Complex wage and hour litigation often involves significant data management and sophisticated analyses in order to assess potential liability and damages. This article highlights common wage and hour data management issues, sampling and surveying, as well as provides a case study as an example of the use of sampling in an overtime misclassification case.

Download Dr. Dwight Steward and Matt Rigling’s paper on wage and hour expert economists here!

Economics and Statistics Experts in Wage and Hour Litigation

Often in wage and hour cases, attorneys are faced with the decision of analyzing the complete time and payroll records for a class population, or analyzing just a sample of the population’s records.  While in an ideal world, analyzing the full population of data is the best approach, it may not always be feasible to do so.

For instance, some of the individuals within the class may be missing records due to poor data management, or perhaps both sides agree that the analysis of the full population may be too costly or time consuming.  In these cases, the attorneys can elect to have an expert randomly select a random sample from the full population to perform a reliable and statistically significant random sample.

Below are some common terms related that attorney’s can expect to hear when discussing sampling in their wage and hour cases:

Random Sampling, n. sampling in which every individual has a known probability of being selected.

Sample, n. a set of individuals or items drawn from a parent population.

Sample Size, n. the number of individuals or items in a sample.

Simple Random Sampling, n. sampling in which every individual has an equal probability of being selected and each selection is independent of the others.

Discussion: This very common statistical routine is analogous to ‘pulling a name out of a hat’.

Stratified Sampling, n. a method of statistical sampling that draws sub-samples from different sections, or strata, of the overall data population.

Discussion: Stratified sampling routines are used in employment settings when there are important differences between different groups of employees being surveyed. For example, in a survey of off-the-clock work, workers at different locations, and with different supervisors, may have different work cultures that make them more (or less) likely than other workers to have worked during their lunch period. In this instance, a stratified sampling routine may be used to account for those differences.

A common allegation in wage and hour lawsuits is off-the-clock work.  In these types of cases, employees usually allege that they performed work, such as travel between job sites, that they were not paid for performing.  Other common off-the-clock-work allegations typically involve activities such as spending time in security checkpoints, putting on a uniform, preparing for work, and logging onto computer systems.

Recently, the EmployStats Wage and Hour Consulting team completed work on a case where Plaintiffs alleged unpaid off-the-clock work for time spent driving from their homes to their job sites, as well as travel time between job sites.  In this case, EmployStats was able to analyze and assess Plaintiffs’ allegations by combining and creating datasets of personnel and job location data, and using mapping programs to calculate the time Plaintiffs could have potentially spent traveling and performing off-the-clock work.

The following is an example of how the EmployStats Wage and Hour Consulting team typically handles a case involving travel time:

1. First, the Employstats team works to combine and merge multiple databases containing employee home locations, employee time and payroll records, and job site locations into a single analyzable database.
2. The EmployStats team then uses mapping platforms, such as Google Maps API or Mapquest API, to calculate the distance in miles and/or travel time in hours for each unique trip.
3. Finally, the EmployStats team uses the employee time and payroll records to assess any potential damages due to travel time off-the-clock work.

Check out the EmployStats website to see how we can help you with your wage and hour cases!

The EmployStats Wage & Hour Consulting Team recently completed work on a case in the state of New York where the Plaintiff’s alleged unpaid straight time and overtime compensation due to the Defendant’s timekeeping policies.

In this case as well as others that EmployStats has worked in the past, the Plaintiff’s alleged that the Defendant’s had a timekeeping policy which systematically understated the employee’s time worked in a given pay period.  In practice, some time clock rounding policies may be neutral in principle, but non-neutral in practice. For any number of reasons, the employee or the employer may benefit more often than not from a seemingly neutral rounding policy.

The analysis that we perform typically involves manipulating, matching and analyzing big data from inherently incompatible time and payroll databases.  In addition to analyzing the alleged straight time and overtime compensation owed to employees, EmployStats also assists attorneys in the calculation of penalties.

In states such as California and New York, there are penalties for noncompliance with the labor codes.  We work with attorneys to calculate the appropriate penalties and interest in the lawsuit or investigation.  The EmployStats Wage & Hour Consulting Team is proficient at providing calculations and tabulations that are insightful and well documented.

The EmployStats consulting team, lead by Matt Rigling, MA, recently worked on a case involving employee misclassification.  EmployStats assisted attorneys by calculating potential damages for employees who were classified as exempt but potentially should have been classified as non-exempt and therefore owed FLSA overtime wages for hours worked over 40 in a workweek.

Matt Rigling and the EmployStats team also worked to use the case data and information provided to confirm whether the employees in question passed both the salary and duties tests for exemption purposes. According to the FLSA, an employee can be classified as exempt under the Administrative, Executive, or Professional exemption if they meet all of the requirements for salary and job duties.  

In this case, EmployStats compared the employee information to the salary and job duty requirements of the Administrative and Executive exemptions.  Under both exemptions, the employee must be paid a salary of at least $455, as well as meet the job duties specific to an Administrative or Executive employee.  According to U.S. Department of Labor, Administrative employee’s primary job duty must be office work that is “directly related to the management or general business operations of the employer or employer’s customers” and must include “the exercise of discretion and independent judgement” for matters of importance.  Similarly, Executive employee’s primary job duty has to be managing the company, or a department of the company. Additionally, they must also regularly direct at least two other full-time employees and have the authority to at least recommend the company fire, hire, or promote other employees.

To see how EmployStats can assist you with an employee misclassification case or another labor and employment matter, please visit www.EmployStats.com or give us a call at 512-476-3711.  Also make sure to follow our blog and find us on social media! @employstatsnews

The EmployStats team is thrilled to announce a new division of expertise that we can now provide to our clients.

Starting in January 2019, the new Wage and Hour Data consulting division began operation under the leadership of Consultant Matt Rigling.  Matt Rigling obtained his Master’s of Arts in Economics from the University of Texas at Austin, and has been providing EmployStats’ clients with database and data analytics consulting for the past three years.  Under this new division of EmployStats, the team will strive to provide our wage and hour clients with the expertise they need in the construction and tabulation of time and pay record databases, as well as providing wage and hour penalty calculations for our clients in states such as California and New York.  

This type of consultation is perfect for both plaintiff and defense attorneys seeking to have the best support for their client in order to efficiently reach a settlement at mediation, as well as both private and government entities simply seeking to perform internal audits of their labor practices.  EmployStats has the capability to swiftly handle large and cumbersome data sets that can sometimes bog down attorneys and paralegals attempting to handle the analysis in-house.

Follow this blog as we continue to post about tips for efficiently using data to bring your wage and hour cases to settlement, updates on upcoming events, and current events in the world of labor and employment law.  For more information on Matt Rigling and the EmployStats team, please check us out on our website and social media accounts!

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In late 2016, the US Department of Labor announced a final ruling on overtime, which may go into effect later this year and increase the number of workers eligible for overtime payment.  Here at EmployStats, our specialized team of Research Associates and Economists is fully capable and ready to handle all your wage & hour needs.

At EmployStats, we analyze FLSA and wage & hour violation claims, including time clock rounding, misclassification, off-the-clock work, and missed meal periods.  Our analyses of wage & hour violations typically involve the statistical review of information such as employee time punch records, payroll data, and employee time diary information.  Our goal at EmployStats is to communicate effectively with our clients and fully invest in the project at hand, in order to achieve the best outcomes and form long-lasting professional relationships.  

Our wage & hour clients include plaintiff and defense attorneys, as well as individual employers across the country.  Our wage & hour projects include expert witness trial testimony, expert reports, consultation, and compliance self-audits.  Statistical sampling is used to investigate wage & hour violations in some cases as well.

For more information on how EmployStats can help you with your wage & hour needs, please visit our website at www.employstats.com/wage-and-hour.

On Wednesday, May 18th, 2016, The Obama Administration announced a significant expansion of who qualifies for overtime pay under federal labor laws. The Department of Labor has issued the Final Rule, which centers primarily on updating the salary and compensation levels needed for executive, administrative and professional workers to be exempt from overtime pay protections.

The Final Rule increases the salary threshold from $23,660 to $47,476, which is the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region of the United States. The Department of Labor projects the policy to extend overtime protections to an additional 4.2 million workers, as anyone earning less than the salary threshold is now eligible for overtime payments.

The Final Rule also sets the total annual compensation requirement for highly compensated employees at $134,004, which is the annual equivalent of the 90th percentile of full-time salaried workers in the United States. The Final Rule also amends the salary basis test to allow employers to utilize non-discretionary bonuses and incentive payments to account for up to 10% of the new standard salary level. Lastly,  the ruling establishes a procedure for automatically updating the salary and compensation levels every three years to maintain the levels at the 40th and 90th percentiles of earnings.

The Final Rule will take effect on December 1, 2016, giving employers over six months to prepare and adjust their payment policies. In response, employers will have the options to pay time-and-a-half for overtime work, raise workers’ salaries above the new salary threshold, limit workers’ hours to 40 hours per week, or a combination of the above.

For more information on the new overtime ruling, please visit http://www.dol.gov/featured/overtime.

Video from the Department of Labor:

https://youtu.be/UFJaDm720FU

The Occupational Employment Statistics (OES) program, conducted by the Bureau of Labor Statistics (BLS), provides employment and wage information by occupation and geographic location. Hourly and annual mean and median wages are available for more than 800 different occupations at the national, regional, state, and MSA level.

According to the latest OES news release, the healthcare industry employed 12 million people in May 2015, which represents nearly 9% of the nation’s total employment. Registered nurses (2.7 million), nursing assistants (1.4 million), and home health aides (820,630) were the largest healthcare occupations.

For more information, please refer to www.bls.gov/oes

Local Area Unemployment Statistics (LAUS) is made available by the Bureau of Labor Statistics (BLS), and offers monthly data on employment and unemployment for approximately 7,500 geographic areas. Unemployment rates are available monthly by county, MSA, and state level.

These estimates are key indicators of local economic conditions, and may be compared over time to examine changes in the labor market.

For more information regarding the LAUS, please refer to www.bls.gov/lau