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Wage-Related Issues Involving Your Employees

by Philip E. Goss Jr., Esq.

 

As a regular contributor to MASuccess, I derive great satisfaction from two things. One is receiving positive feedback in regard to my coverage of certain issues. The second is when someone lets me know that a problem I covered, which had previously flown under the radar, has become a hot-button issue.

On that note, I will bring up two topics that I’ve touched on and that are generating controversy in various jurisdictions: wage theft and salary inquiries. The second topic spans two issues: the ever-increasing prohibition against asking prospective employees about their previous salaries and the practice of paying similarly situated male employees more than females.

 

Wage Theft

In the past, local government entities were hesitant to become involved in employment-related issues. When it came to wage and hour issues, protection of private-sector employees was minimal at best. Previously, an employee who suffered harm because an employer violated the law typically was required to become involved in the byzantine process of filing a claim with the state or federal EEOC. Receiving relief required many steps — as is common with underfunded and overburdened government agencies. While those with meritorious cases would eventually prevail, justice delayed is justice denied.

The other option was to hire a private attorney or sue on a pro se basis, but those remedies were time consuming and not always cost efficient.

Recently, however, many local governments have enacted wage-theft statutes. Just the sound of the term “wage theft” should frighten employers because such statutes are clearly not drafted with the intent of protecting business owners.

These jurisdictions are trying to truncate the legal process. Instead of having to endure a lengthy procedure, an aggrieved employee can make his or her claim — with or without an attorney — and the employer must respond. If the matter isn’t settled in a timely manner, a hearing is held and a neutral decider of fact (typically, a retired judge) renders a verdict.

A wage-theft judgment, as opposed to a legal judgment, normally requires immediate payment (pending a due-process-required appeal). Under certain circumstances, personal liability can be imposed against the owner or the facility’s managers. A successful employee likely will also recover three times the sum due, plus interest.

My default setting is that all martial arts school owners are ethical. However, any business owner operating under the assumption that he or she can “run out the clock” or that an employee in a jurisdiction where wage-theft statutes are in effect will not seek remedy under such statutes is playing with fire.

When I first discussed this legal issue in MASuccess, wage-theft statutes were relatively uncommon. Such is not the case today.

 

Salary Inquiries and Inequitable Pay

The issues surrounding the illegality of asking previous salary information when interviewing prospective employees and of paying females less than similarly qualified males are spreading like wildfire. Many states have enacted such statutes, and the reason is self-evident. Society has passed the time when men could expect to earn more because of their status as the “breadwinner” for their family — which is often not the case — or because of some perceived superiority in the workplace.

My advice is clear: Never ask prospective employees about their salary history, implicitly or explicitly.

If you believe there’s a prudent and defensible reason to have a different pay scale or schedule for similarly qualified employees, regardless of gender, you’d be wise to have a written articulation of such decisions, prepared and documented well in advance of any claims. The day may come when you’re required to defend your position in the witness box.

 


To contact attorney Philip E. Goss Jr., send an email [email protected]

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