Many of my Construction Company Clients have recently been hit with Federal Labor Standards Act (FLSA) wage and hour lawsuits. This is not surprising as New York has the fourth largest amount of FLSA lawsuits nationwide and the construction business is one of the five industries worst hit. Construction seems to be an easy target for FLSA Plaintiff’s lawyers. Many corporate construction companies hire “day labor” which they consider to be independent contractors. Under the law, independent contractors are not entitled to overtime pay. These workers are generally paid a flat daily or weekly rate without regard to the length of their shift or breaks. The workers sometimes work long days to finish up a job and move around multiple worksites. There are frequently several contractors and subcontractors on a site, also making it difficult to track a worker’s exact hours. Foremen, considering them independent contractors, frequently fail to keep records of the hours worked. Most construction workers would not qualify as independent contractors. The Courts, in classifying construction employees, look at how much control the worker has over his job duties, if they use their own tools and equipment and whether the job is “hourly based” on “project based”.
The legislature and the Courts, in an effort to protect employees, have made defending these lawsuits very challenging for the corporate employer defendant. Even if no employment or payroll records exist regarding the worker, the worker’s testimony alone can form the basis for an FLSA lawsuit. The burden of proof then shifts to the employer to produce contemporaneous records disputing the employees’ claims. When one worker sues, he or his lawyer may seek to recruit other workers on the same site and the construction company could then be hit with a class action. Another landmine the employer must avoid is the urge to fire the worker suing him. This could then lead to a lawsuit for unlawful retaliation.
An FLSA wage and hour claim is usually a Federal lawsuit and must be taken very seriously. In addition to back wages, employers could be liable for liquidated damages and paying the claimant’s attorney’s fees and costs. It is important to retain a construction lawyer that is experienced in wage and hour litigation as well as the unique problems these lawsuits pose for construction company employers.