Nail salons are a booming industry. They’re popping up in strip malls and small towns across the country, providing manicures and pedicures to women of all socioeconomic backgrounds. These businesses can be lucrative for owners and employees alike. But what happens when workers aren’t paid fairly? What does this mean for employers? And who is responsible for enforcing these wage violations?
The problems range from failure to pay minimum wage, unpaid overtime hours, and not paying for required training time. Enforcement is also an issue as many of these violations go unreported because employees are afraid to report them for fear of retaliation. Most workers are low-wage, immigrant workers who are unfamiliar with their rights. Independent contractors are also an issue for this industry. These employees are seen as self-employed and do not have the same protections under the law even though they are expected to work full-time hours with no benefits.
Some employers will try to classify these individuals as independent contractors so that they aren’t responsible for payroll taxes or overtime pay. There is generally a misclassification of employees in small and large companies where there is a belief that some jobs can be done by independent contractors when it takes away employee protection under wage and hour laws.
Failure to pay minimum wage violation
When an employer fails to pay the minimum wage required by federal, state, and local laws, they are committing a wage violation. Employers who fail to meet this standard must compensate employees in accordance with state and federal laws. If you earn less than minimum wage when you work overtime, you should bring a claim against your employer for unpaid overtime wages.
Failure to pay training time
When an employer fails to pay employees for their required training time, they violate the minimum wage and overtime standards of the FLSA. What’s worse is that many employers fail to compensate employees for any on-the-job training sessions that require travel or other out-of-pocket expenses. Employees should be paid during their first week of employment, but some companies may try to waive this requirement as a way of gaining new recruits. Employers also sometimes call these payments “training fees” or “initiation fees” so as not to violate minimum wage laws. But don’t let yourself get away with this kind of wage violation.
Failure to pay overtime wages
The Fair Labor Standards Act (FLSA) states that most employees must receive overtime pay for hours worked over 40 per workweek at a rate not less than one and one-half times their regular pay rate. In many cases, workers are also entitled to non-discretionary bonuses, incentive payments, and commissions as part of their regular pay rate. Employers who fail to compensate employees the appropriate amount for these additional hours may be committing a wage violation under federal law.
Employers who violate the FLSA will have to compensate employees for the number of unpaid wages. In some cases, the employer will have to pay twice this amount if they willfully violate the law. For example, if you worked 40 hours a week and your federal minimum wage is $7.25 per hour, your employer would owe you at least $290 ($7.25 x 40). If they were caught violating the law and had to compensate you, then they would owe an additional $290 (double your unpaid wages), which comes out to a total of $580 for one workweek. For each pay period, your employer failed to follow the FLSA’s overtime rules can be calculated.
The United States Department of Labor (DOL) enforces all types of wage violations under the FLSA. They are responsible for investigating claims, holding public hearings to determine the outcome of cases, and overseeing employers who may violate wage rules. Victims of wage violations can file a claim with the DOL or bring their lawsuit against an employer directly if they choose to do so.
Employees may file complaints with the U.S. Department of Labor Wage and Hour Division to ensure that they are compensated correctly for these kinds of mandatory expenses, including travel time and training sessions. The best way to protect yourself against unfair business practices is to understand your rights as an employee, so you can pursue compensation if necessary.