With so many overtime lawsuits being filed, it would make sense that companies would stop violating the law and pay their workers what they are owed, but still many companies refuse to do so and employees are left working long hours without proper pay.
According to the lawsuit, filed by former Maximus employees, the company violated the Fair Labor Standards Act (FLSA) by not paying employees overtime wages when they worked over 40 hours in a week. Overtime activities included reading mandatory emails, calling back customers, and booting up computers. The employees involved in the lawsuit, Norah Johnson and Jennifer Beeton, worked at the company's Athens, Texas call center.
The home page for Maximus Inc. proudly announces that its employees have dedicated their careers to public service. Unfortunately, the company allegedly took advantage of that dedication by not paying employees properly for working extra hours, despite some of the overtime activities being deemed "mandatory" by Maximus officials.
Under the FLSA, employees who are nonexempt and work over 40 hours in a workweek must be paid at a rate of one and one-half times their regular rate of pay. In order to be exempt, an employee must receive a salary of no less than $455 per work and perform certain types of work. That work includes duties in executive, administrative, professional, computer, and outside sales positions; however, employees in those positions must pass a number of tests in order to be exempt from overtime wages. For example, they must spend more than 50 percent of their time in management duties and have authority to hire and fire other employees.
Judges can award unpaid overtime for the past two years worked and may also award attorney's fees and expenses. If an employer is found to have knowingly, willfully or recklessly violated FLSA laws, plaintiffs may receive overtime wages from three years prior to filing the lawsuit. Neither employers nor employees can waive the right to overtime pay, meaning that employees cannot simply agree to work overtime but be paid for straight time. Any time a nonexempt employee works overtime, her or she must be paid full overtime wages.
Besides Maximus, other companies have paid large amounts to settle overtime pay lawsuits. Those companies include Starbucks, Wal-Mart, EA and Radio Shack. Many companies have paid millions of dollars to employees to compensate them for unpaid overtime. In 2006, IBM paid over $65 million to settle claims that IBM illegally forced them to work over 40 hours a week without overtime pay.
Maximus has faced other lawsuits before. Earlier this year the company reached a $30.5 million settlement with the federal government to settle allegations regarding Medicaid claims from as far back as 1999 that did not have proper documentation. The government alleged Maximus helped the District of Columbia's Child and Family Services Agency submit false claims to Medicaid.
According to the Washington Post, in 2006 Maximus settled a lawsuit filed by a former female employee who alleged misconduct on the part of one of the company's senior officials. The official was fired and the plaintiff received a settlement of between $438,000 and $657,000. The exact dollar amount is not known, although according to a company statement the settlement cost Maximus two to three cents a share of its second-quarter results. That same year, Maximus paid $5.5 million to settle allegations that two former employees signed fraudulent lease guarantees.
It is against the law for a company to not pay its employees for working overtime hours. Many companies save a lot of money by not properly compensating their employees for overtime work. It is time these companies realized that they cannot get away with violating federal laws.