Trends in Wage and Hour Settlements: 2011 Update

22 March 2012
Dr. Denise Martin, Dr. Stephanie Plancich, and Janeen McIntosh

Cases alleging wage and hour violations are an ongoing source of potential liability for employers in the United States. A significant number of these cases continue to be filed, both in state and federal court, and companies continue to pay substantial settlements. In this update to NERA's ongoing analysis of settlements in wage and hour cases, Senior Vice President Dr. Denise Martin, Vice President Dr. Stephanie Plancich, and Senior Analyst Janeen McIntosh expand their analysis to include cases settled in 2011. The authors find that aggregate settlement amounts for wage and hour cases have decreased in 2011: the mean settlement amount was $4.6 million for cases settled in 2011, lower than the mean in the prior four years. However, the pattern is different after controlling for the number of plaintiffs in the class and the length of the class period. The average per-plaintiff settlement amount has remained relatively steady at approximately $5,000 from 2009-2011, and the average per-plaintiff per-class period year settlement has increased from approximately $900 in the 2007-2010 period to $1,500 in 2011.