Rep Ober has introduced HB 1126 concerning claims for unpaid wages, in particular the penalties available to employees making those claims. The procedures can get a little technical, but as a general proposition, if an employer hasn’t paid all of the wages to which an employee is due, the employee can sue the employer for the unpaid wages, plus a 200% penalty, plus attorney’s fees. If it’s a former employee, the Department of Labor is supposed to screen the claim before it can move forward. (A safeguard intended to counteract the baser impulses of a disgruntled employee who might be inclined to make stuff up.) In my experience, in recent years, the Department of Labor has been less than diligent in that screening function.
In any case, Rep. Ober’s bill would restrict those penalties. Rather than being more or less automatic, the 200% penalty and attorney’s fees would be discretionary with a judge and would be contingent on the employer having failed to make the payment in bad faith. The total penalty plus the attorney’s fee awarded could not exceed 200% of the unpaid wages.
This is maybe more restrictive than need be. But, I do think in these wage claim and wage payment cases the attorney fee tail is all too often wagging the dog of unpaid wages. You’ll see case reports that make it appear that a plaintiff’s attorney was pushing his client into pursuing a very marginal wage claim in hopes of getting lucky and getting a jackpot attorney’s fee award.
There is also language in this bill that would expand the permissible items eligible for wage withholding with the agreement of the employee, including equipment reimbursement, education reimbursement, and advance payroll or vacation pay.
This is one of the few pro-worker laws that Indiana has on the books. I’ve utilized it frequently to help recover unpaid wages for employees. The hammer provision of the law serves to help attorneys representing employees recover the wages and the appropriate damages without resorting to litigation. The Dept. of Labor doesn’t become involved with a wage claim unless the employee was involuntarily separated from employment without being compensated for all wages due the employee at the time of separation, in which case you are required to first file your claim with the Department. Typically, the Dept. of Labor will refer the claim to the Attorney General, which will assign the wage claim to a private attorney to pursue. The A.G., acting as DOL’s agent, only recovers the unpaid wages, so the A.G. prefers to assign the wage claim to a private attorney so the liquidated damages can be recovered as well attorney’s fees. Only in the case of where an employee voluntarily quits his job and has an unpaid wage claim can the employee sue the former employer directly in court without first filing a claim with DOL. Giving judges (often a small claims court judge) the discretion over whether to award the liquidated damages will severely undermine the value of the statute because they too often exhibit bias towards employers (or the attorneys who represent them) or are otherwise unsympathetic with an employee being beaten out of the wages that are due them. I take it from your comments and experience with the law that you primarily represent employers and not employees.
That’s accurate. So, my experience has primarily been with bad employees who finally got terminated who then turn around and make stuff up because they’re angry about losing their job and have a person grudge against their boss. Which definitely skews my opinion.
In my experience with representing employers, the possibility of attorneys fees was a strong driver to urge clients to pay the wages (and in my moral opinion but not neccessarily the legal opinion I advanced, do the right thing.)