Wage & Hour Dispute Lawyer in Philadelphia

Improper Calculation of Overtime in Philadelphia

Sometimes, employers improperly calculate overtime pay due their employees.  For example, this might happen where the employee is paid a flat rate (i.e., a salary, piece rate, or a day rate) and the employer fails to properly calculate the employee’s “regular rate of pay” for purposes of calculating overtime pay.  The U.S. Department of Labor’s Wage and Hour Division has issued extensive rules concerning the regular rate calculation.  For example, if a non-exempt employee is paid daily and works more than 40 hours, their regular pay rate is calculated by dividing their day-rate compensation for that week by the number of hours worked. The employee’s overtime pay is then based on the regular rate calculation.  Employers often are not in compliance with this rule.

Employers who fail to comply with the correct calculation methodology can face severe legal and financial consequences. Workers who suspect discrepancies in their overtime pay should gather records of hours worked and compare this against their received compensation. Understanding the nuances of overtime pay calculation can also help employees recognize when they are being shortchanged, and whether they might benefit from engaging a wage and hour attorney Philadelphia trusts for legal counsel.

Off-the-Clock Work Issues & Solutions

Sometimes, employees perform overtime work, but the employer does not keep track of (and pay for) this time.  This may happen when a construction worker must show up to the employer’s yard to load tools and equipment in a truck but is not paid until the employee reaches the day’s construction site.  Or, sometimes, an employee is required to wear Personal Protective Equipment (PPE) to do their job but is not paid for the time to “don” or “doff” the PPE.  Further still, an employee might have time deducted for a “lunch break” but still be required to perform productive activities for the employer.  The Department of Labor even requires that any rest breaks (even if no work is performed) must be paid for if they are 20 minutes or less in duration.  Any of these scenarios, and a myriad of others, could result in a claim for unpaid overtime against the employer.

Ensuring all hours worked are accurately logged and compensated is vital for fairness in the workplace. Employees should be diligent about tracking their own time when they suspect off-the-clock work practices. Documenting communications with employers regarding work hours and job expectations can also support potential claims for wage theft or unpaid time. Legal guidance can be pivotal in collecting owed wages, making it important for affected workers to consult a reliable wage and hour lawyer near them for assistance.

Restaurant & Service Workers in Philadelphia 

Under both federal and state law, waiters, bartenders, cocktail servers, bussers, runners, and other service workers generally must receive the applicable minimum wage for each hour worked and must receive overtime compensation (time-and-a-half) for each hour worked over forty (40) hours in a workweek.

Tipped Minimum Wage Guidelines

In the service industry, employers are permitted to pay their service employees a lower “tipped minimum wage” and take a “credit” for the tips their employees receive, as long as the employee’s tips make up the difference between the hourly wage paid and the applicable full minimum wage, for each hour worked in a workweek.

For example, in the District of Columbia, the minimum wage is currently $17.00 per hour, and the tipped minimum wage is $6.00 per hour. So, while it is permissible for a restaurant industry employer to pay its service staff the lower tipped minimum wage of $8.00 per hour, for the employer to comply with the D.C. Minimum Wage Revisions Act, the employee must also receive tips equal to at least $9.00 per hour.  Otherwise, the employer must pay the difference.

In New Jersey, the tipped minimum wage is currently $5.26 per hour.  The same is in D.C.; the employee’s tips must make up the difference between the tipped minimum wage paid and the full New Jersey minimum wage. 

Tip Credit & Compliance

However, to take a “tip credit” towards it minimum wage obligations to its employees, a restaurant industry employer must provide specific notices to its employees regarding the tip credit.  In the District of Columbia, for example, employers must provide their employees with written notice of their pay rate, the employer’s use of a “tip credit,” and the terms of a valid tip-pooling or tip-sharing policy (if utilized by the employer). Additionally, employers in D.C. are required to post their tip-sharing policy within their business.  

If employers do not comply with these notice requirements, the employees may have a legal claim for significant amounts of unpaid wages against the employer.

Common Wage & Tip Violations in the Restaurant Industry 

Here are some common wage and tip violations that occur in the restaurant industry:

• The restaurant (or bar) or its managers impermissibly keep or retain a portion of the service workers’ tips. This is not permitted.
• The restaurant pays its servers no hourly wages at all. Even if the service employees receive hundreds of dollars in tips each night, the employer still must pay the applicable tipped minimum wage for each hour worked, regardless of the amount of tips earned. In New York City, the tipped minimum wage is $12.50 per hour.
• A restaurant’s tip-sharing policy requires its service staff to share tips with staff who do not have customer interaction. A waiter or bartender cannot be required to share their tips with line cooks or dishwashers without customer interaction.
• Service employees cannot be paid the tipped minimum wage for all hours worked when not all those hours are spent serving customers. For example, if a service worker spends hours cleaning the restaurant each day, the employee must be paid the full applicable minimum wage for those non-service cleaning hours.   

Ways to Protect Your Rights Against Wage Theft

Wage theft can be a prevalent issue, even in a well-regulated city like Philadelphia. Employees must be vigilant in protecting their rights. One of the most effective ways to do this is by maintaining detailed records of your work hours and pay, including overtime and any discrepancies between expected and received compensation. This documentation can serve as crucial evidence in a wage dispute.

Additionally, staying informed about your rights under both state and federal law is essential. Engage with resources provided by institutions like the Philadelphia Department of Labor and local workers' rights organizations, which offer seminars and resources tailored to educating employees about wage-related laws. If you suspect a violation, consulting with a wage and hour lawyer Philadelphia residents rely on can also provide a clearer path to rectifying discrepancies and ensuring you receive the wages you have earned.

FAQ: Wage & Hour Disputes in Philadelphia

1. What is a wage and hour dispute?

A wage and hour dispute occurs when there is a disagreement or violation regarding how employees are paid for the work they perform. This may involve issues such as overtime pay, misclassification, failure to pay minimum wage, or improper deductions from wages.

2. What is the minimum wage in Pennsylvania?

As of 2024, the minimum wage in Pennsylvania is $7.25 per hour, which is the same as the federal minimum wage. However, some cities or counties may set a higher minimum wage, and employees in certain industries, such as hospitality, may receive tip-based wages, which also have specific requirements.

3. Can I sue my employer for unpaid overtime?

Yes, if you are a non-exempt employee and have not been paid the overtime wages you are entitled to, you can pursue a claim against your employer for unpaid overtime. This can also include seeking liquidated damages and interest on unpaid wages.

4. How do I know if I’m exempt from overtime?

Exemption from overtime depends on your job duties and salary. Common exemptions apply to employees working in executive, administrative, professional, and outside sales positions. However, many employees who believe they are misclassified as exempt may still be entitled to overtime pay.

5. What is the statute of limitations for filing a wage claim in Pennsylvania?

In Pennsylvania, the statute of limitations for filing a wage claim under the Fair Labor Standards Act (FLSA) is two years from the date of the violation. In cases of willful violations, the statute of limitations may extend to three years.

6. Can I be retaliated against for filing a wage and hour claim?

No, it is illegal for an employer to retaliate against you for asserting your wage and hour rights. This includes firing, demoting, or taking other adverse actions against you for filing a claim or complaining about wage violations.

7. Can I recover my attorney’s fees in a wage dispute?

Yes, in many cases, if you win your wage and hour dispute, you may be entitled to recover your attorney’s fees and court costs in addition to the back wages and damages you are owed.

8. How does serving in the gig economy affect my wages?

The gig economy, marked by flexible, short-term, or freelance positions, often poses challenges regarding fair wage practices. Gig workers might face difficulties related to independent contractor misclassification, thereby affecting their access to minimum wage, overtime pay, and other legal protections afforded to employees. It's crucial for gig workers in Philadelphia to understand their employment status and rights.

Engaging with local resources can assist in demystifying gig work classifications. If in doubt about your classification or wage entitlements, you may benefit from speaking with a wage and hour lawyer Philadelphia residents trust. Recognizing patterns of exploitation and taking proactive measures can help gig workers safeguard their earnings and rights.

9. Are there specific protections for Philadelphia workers?

Yes, Philadelphia has instituted additional protections to ensure fair wages for its workforce. The Wage Theft Ordinance strengthens efforts against wage theft by establishing protocols for workers to report violations and obligations for employers to ensure compliance. Philadelphia's proactive stance in amending laws to better fit the city's unique economic landscape highlights its commitment to promoting equitable labor practices.

Being aware of such local ordinances and tapping into resources like the Philadelphia Workers' Compensation Library can be pivotal. These tools are designed to equip local workers with insights to recognize unfair labor practices and claim their rightful earnings, thus fortifying the legal environment in favor of fair work conditions.