Wage & Hour Lawsuits on the Rise in Service Industry

Across the United States, wage and hour lawsuits have been on the rise. These minimum wage lawsuits involve allegations that employers withheld pay in violation of state and federal law. Several factors have increased the frequency of these cases.

First, the economic downturn forced employers to look for ways of cutting expenses. In many cases, employers may have resorted in pushing hard enough to break the rules. It appears that some employers resorted to practices like not paying overtime and withholding tips. Paradoxically, the weak economy makes employees need their wages more, but may also make them less willing to “rock the boat,” allowing employers to get away with such practices. But other factors have been tipping the scales in favor of speaking out and seeking justice.

Second, many employees have gained a greater understanding of employment law and how to file a wage and hour lawsuit. Through electronic media, it is now much easier for employees to research their rights. For example, the U.S. Department of Justice offers smartphone apps to help employees keep track of their time and wages—independently from their employers.

Additionally, when an employee knows that a wage and hour lawsuit can pay out three times the amount that was withheld, they may be more likely to take a chance on legal action. This greater understanding of the law has empowered employees against employers who keep their wages.

Employment Law for Service Industry Employees

In addition to normal wage and hour laws, employees in the service industry have additional protections when it comes to mandatory service charges or gratuities that are placed on customer checks. A landmark service charge lawsuit helped clarify several formerly-contested issues with wage and hour laws. This case set a precedent in determining the difference between a tip and a service charge.

Prior to this, many employers charged a “service charge” and wrote it off as a tip for tax purposes. However, the court ruled that a service charge only counts as a tip if it is directly distributed to the employees, if customers can control the amount and if employers do not take any percentage of it without telling the customer. This case helped clarify issues that had dogged wage and hour lawsuits up to this point. Other cases have clarified other issues, including employers writing off withheld money as wages for tax purposes.

Get Free Legal Help

If you believe that you have been the victim of a wage and hour violation, you need to act quickly. In many states, there are statutes of limitations for wage and hour lawsuits. This means that you may have a set time limit on how long you can wait to seek legal redress. You should take the first steps as soon as you can to ensure that you get your wages.

You can start to explore your legal options by visiting the Minimum Wage Lawsuits: Service Charge, Wage & Hour Class Action Lawsuit Investigation. Here, you can enter information about your situation for a legal review by a trained expert with a background in this area of the law. The initial consultation is completely free of charge, and from it, you can receive valuable guidance on the best steps to take in your exact situation.