and the likely increase in FLSA/FMLA litigation, now is a good time for employers to reevaluate compensation practices, to conduct wage and hour audits and to take other steps to ensure that they are in compliance with the often difficult to follow provisions of the laws enforced by the DOL.

If you have any questions regarding these issues, be sure to contact your employment counsel at Smith, Gambrell & Russell, LLP.

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