Before a Wage & Hour Division Investigation

Take preventative measures to minimize exposure:
• Check all current and recent (within the last several years) 1099’s and agency vendor agreements
– review job duties of those named independent contractors and verify that they should not be classified as employees
• Make sure that all job descriptions are current, accurately reflect job duties, and justify exemptions
• Review time keeping systems
• Employers may round up or round down fractions of hours up to 15 minutes (must be done consistently)
• Ensure that payroll records and record keeping procedures are current, accurate, and compliant
• Make sure that the time keeping system is convenient for entering all hours worked
• Develop a formal program for reporting and resolving employee wage concerns
Familiarize Staff In:
• Exempt vs non-exempt status
– based on law and cannot be altered
– non-exempt employees must be paid for all hours worked
– exempt employees cannot have deductions based on quality or quantity of work
• Overtime and record keeping training
– FLSA and state wage laws
– wage and hour policies and procedures
• DOL inspection procedures
– refuse the compliance officer on site until a search warrant is obtained
– request 72 hours to meet investigative demands
– request interviews and on-site inspection to take place at a reasonable time
– obtain outside counsel to help navigate the investigation process
– protect confidential information and trade secrets
• DOL investigation rights to:decline to provide advance notice of on-site audits
– investigate with or without probable cause or consent
– inspect payroll and tax records
– conduct surveillance, take photos, and collect evidence
– conduct employee interviews
– issue and enforce subpoenas for records and interviews
Designate an Investigation Response Team:
• Assign the following roles
– team leader – the compliance officer’s main point of contact (usually an attorney or a senior management representative)
– opening and closing conference participants
– on-site representative to escort the investigator
– document production manager
– contractor liaison
– union liason
– interview representative (explains the interview process to employees and participates in management interviews)
• Designate a space for the opening/ closing conference, employee interviews, and for the Wage & Hour Division to work