Make Sure You Understand Your Contract of Employment
If you have an employment contract, we can assume that you didn’t exactly read it with a fine-tooth comb before you signed it. But now, you should review it to see if you have any relevant rights in that contract that could help you as you consider suing your employer to get the unpaid wages you deserve.
Any employment contract or agreement will likely include language discussing payment terms and conditions. The most common scenario is an agreement that pays a set salary, typically to salaried employees. Some contracts also include additional benefits and bonuses. But other types of employment practices are not as contract-oriented. For example, if your employer has consistently paid you on the 15th of every month for the duration of your employment and you never signed an employee contract indicating any other type of payment schedule, it’s likely that your employer is still legally bound by the terms and conditions even if that information wasn’t explicitly laid out in writing .
Many employers these days insist that their employees sign some form of employment contract, which may include clear language on issues such as:
• What is classified as "work" and what is not
• The distinction between exempt and non-exempt employees
• Details regarding overtime compensation
• Payment schedules
• What constitutes a violation of contract
Part of your employer’s fiduciary responsibility is to fulfill the terms of your contract or agreement, and if they do fail to pay you based on the terms of your contract, you may have legal grounds on which to pursue them in court.
This is another area of the law that is very hard to analyze without the assistance of an experienced unpaid wages attorney. It can be almost impossible to determine whether your contract was fulfilled without having a good understanding of its terms, and the circumstances in which your boss has decided to withhold your paycheck may mean you have a case for legal action.
Collect Evidence of Any Unpaid Wages
To file a lawsuit for unpaid wages against the employer, your lawyer will require evidence that shows how much you were owed in wages and how much you have actually been paid. Therefore, as much information as possible about your wages and pay history will be necessary. The following information will help your lawyer ascertain the amount you were owed from your employer, as well as how much you were paid:
• Pay stubs – These are important because they show exactly how many hours you were expected to work, how many hours you actually worked and whether your employer paid you fairly. Note the overtime rate on your pay stubs and whether you were paid overtime for all hours you worked that were in excess of 40 hours per week. If you were paid a salary, broken down how you would be paid hourly.
• Time sheets – These should indicate your starting and ending times each day, as well as breaks taken throughout the day.
• Written correspondence with the employer – Keep track of all communication you have had with your employer, whether on unpaid time off for vacation or sick leave or acknowledgement of unpaid wages, as this will be used as evidence of your attempts to receive proper and timely pay.
Any information you have about your employment is valuable to your unpaid wages claim. Your lawyer will likely go through all potential means of evidence before moving forward with your case, so be honest and thorough about your file, let your lawyer know of anything that could help your case or hurt it.
Try to Settle the Matter Expediently
There are various methods by which you can attempt to first resolve a payment issue with an employer before pursuing any sort of legal action for unpaid wages. This is something we always encourage our clients to try before seeking legal action for owed wages and other unpaid compensation. While in many situations employers refuse to pay employees for their hours worked or the relevant overtime wage rates, you might be surprised by how many employers will recognize a mistake or rectify an oversight when it is brought to their attention. For example, in the event that your employer is not categorizing you as a non-exempt employee, and you are not getting paid for overtime hours worked, you might receive a check for the overtime hours as well as an explanation as to the overpayment after attempting to speak with an HR representative or your employer directly. In addition to speaking with your employer directly, if you think that the problem may just be a simple oversight, you can also formally bring this fact to the attention of your employer by way of a letter. This letter should include a basic outline of what led to your decision to write this letter, namely, that you have not been properly compensated for the hours worked or the applicable overtime hours. After the employee makes the request to pay, the employer has some time to properly pay you. In this situation, your employer may actually agree to pay you for the hours you claim to have worked either in your initial oral complaint or in your letter.
Know your Legal Rights
Understanding your legal rights and protections under federal and state labor laws is essential when pursuing a claim for unpaid wages. In most cases, when an employee works for a company, state and federal laws dictate they must be compensated fairly and on time for the work they perform. Whether you negotiate an employment contract before starting work or receive a written paystub upon receiving compensation, the law requires you to be informed about the terms of your employment, including how you will be paid. Failing to pay wages in full is a violation of those terms, meaning seeking recourse from those who violate them is well within your rights as an employee.
Consider Filing a Wage Claim
If you do not have an option of taking legal action for the company that owes you wages, or if you would like to hold that company accountable in one more way, you may consider filing a wage claim. You can do this by filing a claim with the state department of labor or equivalent agency. This section will provide an overview of how this process works.
Usually, states require that you complete your form and submit it. If you are supposed to send money or evidence, you typically submit this information online. As with lawsuits, you’d send copies of things instead of the originals. After the state labor department has received your form, it would send your complaint to the employer who owes you money, along with a request for a response. The employer can respond with its own information, but in some areas, they may even have a chance to negotiate and settle with you before the staff member or investigator looks at the information in the case. If the employer chooses to address the problem by negotiating or exchanging information with you , your problems may be solved right then and there. If not, the investigator examines the wage claims and responses from both parties. They then make a determination about what kind of damages and wages the employee should receive. If the department does issue an order, the employer is required to abide by it. However, if they fail to pay, you would then need to go to court in order to collect. In such a situation, you could get help via many resources from the state. For example, you might be eligible for pro bono services to help you take the employer to the small claims court. The state may charge a fee for processing a wage claim. In addition, there are deadlines that you need to follow. Given all these factors – the fees, the deadlines, the work involved and whether you will get the right amount of damages – some people feel that suing is more straightforward and that it provides better compensation.
Decide if You Need an Attorney
In most cases, hiring an attorney is the best option for getting the problem resolved fairly and as quickly as possible. An attorney who specializes in employment law, or better yet, one who focuses exclusively on the problem you’re dealing with (like wage and hour disputes), has probably handled it many times before and will be much better prepared to navigate the legal process.
Exceptions
That being said, some cases are small to the point that the added expense of hiring a law firm isn’t justified. This could be the case if all you need to do is send a demand letter. Sometimes employees have been paid what they think they were owed, but they’re not sure how much was deducted from their paycheck for taxes, etc., so they can’t determine whether the amount is truly correct. In these situations, it makes sense to just talk to the company’s human resources department or outside payroll company to get more information.
You can often take care of small claims in small claims court without hiring an attorney. If the amount you’re owed is under the magic limit set by your state for small claims division, the filing fee is probably pretty low, and you may not be required to provide too much evidence. You can probably write your own claim, if needed, with a simple web search. An employment law attorney can help you prepare your claim, but if the amount you’re seeking is small (less than about $1,500), you probably don’t need a lawyer’s assistance through this process.
Exceptions to the exceptions
In many smaller cases, even though you don’t technically need an attorney, having one can keep the process from dragging on for months or years. This is especially true if the person or company you’re suing for unpaid wages has some legal support. If the amount you’re owed is substantial—more than five thousand dollars—and you choose not to hire an attorney, you could be looking at a long fight. You might find that having an attorney represent you isn’t so bad after all.
Commence a Lawsuit if it is Necessary
If your employer still does not pay you despite having filed a wage claim with the State and/or having sent them a demand letter for payment, then you may want to consider suing the company directly. It is often the case that I have former clients who have received no response to their demand letter. This is usually not a good sign, especially if the demand letter was sent to the Company’s Chief Financial Officer. It is likely that the Company intends to defy the law and may only pay your unpaid wages to avoid a lawsuit, i.e., to buy you off.
The first step in suing is to file a lawsuit in Arizona Superior Court. These lawsuits can only be filed in the County where you worked and/or where the unlawful conduct occurred. The lawsuit must also be filed within 1 (one) to 3 (three) years after the unlawful conduct occurred or when it was discovered depending upon the nature of the claim asserted.
Once you have filed the lawsuit, a copy of the complaint must be served on the Defendant via a process service or by registered mail. Now, you might be thinking – "what’s the big deal?" Well…it is critical that the defendant actually get a copy of the complaint so that it will be forced to respond to the allegations of wrongdoing.
Once the Defendant has been served, it must file a response to your complaint within a certain period of time. Should the Defendant fail to do so, you are entitled to take default against the Defendant and ask for the Court to grant you favorable judgment. Should the Defendant file a response, then the court will set the matter down for a Scheduling Conference which the Parties will attend. The Judge will set out a case schedule and give you a preview of what he/she expects to happen. You and the Defendant will also exchange full and complete discovery involving document requests and written questions (Interrogatories). You may also be required to sit down for a formal deposition where you will be questioned under oath. After the depositions are completed, the parties will attempt a resolution of the pending issues through mediation. Should a resolution not then be reached, you should be prepared to go to trial.
Possible Outcomes and Remedies
If you have not been paid your required wages, federal law provides for a range of possible damages and remedies. If that company does not pay you, under FSLA you can receive all of your back pay, and the amount equal to double your regular pay, which is known as liquidated damages. If the company refused to redo records in which it manipulated the time you worked to reflect a lower wage than what you are actually owed (the wages you earned), then you can recover liquidated damages – double the amount due to you on the basis of the wage and hour violations. In the case of FLSA, it is mandatory that they be given, not discretionary. (29 U.S.C. § 216(b)). Employers that willfully and intentionally violate the FLSA may also be liable for punitive and compensatory damages under the Portal-to-Portal Act . Other damages can include: • If the employer is a corporation, the court can also hold managers and corporate officers personally liable. • Back pay, liquidated or double damages depending on the case outcome • Reinstatement of employment with back pay if suitable • Job application fees • Attorney fees, court costs and costs of process • Interest and prompt payments of amounts due after court judgment • Reimbursement for any wages wrongly withheld, including overtime wages • Compensation for emotional distress • Severance pay • Punitive damages • And more The National Labor Relations Board gives you the right to recover damages if you are retaliated against by your employer for exercising your rights. If that happens you can file an unfair labor practice charge against that employer and have that company answer for is illegal act toward you.