Publications

Discounted Damages Through Fluctuating Work Week

Texas Lawyer
04.07.14

Wage and hour litigation has been on a meteoric rise and is unlikely to slow in 2014. Nationally, employers paid over $245 million in 2013 to resolve wage and hour cases. In Texas, Fair Labor Standards Act (FLSA) cases continue to be among the most commonly filed in federal courts. Many of these cases allege plaintiffs are due overtime after being misclassified as exempt employees.

Two recent rulings by the U.S. Court of Appeals for the Fifth Circuit define an employer’s ability to resolve these cases at a discount by applying the fluctuating work week (FWW) method of calculating damages. These savings can be significant — for example, with an employee who earns $45,000 annually and averages 45 hours per week, an employer can save $15,000 over the three year look-back permitted by the FLSA by applying this method — and multiply when considered in the common context of collective actions.

The FWW method is authorized by the FLSA. Where the employer and employee agree and the employee works a varying number of hours per week,  the employee receives reduced overtime pay. The employee is paid a weekly salary, which compensates the employee for all “regular” hours worked. For each hour of overtime, the employee receives the premium amount of “half-time” instead of the traditional time and a half. This method can save employers two-thirds of the potential damages in a misclassification suit. Although a circuit split exists, the Fifth Circuit routinely approves retroactive application of this method in misclassification cases.

Read More.

 

The publications contained in this site do not constitute legal advice. Legal advice can only be given with knowledge of the client's specific facts. By putting these publications on our website we do not intend to create a lawyer-client relationship with the user. Materials may not reflect the most current legal developments, verdicts or settlements. This information should in no way be taken as an indication of future results.

Search Tips:

You may use the wildcard symbol (*) as a root expander.  A search for "anti*" will find not only "anti", but also "anti-trust", "antique", etc.

Entering two terms together in a search field will behave as though an "OR" is being used.  For example, entering "Antique Motorcars" as a Client Name search will find results with either word in the Client Name.

Operators

AND and OR may be used in a search.  Note: they must be capitalized, e.g., "Project AND Finance." 

The + and - sign operators may be used.  The + sign indicates that the term immediately following is required, while the - sign indicates to omit results that contain that term. E.g., "+real -estate" says results must have "real" but not "estate".

To perform an exact phrase search, surround your search phrase with quotation marks.  For example, "Project Finance".

Searches are not case sensitive.

back to top