How Does a Wage and Hour Investigation Work?
How Does a Wage and Hour Investigation Work?

How Does a Wage and Hour Investigation Work?

The Department of Labor’s Wage and Hour Division (WHD) has been ramping up enforcement activity in an effort to ensure compliance with labor standards and protect the U.S. workforce. Because of this, industries with “vulnerable workers”—such as young, disabled or agricultural workers—may be receiving a visit from a WHD investigator. Targeted industries often include the franchising, temporary employment, independent contracting and subcontracting industries.

According to Carl Smith, WHD Deputy Regional Administrator, a typical wage and hour investigation has four stages:

# The investigator meets with you, the employer, to discuss the purpose of the investigation and to answer any questions you may have.
# The investigator takes a tour of the facility, looking for evidence of vulnerable workers and other red flags.
# Payroll and time records are reviewed to see whether you are keeping accurate records of hours worked for all employees. WHD investigators are trained to spot practices like improperly classifying employees as independent contractors and paying nonexempt employees salaries instead of hourly wages.
# The investigator chooses employees to interview, using them to cross-reference any records findings.

After he or she has collected all this information, the WHD investigator determines your compliance status and decides whether to take further action, such as subpoenas for records, search warrants or surveillance of the property and employees. If you have indeed violated any labor regulations, you may be required to pay back wages, liquidated damages and/or civil penalties. You could also be subject to training, monitoring or reporting requirements, or forbidden from participating in federal contracts in the future.

When the WHD investigator is knocking at your door, accurate payroll and time records—and quick, easy access to those records—can make the process a lot smoother. Having a system in place can help ensure your compliance with wage and hour regulations, so you will have nothing to fear from a WHD investigation. It also helps to have a trusted partner like Paycor to answer your questions along the way.

Learn more about how we can help you stay compliant and avoid costly fines from agencies like the Department of Labor: talk to a Paycor representative.

Source: American Payroll Association

More to Discover

Managing Contractor Payroll: What You’ll Need to Know

Managing Contractor Payroll: What You’ll Need to Know

As a business owner, it’s a given that you’re expected to pay your employees accurately and on time. But something almost as important is making sure you don’t pay your contract or freelance workers the same way you pay employees. Let’s clarify. Independent contractors are not classified as employees by the Internal Revenue Service (IRS), so instead of being paid through your payroll system, they’re paid separately as a business expense. When your business requires hiring both employees and independent contractors, it’s important that you understand the distinctions between the two. Why? Three letters: IRS. FLSA – How to Classify Employees and Independent Contractors The IRS looks at the business relationship your company has with a...

Case Study: FRG

Case Study: FRG

A poor implementation experience, a lack of consistent customer service and a time-consuming payroll process led FRG to find a more dependable HR & payroll partner. Now with Paycor, FRG can track critical documents for each brand and employee, receive notifications when documents are set to expire and store them within one, accessible system. Explore the case study and learn how Paycor helped FRG save 15+ hours processing payroll each pay period with a streamlined process and enhanced user experience.

Webinar: EEO Reporting Review

Webinar: EEO Reporting Review

Are you ready for the September 30, 2019, EEOC filing deadline? Don’t worry, Paycor has you covered. Join our team of experts as we review the new EEOC requirements, walk you through Paycor’s Revised EEO-1 report and provide a readiness plan for meeting the filing deadline.

Case Study: Gerber Poultry

Case Study: Gerber Poultry

Two years of repeated payroll system errors and poor customer service led Gerber Poultry to seek a new provider. Enter Paycor. Now, processing payroll is seamless and HR administrators aren’t spending time reviewing taxes and deductions. Moving to Paycor’s Onboarding solution has eliminated duplicate entry and manual processes, saving HR more than an hour per new hire. Read the case study below and learn how Paycor has given the Gerber team time back in their day to focus on what matters most—delivering excellence in quality and service for customers.