The new administration has ended the PAID Program per their press release.
The PAID program allowed employers to self-report wage and hour violations to the FLSA and pay 100% of the owed wages (could be a payroll error, employee misclassification, etc.) and in turn be immunized from private lawsuits by individual employees and not have to pay assessed liquidized damages or penalties. Here is what the DOL said in the press release:
- “Workers are entitled to every penny they have earned.”
- “The Payroll Audit Independent Determination program deprived workers of their rights and put employers that play by the rules at a disadvantage. The U.S. Department of Labor will rigorously enforce the law, and we will use all the enforcement tools we have available.”
What does this mean for employers?
- Audit your pay practices.
- Confirm that employees are properly classified as exempt versus non-exempt (or employee versus independent contractor).
- Ensure that non-exempt employees receive minimum wage and properly-calculated overtime when they work more than 40 hours in a workweek.
DOL Increases Civil Penalty Amounts for 2021
The Department of Labor (DOL) has released its 2021 inflation-adjusted civil monetary penalties that may be assessed on employers for violations of a wide range of federal laws, including:
• The Fair Labor Standards Act (FLSA);
• The Employee Retirement Income Security Act (ERISA);
• The Family and Medical Leave Act (FMLA); and
• The Occupational Safety and Health Act (OSH Act).
To maintain their deterrent effect, the DOL is required to adjust these penalties for inflation, no later than Jan. 15 of each year. Key penalty increases include the following:
• The maximum penalty for violations of federal minimum wage or overtime requirements increases from $2,050 to $2,074 per violation.
• The maximum penalty for failing to file a Form 5500 for an employee benefit plan increases from $2,233 to $2,259 per day.
• The maximum penalty for violations of the poster requirement under the FMLA increases from $176 to $178 per offense.
Action Steps for Employers:
Employers should become familiar with the new penalty amounts and review their pay practices, benefit plan administration and safety protocols to ensure compliance with federal requirements.
Our team of experts is here to help you navigate employer requirements in this ever-changing landscape of 2021. Contact Blakeman & Associates if you need any assistance.