Wage and hour claims typically involve an assertion that a non-exempt (generally non-salaried) employee/plaintiff has been insufficiently compensated or uncompensated for time worked.  This may be because some work is alleged to have been “off the clock,” was undocumented on time records, or was mismeasured in some alternative arrangement.  Wage and hour allegations also frequently include unpaid overtime. Other wage and hour claims may involve allegations of unpaid meal and rest break penalties under state law, improperly calculated commissions, disputed bonus payments and other employer pay miscalculations.

Often, these wage and hour claims form the basis of class-action suits, leaving employers vulnerable to potential multi-million-dollar payouts of back wages and damages. This type of litigation is particularly common in retail, food-service, and the construction industries. Many companies’ liability insurance excludes coverage for wage and hour claims due to the potential for wide exposure (and expensive payouts) in these types of cases.

At Welch Consulting, we possess the knowledge, experience, and analytical capabilities to offer thorough analysis and credible testimony in a wide variety of wage and hour claims. These include:

Our labor economists can assist with wage and hour compliance needs, provide wage and hour audit services, and act as economic expert witnesses in FLSA litigation or other wage and hour litigation.

Practical Solutions Developed by Expert Economists

Our economists are retained regularly to consult on allegations brought under the Fair Labor Standards Act, as well as state-specific statutes and Department of Labor investigations. We work with client data to calculate the value of meal and rest break exceptions, including penalties, and provide estimates of potential exposure from off-the-clock work, misclassification of non-exempt employees, and record-keeping errors, in preparation for and avoidance of individual employee or class action litigation. 

Meal and Rest Break Violations

Allegations of meal break violations (i.e., that they were not made available, were available but for less than the full statutory period, were interrupted, or occurred too late in a work shift, for example) may be brought under state and sometimes federal statutes.  Alleged rest break violations—because rest break time is paid—most often involve penalty (rather than lost wage) claims due to a rest break being missed, short, or provided too late in a shift.

Meal and Rest Break Violations: Representative Engagements

The Claim: Interrupted Meal and Rest Breaks

A national delivery company retained Welch Consulting to analyze and testify about nationwide class action claims of interrupted breaks and alleged unpaid off-the-clock work.

Our Findings

Our economists integrated a complex array of timekeeping data with tracking of deliveries and pick-ups to determine how often breaks showed evidence of being interrupted. Our analysis showed that interrupted breaks were uncommon and largely concentrated among a small number of employees.

The Claim: Missed Meals and Rest Breaks Among Construction Workers

Counsel for a California construction company retained Welch Consulting in a potential missed meal and rest break class action.

Our Findings

We collected and analyzed GPS data from cement trucks, as well as data on the movement of cement drums on vehicles, to assess the frequency of missed meal and rest breaks.  Based on our analyses, empirical evidence pointed to substantially fewer missed meal and rest breaks than the Plaintiffs had claimed.

The Claim: Violations due to Auto-Deducted Meal Breaks of Medical Providers 

Welch Consulting was retained by counsel for several East Coast medical services providers whose systems for automatically deducting time for meal breaks were challenged in different class actions.

Our Findings

In each case, we examined timecard data to assess the impact of auto-deduction systems and the strength of the class certification positions.  With empirical evidence of the incidence of potential incorrect deductions—which demonstrated that a majority of situations the deductions were proper— we provided defendants with arguments that typicality and commonality conditions were not met on a class-wide basis.

The Claim: Alleged Violations in 12-Hour Shift Work 

A California hospital retained Welch Consulting to examine timecard and payroll records; our consultants were asked to determine the incidence rate of premiums paid for special (short) shifts for 12-hour workers and to examine the incidence, and value, of missed meal and rest breaks in a class-action lawsuit.

Our Findings

We analyzed timekeeping and payroll matched data to develop an understanding of payroll practices, including how those practices changed over time, to assist attorneys with liability arguments and potential exposure under various legal arguments.

Off-the-Clock Work

Non-exempt employees must be paid for all time spent performing work activities. Typically, employees enter the starting and ending times of each work segment in a workplace recording clock. When work is performed outside a common workplace, those minutes (or hours) must also be paid, whether or not starting and ending times were recorded. Off-the-clock work claims can involve the alleged performance of work activities that were unpaid, perhaps because they were not clearly assigned by supervisors, were only recorded outside of standard records, may not have been clearly work-related (such as cell phone use), or involve other activities or circumstances where unrecorded and unpaid time can arguably be claimed as work-related.

Off-the-Clock Work: Representative Engagements

The Claim: Department of Labor (DOL) Charged Unpaid Call-Center Time  

A national call center retained Welch Consulting to assist with a DOL investigation and a hybrid case (including both FLSA claims and state claims from multiple states) regarding unpaid minutes.

Our Findings

We generated exposures for the multiple class groups, applying the various statutes of limitations, opt-in/out restrictions, as well as relevant penalties and interest for each. Our analysis was the basis of a settlement agreement with the DOL and was used in mediation with plaintiffs.

The Claim: Unpaid “Boot-up” Time at a Telecommunications Company 

Welch Consulting was retained by counsel representing a national telecommunications company in a California class action involving claims of off-the-clock work and failure to pay overtime.

Our Findings

Our economists effectively combined information from computer log sign-ins and telephone usage with employees’ schedules and punch times. From these sources, our economists were able to determine how often violations occurred and estimate more calculations for economic compensatory damages.

Misclassification – Exempt / Non-Exempt Status and Contractor / Employee Status

Employees who work more than 40 hours per week federally (or 8 or 12 hours per day under some state laws) may not be paid overtime premium payments if they are classified as exempt employees. Typically, these employees will be paid on a salaried basis, work on a fixed contract basis, work on a piece-rate basis, or are covered by one or another exemption under federal or state work rules.  A misclassification claim occurs when an employee classified as exempt brings an action arguing he or she was purposely misclassified and thus should be awarded damages for non-payment of overtime premiums, denial of meal and rest breaks, etc.

Misclassification: Representative Engagements

The Claim: Grocery Store Managers Misclassified as Exempt Employees

Welch Consulting was retained by counsel for a nationwide grocery store chain facing an FLSA misclassification lawsuit in California.

Our Findings

After examining whether store managers and assistant store managers consistently worked a standard amount of time on non-exempt tasks, we provided detailed data listings to assist counsel in deposing plaintiffs and were ultimately able to show a wide variation in the amount of time management employees worked at cash registers. The analysis was used to help defeat class certification. 

The Claim: Misclassified Logistics Company Contractors

In a California class action, Welch Consulting was retained by counsel for a nationwide logistics company to compute damages stemming from a claim that contractors were actually employees and, as such, should have been reimbursed for their expenses.

Our Findings

We organized personnel, vehicle, and revenue data to assess the potential value of the claim.  Our analyses provided defendants with evidence that the purported class was correctly classified as contract employees.

The Claim: Misclassified Outside Sales Employees  

Welch Consulting was retained by attorneys representing a national pharmaceutical company in several class actions brought under the FLSA, as well as under California and New York state laws, alleging misclassification of outside sales representatives.

Our Findings

Our experts assisted in processing and combining disparate sources of data for analysis that were then used to create a statistically reliable and representative sampling of Plaintiffs, who testified in a deposition on the hours they worked and the duties they performed.

The Claim: Misclassified Exempt Insurance Representatives  

Welch Consulting was retained by attorneys representing a national insurance company in a California class action where claims of misclassification, failure to pay overtime, and violations of California’s meal break codes were made on behalf of claims representatives.

Our Findings

Our economists used the timecard records of employees after their jobs were reclassified to non-exempt in order to generate reliable estimates of hours worked during the period when the employees were classified as exempt.

“Time-Shaving” and Record-Keeping Violations

 Non-exempt employees are to be paid for all hours of work.  A claim of “time-shaving” typically involves allegations that supervisors under a company-wide policy or practice altered an employee’s time records to lower the number of hours worked in a day, week, or month, such that the employee’s total pay was less than was actually earned.  A related claim—that time-shaving reduced hours to remove overtime premium pay—is commonly observed in individual employee and class-wide litigation claims.

“Time Shaving” and Record-Keeping Violations: Representative Engagements

The Claim: Managers Illegally Reduced Paid Time by Editing Records

A national restaurant chain retained Welch Consulting to investigate claims of malicious editing of time records to avoid payment of overtime.

Our Findings

Welch Consulting’s experts created an algorithm to match the manager’s edits to the final time punches from the payroll system and determine each manager’s editing sequence for a given shift. We found that managerial edits were rare among class members and that there was statistically significant variation in the instance of managerial edits. Our findings were used to defeat class certification.

The Claim: Store Managers Illegally Reduced Work Hours

Welch Consulting was retained by a large grocery chain in the Northeast where allegations included time-shaving of overtime hours worked.

Our Findings

Welch Consulting’s experts confirmed there was no analyzable data on timecard edits, but our expert analyzed payroll records to assess how often, and in what amounts, overtime payments were made. The data showed that overtime payments occurred with regularity and in amounts which varied significantly between stores and departments.

The Claim: Restaurant Managers Illegally Shaved Time, Including Deducting Improperly for Meals not Taken

Welch Consulting was retained in a New York class action where allegations included time shaving and illegal meal payment deductions for restaurant line cooks.

Our Findings

Welch Consulting’s experts generated analysis data from hard-copy work time records and assessed potential unpaid time and the value of meal deductions. Our analyses were used to settle the case.

Incorrect Regular Rates/Overtime Premiums Paid to Non-Exempt Employees

Under federal and many state regulations, overtime hours must be paid a premium that is based not only on an employee’s hourly wage rate, but also on additional monies paid to the employees, such as non-discretionary bonuses, commissions, or awards during a relevant time period. 

Incorrect Regular Rate/Overtime Premiums: Representative Engagements

The Claim: Energy Provider Inappropriately Paid “Blended” Wage Rate

Counsel for an energy provider retained Welch Consulting to organize timecard and payroll data for union employees who were paid a blended rate for all hours worked. Employees worked four 12-hour shifts one week, then three 12-hour shifts the next, but were not paid the overtime premium for the weeks with more than 40 hours worked. The US Department of Labor claimed that these employees were owed overtime pay.

Our Findings

We computed damages given DOL regulations and existing pay practices and prepared settlement lists and databases for production. The DOL has accepted our calculations as correct.

 

The Claim: Security Services Provider Incorrectly Calculated Overtime Premiums in California

Welch Consulting was retained by counsel for a security services provider that was accused of incorrectly computing overtime payments in two California class-action lawsuits.

Our Findings

Using timecard and payroll data, one of our experts correctly calculated the overtime pay rate as well as the number of overtime hours worked. These computations of damages and penalties were used in mediation to reach a settlement.

unpaid benefits analysis

Improperly Paid Benefits

Although not measured in dollars on a pay stub, employers are required to comply with state and federal laws in providing the benefits under employment contracts. Employees who believe they have not received the full value of benefits—especially in the case of unused benefits at the time of termination—can bring a claim of unpaid or improperly paid benefit contributions.

Improperly Paid Benefits: Representative Engagements

The Claim: Unpaid Time Owed (and Not Paid) at Termination

Welch Consulting was retained by a national general merchandise retailer confronting class action allegation that not all accrued paid-time-off (PTO) was paid out at termination.

Our Findings

Our expert showed why the opposing expert’s calculations were incorrect and demonstrated why the analysis proposed by the plaintiffs would not be informative at the class certification stage. Class certification was denied.

The Claim: Unionized Airline Employees Owed Vacation Accrual Pay 

A major airline retained Welch Consulting to analyze vacation accrual as part of a union-employer dispute.

Our Findings

Our experts calculated potential damages arising from differences between a negotiated contract and the requirements of federal law regarding the treatment of military leaves of absence.

The Claim: “Use it or Lose It” Vacation Days Policy Is Illegal

Welch Consulting was retained by plaintiffs’ counsel to verify allegations of incorrect benefits payments stemming from a manufacturer of printers and related supplies with a use-it-or-lose-it vacation policy.

Our Findings

One of our economists estimated the value of the forfeited vacation time and provided expert testimony at trial.

Alternative Work Arrangements

Alternative work arrangements involve agreements that an employee will work non-standard hours/shifts during a pay period and therefore agrees to forgo otherwise required payments.  These agreements can affect payments of overtime for hours worked over 40 in a week or, at the state level, more than eight hours in a day; for example, some persons work three 12-hour shifts per week, followed by a four-day, 11-hour shift week, such that 80 hours are worked over the two-week period.

Alternative Work Arrangements: Representative Engagements

The Claim: “Shift-Switching” at Airline Caused Illegal Loss of Overtime Pay

Counsel for a major airline transportation company retained Welch Consulting to examine the incidence rate of “switched shifts” among employees, which plaintiffs claimed led to unlawful overtime payment practices and violations of minimum wage law.

Our Findings

Using timecard and payroll data, our experts examined the incidence rate of potential violations, providing defendants with reliable evidence to address the frequency of violations, and calculated overtime pay consequences for employees involved in shift “switching.” 

The Claim: Incorrect Overtime Paid Due to Alternative Work Schedules

A national insurance firm retained Welch Consulting to investigate overtime payments made to employees with Alternative Work Arrangements. The company’s systems were not properly tracking the alternative arrangements, resulting in payment of overtime when it was not due and failure to pay in instances wherein it should have been paid.

Our Findings

Welch Consulting’s experts used Company time records to identify employees with alternative schedules and corrected miscalculated overtime amounts.

 

Time Clock Rounding

Some employers round paid time for non-exempt employees to the nearest 5 or 10 minutes, or to the nearest quarter-hour.  As long as the system of rounding is “fair” to the employee—i.e., on average, an employee is not systematically underpaid—rounding of time has been found to be legal.

Time Clock Rounding: Representative Engagements

The Claim: Time Clock Rounding Reduced Employees’ Paid Time 

Welch Consulting was engaged to assess whether a national home improvement store chain systematically reduced employee minutes at clock-in and clock-out during each shift due to rounding minutes to the nearest 15 minutes.  

Our Findings

Our expert analyzed each shift worked over a four-year period and compared time that would be owed to each employee with and without rounding minutes to the nearest 15-minute clock segment. We found that the company’s practice of rounding at the shift level and not rounding each individual clock-in or clock-out led to a statistically unbiased outcome, meaning there was no evidence that employees were systematically deprived of paid time due to rounding. This evidence led to a dismissal of the alleged class at Summary Judgement.

wage and hour claims

Other Wage and Hour Claims

Many aspects of the employer-employee relationship can be challenged if an employee can claim damages to himself or herself arising from a company policy or practice. Because of the “non-standard” nature of such claims, we have found it constructive to work closely with an employer’s inside counsel, human resources, or payroll personnel at the beginning of an assignment to ensure we are framing the analyses correctly. The employer may then choose to proceed with a full employment practice audit to potentially prevent concerns in the future.

Other Wage and Hour Claims: Representative Engagements

The Claim: Practice of Paying Overtime in “Wrong Week” is Illegal

An energy company operating in several states retained Welch Consulting to assess back pay exposure under the FLSA, due to the company’s practice of paying hours on shifts that cross two work weeks, in only one week. Since all hours associated with a shift were “frontloaded” and paid in the prior week–potentially moving hours worked on a new calendar day out of the week when they were worked–this could have resulted in overtime violations under the FLSA, due to incorrect payment of an overtime premium on hours worked over 40 in the second week. 

Our Findings

Our expert analyzed the available time clock, schedule, and payroll data sources to calculate additional overtime premium payments owed due to “frontloading” after taking account of proper offsets.

The Claim: “Tip-Pooling” Violated Minimum Wage Laws

Welch Consulting was retained to calculate damages for a nationwide restaurant chain whose tip-pooling practice was alleged to violate minimum wage laws.

Our Findings

Welch Consulting’s experts analyzed the allocation of monies paid out to first-line supervisory employees who, it was argued, were only entitled to share in the tips if they were not engaged in supervisory duties. Our calculations were used in mediation to reach a settlement.

The Claim: Non-Compliance with Service Contract Act

Welch Consulting was engaged to assess compliance with the Service Contract Act for an industry-leading national delivery company.

Our Findings

Our expert analyzed wage and benefits compliance with SCA regulations for thousands of employees in multiple business segments, performing different kinds of work nationwide. We calculated estimates of potential exposure under several alternative measures of government contract work and developed models for increased compliance.

Download Our Wage and Hour Brochure

Connect With Us


Start the conversation today by contacting us below.