Wage & Hour Disputes Take Financial Toll On Businesses

The Pittsburg Post-Gazette reports that when Dick’s Sporting Goods reported fourth quarter results, the retailer with stores in 42 states explained that its profits would have been higher if not for charges related to settling class-action lawsuits over wage and hour disputes.

The company was party to an agreement filed in the U.S. District Court for the Western District of New York, that called for it to pay as much as $15 million to settle more than 20 related wage and hour class-action lawsuits, covering claims under the laws of 36 states.

The Labor Department reported in fiscal 2008 that more than 197,000 employees received a total of $140.2 million in minimum wage and overtime back wages as a result of Fair Labor Standards Act violations identified by the department’s Wage and Hour Division. Overtime violations alone accounted for nearly 88% of all back wages collected that year, which is the most recent report available.

Attorneys continue to use confusing regulations and new methods of tracking time to score huge settlements in class action suits where they are often the only winner. ◆