Business owners, executives, and managers need to pay attention to wage and hour compliance or risk personal liability. In a recent ruling under federal and New Jersey wage and hour law, a managing director with some ownership interests in several pawn shops was held personally liable for upwards of $2 million for wage violations. Here’s what business leaders can learn from this class-action lawsuit, and six ways to shield yourself and your company.
Manager Found Personally Liable
This class-action lawsuit involved 18 former employees alleging wage violations of the Fair Labor Standards Act (FLSA) and the New Jersey Wage Hour Law (NJWHL).
US District Judge William J. Martini held that the managing director of the Perfect Pawn was an “employer” within the meaning of the FLSA and NJWHL. The court also found that the director violated federal and state wage and hour laws by:
While this case involves an extreme example of a manager who ignored clear warnings and knowingly violated wage laws, it highlights the risks that could apply broadly to individuals responsible for business operations and payroll. Even unintentional mistakes in classifying workers or calculating pay can lead to significant violations with serious and costly consequences....
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