Back wages are wages that an employee is owed but have not been paid by their employer when due. These would be the ordinary wages the employee was supposed to receive per their salary or hourly wage agreement. Back wages are sometimes called retro pay or back pay, depending on the state in which a person lives.
Back wages could be the fault of the employer, an employee, or a combination of both. An employer may fail to pay their employees intentionally or because of an honest mistake. An employer might fail to pay their employees because they do not have the money to cover their payroll.
Some common examples include the following:
- An employer’s payroll service may make a mistake in calculating a paycheck.
- An employee’s wages may have been garnished.
- There may be a dispute or misunderstanding between the employer and employee about whether overtime is owed or whether the employee logged overtime hours.
- Conflicts between the employer and employee involving leave or vacation pay may lead to a dispute.
- Pay increases that are applied retroactively.
Generally, in a dispute over back wages, the employee believes they are owed more than they have been paid, and the employer disagrees.
Am I Entitled to Recover Back Wages?
The Wage and Hour Division of the federal Department of Labor (DOL) is the department of the federal government that enforces the federal Fair Labor Standards Act (FLSA). The FLSA sets the federal minimum wage, currently $7.25, overtime pay, recordkeeping, and youth employment standards for employers in private companies and in government employment.
Employees who are covered by the FLSA have a right to be paid the minimum wage of no less than $7.25 per hour. They have a right to be paid overtime pay of no less than one and one-half times the minimum wage rate after working 40 hours a week.
If a person has not been paid the amount to which the FLSA entitles them, they can file a complaint with the federal DOL. In order to do that, a person wants to collect information they need to report in the complaint as follows:
- The employee’s name, address, and telephone number;
- The name, address, and telephone number of the employer (or employment agency) against whom the complaint is made;
- The name of the owner or manager of the employer;
- A description of the type of job the employee had;
- When the work was performed; and
- How and when the employee was routinely paid, e.g., by check or electronic deposit, weekly, monthly, etc.
A person can file their complaint either online at the federal DOL website or by telephone at 1-866-487-9243. The federal Wage and Hour division of the DOL sends the complaint to the field office nearest to the employee’s location.
A representative of the federal DOL contacts the employee within two business days of the day when the complaint is filed. The representatives consult with the employee to determine whether an investigation is the best way to deal with the complaint. If an investigation is done and it is discovered that an employee is entitled to back wages, the DOL collects the funds from the employer and pays the employee for their unpaid wages.
An employee is entitled to be paid what they are owed under state and federal law even if they are not authorized to work in the U.S. If a person does not have work authorization, they can still file a claim for back wages with the federal DOL and file a lawsuit in state or federal court.
It is also important for an employee to keep in mind that many states have labor laws too, and the minimum wage in some states is higher than the federal minimum wage. Many states have their own overtime laws as well, again some more generous than federal law.
If a state does not have its own minimum wage and overtime laws, then federal law applies in that state. In the event that there are conflicting overtime laws between a state and the federal government, the employer must follow the law that is more beneficial to the employee, which in most cases is state law.
Under California labor law, employers are required by law to provide one-and-a-half times pay if an employee works more hours than the following:
- 40 hours in one week;
- 8 hours in a day;
- 6 days a week.
California also has a double-time law, which the federal government does not have. It provides that an employer must pay double their regular hourly pay if an employee works more than the following:
- 12 hours in one day;
- 8 hours on the seventh consecutive day of work in a week.
In California, if a person is owed back pay, they can file a lawsuit to recover the following:
- The amount owed, including interest;
- Any penalties.
If a person is concerned about the cost of hiring an attorney, they should know that some California employment lawyers represent employees on contingency agreements. Having a contingency agreement means the attorney does not get paid unless their client wins an award of damages.
In addition, California wage and hour laws require employers to pay an employee’s attorney’s fees in successful unpaid wage lawsuits. The employee’s attorney is paid by the employer, not the employee.
If an employer is not paying many of their employees the wages they are owed, then they might be able to file a class action lawsuit.
Can I Take My Claim for Back Wages to Court?
An employee may be able to take their back wages case to court under the FLSA. However, a person would want to turn to the federal DOL and file a complaint there first before filing a lawsuit in a court of law.
In some cases, the federal DOL may take steps other than investigating a complaint, as described above, to get unpaid wages for employees. For example, they may do the following:
- The Secretary of Labor may file a lawsuit on behalf of a group of employees;
- In the lawsuit, the Secretary of Labor may win an injunction that orders an employer to stop unlawfully withholding minimum wage and overtime pay owed to their employees; or
- If the Secretary of Labor has not acted, an employee may file a private lawsuit.
Suppose an employee has to file a lawsuit to recover their back wages. In that case, the employer may have to pay not only the back wages, but also an equal amount in damages, as well as attorney’s fees and court costs.
Employers in all states must follow the FLSA guidelines. There will usually be a two-year statute of limitations to recover back wages. This is extended by one year if the employer acted willfully in withholding wages.
If an employee’s employer has violated state labor laws regarding minimum wage and overtime, then the person could turn to their state’s DOL. A person might file a claim with their state’s DOL. Or, they might file a lawsuit seeking their back pay in a state civil court. For example, in California, a person can sue their employer for back wages in state court.
Both federal and state laws provide that an employer cannot retaliate against an employee for filing wage and hour claims or complaining to a government agency about violations of wage and hour laws.
If an employer were to fire an employee for filing a claim, it could be wrongful termination. Other forms of retaliation are also forbidden. If an employee’s employer retaliates against them for filing a lawsuit seeking back wages, then the employee has yet another cause of action against their employer. This additional cause of action can be a separate claim for additional compensatory damages.
Do I Need the Help of a Lawyer for My Back Wage Dispute?
If you believe you have not been paid all the money you have earned, you should consult an employment lawyer for advice.
Your employment lawyer can help you file a complaint with the federal DOL or your state’s DOL, whichever is the better choice. A LegalMatch lawyer can help guide you to the best route for recovering the wages you are owed.
