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Wage And Hour Risks Come Large And Small For Family Employers

Actor Omar Epps and his wife recently settled a wage and hour lawsuit brought against them by their former nanny.

The plaintiff, who received a $65,000 annual salary, alleges that the couple failed to pay her overtime for all hours worked and did not give her accurate or complete pay stubs.

The nanny worked for the couple from 2007 to 2015.

The couple will pay $650 to settle the suit—$487.50 to the California Labor & Workforce Development Agency and $162.50 to the former nanny. "Omar Epps, Wife Settle Nanny's Lawsuit" mynewsla.com (May 17, 2018).


Commentary and Checklist

Although this case resulted in a small settlement award, most wage and hour lawsuits against family employers often lead to a much larger financial loss, not to mention attorney fees, time spent in litigation, and negative press.

Family employers must properly designate each employee as exempt or non-exempt from overtime. Work with your legal counsel before making this determination, which depends on job duties and salary levels, not job titles.

Pay all staff at least the federal or state minimum wage—whichever is higher—for all hours worked each week. Pay overtime eligible staff one-and-one-half their normal hourly wage for all hours worked over 40 per week.

It is not enough to pay staff accurately, they must be trained on proper and accurate timekeeping, and you must provide them with documentation of their pay. In this case, the former nanny alleged that her employer failed to provide her with complete pay stubs. Know your state law concerning how often staff must receive pay stubs and what information must be included.

Here are some additional ways family employers can prevent a wage and hour lawsuit:
 

  • Pay staff promptly and regularly.
  • Routinely review your wage and overtime policies and staff pay to make sure they are in compliance with the Fair Labor Standards Act (FLSA) and state laws.
  • If in doubt, remember that government regulators tend to take the position that staff members are eligible for overtime unless you prove otherwise.
  • Closely examine the salary and job duties of staff to determine his or her status. Do not rely solely on job descriptions.
  • When in doubt, seek the advice of an attorney when making wage classifications for your staff.
  • Encourage staff to talk with a manager if they feel they were not fairly compensated for hours worked, rather than let misunderstandings fester.
  • Immediately address any wage and hour grievances raised by staff.
  • Routinely monitor federal and state wage and hour laws so that you are prepared for any changes in the law.
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