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Labor Department Rolls out Payroll Audit Independent Determination (PAID)

WASHINGTON, DC — The U.S. Department of Labor recently rolled out a new program designed to help employers resolve inadvertent violations of federal labor and wage laws to help companies resolve their liability and ensure that workers receive all their due wages. Under the six-month pilot program known as Payroll Audit Independent Determination (PAID), employers will be able to resolve any potential claims by conducting self-audits and seeking help from the Labor Department.

PAID will allow all Fair Labor Standards Act (FLSA)-covered employers to participate in the program to seek the early resolution of potential wage and hour violations but will not allow those with existing civil claims or a known threat of enforcement action (such as a demand letter) to partake. The program is set to begin in April 2018 and after the six-month evaluation period, the Labor Department will evaluate the effectiveness, participation rate, and results of the program, at which point it will determine whether or not to make the program permanent.

Employers with potential FLSA concerns will start the process with an audit of its payroll and record keeping processes, after which it can choose to contact the Labor Department and request participation in the program. If the Labor Department accepts the request, the company will be asked for additional information about the specific FLSA violation. Common violations under the FLSA include unpaid overtime, employees earning less than minimum wage, and improper recordkeeping.

At the conclusion of the audit, the employers will be required to pay back workers 100% of the back pay, obtain several certifications, and ensure future wage law violations do not take place. The benefit to companies under the PAID program is that the employer will not be required to pay its workers liquidated damages equal to unpaid wages or other civil penalties normally required under the FLSA. Currently, the FLSA allows wage theft victims to file lawsuits to recover up to two years of back pay for non-intentional violations of the FLSA as well as recover various damages and attorneys fees.

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Our office will also determine if it is in your best interest to file a lawsuit against your employer. Because strict time limitations apply for filing these types of claims, we advise you contact our experienced unpaid overtime wage attorneys at your earliest convenience and preserve your legal rights.

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