Wage & hour litigation is a “hot button” issue for employers around the country. In our fifth installment video detailing the six key findings of the Workplace Class Action Report, we look at the numbers and implications behind wage & hour class action certification rulings in 2016 and discuss the FLSA regulations that impact employers in our current economy which has substantially changed since its inception in the 1930s.
As we previously discussed on our blog (here and here), and as profiled in our Workplace Class Action Report for 2017, wage & hour litigation filings decreased for the first time in over a decade in 2016. Nonetheless, wage & hour class action and collective action certification decisions outstripped all other types of certification orders over the past year. Of the 224 wage & hour certification decisions in 2016, there were 195 conditional certification rulings and 29 decertification rulings. In contrast, in 2015, there were 175 wage & hour certification decisions, including 153 conditional certification rulings and 22 decertification rulings. While plaintiffs’ lawyers won more conditional certification motions than compared to prior years, employers also won decertification motions at higher rates than as compared to 2015.
Additional factors set to coalesce in 2017 – including litigation over the new FLSA regulations and the direction of wage & hour enforcement under the Trump Administration – are apt to drive these exposures for Corporate America. To the extent that government enforcement of wage & hour laws is ratcheted down, the private plaintiffs’ bar likely will “fill the void” and again increase the number of wage & hour lawsuit filings. This is especially relevant to the extent that litigation of class actions by plaintiffs’ lawyers are viewed as an investment. Prosecution of wage & hour lawsuits is a relatively low cost investment without significant barriers to entry relative to other types of workplace class action litigation.
Because the majority of wage & hour lawsuits are collective or class actions, and because the plaintiffs’ bar has shown increasing activity with regard to this type of litigation, employers can expect wage & hour litigation to have a substantial impact on their litigation exposures in 2017 and in years to come.