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Trends in Wage and Hour Settlements: 2019 Update
04 June 2020
Dr. Stephanie Plancich and Janeen McIntosh
Associate Director Dr. Stephanie Plancich and Consultant Janeen McIntosh track trends in wage and hour settlements over the past 10 years, looking across industries, types of allegations, and states, in their newly released report, “Trends in Wage and Hour Settlements: 2019 Update.” This update adds five years of data to the civil wage and hour settlement study last released in July 2015, expanding NERA’s database to nearly 1,000 wage and hour settlements through December 2019.
The authors identify trends in settlements that have underlying allegations including misclassification of employees, failure to provide meals and/or breaks, working off-the-clock, tip pooling, and/or time spent donning and doffing protective equipment. Cases alleging one or more of these violations may be brought under state law or the federal Fair Labor Standards Act (FLSA) by current and/or former employees who seek compensation for unpaid hours.
Their findings include the following highlights:
- There were 92 wage and hour settlements in 2019, a 26% increase from the 73 cases settled in 2018.
- The average settlement value per case also jumped in 2019, with these cases settling for an average of $8.2 million as compared to the average settlement of $5.0 million in 2018.
- Overtime violations remain the most common allegation in our settlement data, consistently accounting for about 40% of settled cases across the entire 2010–2019 period.
- An increase in the proportion of settlements involving minimum wage allegations occurred in the last five years, with a corresponding relative decrease in settlements with off-the-clock allegations.
- Over the past decade, the Retail Industry has consistently had high annual aggregate settlement dollars and average settlement values per case. However, due to several large outlier settlements in the Transportation/Shipping Industry in 2015 and 2016, this industry had the largest proportion of total settlement dollars over the past decade.
Experts in NERA’s Labor and Employment Practice frequently provide economic and statistical analysis for wage and hour litigations. We have substantial experience investigating the key issues at the class certification, liability, and damages phases of cases involving all major types of wage and hour litigation. For information about this report, or to discuss how NERA can assist your firm, please contact the authors.