Manufacturing Companies Commit Overtime Pay Violations

Migliaccio & Rathod LLP is currently investigating employers in manufacturing that violate labor laws by failing to pay employees proper overtime rates. According to the Fair Labor Standards Act (FLSA), all employees must be compensated for hours worked over 40 in a workweek according to their regular rate, which reflects all earnings, including bonuses and extra pay. When no additional non-discretional earnings are involved, an employee’s overtime pay can be simply calculated as 1.5 times the hourly rate. However, the FLSA outlines that, when employees earn non-discretional bonuses or other additional income, employers must calculate overtime payments as 1.5 times the “regular rate,” which includes these other forms of pay. The final overtime pay will therefore be higher than if the employer just calculated 1.5 times hourly rate.

These types of bonus payments are common for manufacturing workers and include:

  • Site Allowance
  • Stage Bonus
  • Shift Differential
  • Safety bonus
  • Production bonus
  • Performance award/bonus
  • Sign-On Bonus
  • Spotlight award (may be paid via gift card)
  • COVID pay
  • Other guaranteed pay or non-discretionary bonuses

For example, Migliaccio & Rathod LLP, with Sommers Schwartz, PC, has filed a class action lawsuit against JAC Products, Inc. over allegations that JAC committed overtime pay violations. The plaintiff alleges that she regularly earned non-discretional bonuses, including shift differentials and peak-demand pay at the height of the Covid-19 pandemic. However, JAC continued to compensate employees for overtime at their standard 1.5 times hourly rate, rather than the proper 1.5 times regular rate (which requires factoring in ALL additional earnings from these bonuses). As a result of JAC’s failure to include bonuses in employee overtime rates, the lawsuit alleges that JAC employees missed out on a subtle but substantial portion of owed wages.

Another recent complaint alleges that car seat manufacturer Grammer Inc. and its sister entity, Toledo Molding and Die LLC, failed to incorporate nondiscretionary bonuses in their calculations of overtime premium pay. The lawsuit demands compensation for the plaintiff, who was paid on an hourly basis and worked 40 to 60 hours a week, and other similarly situated workers who were shorted wages as a result of the overtime rate violation.

For more information on regular rate and common violations thereof, visit our other investigations on bonus and overtime calculations.

Do you work for a manufacturing company and work overtime? If your employer failed to include bonuses and extra pay in calculating overtime pay, you may be owed money.

If so, we would like to speak with you. Please complete the questionnaire linked below, send us an email at [email protected], or give us a call at (202) 470-3520 for more information.

Attorneys Committed to Fighting Wage Theft

The lawyers at Migliaccio & Rathod LLP have years of experience in class action litigation against large corporations, including in cases involving wage theft and unfair & deceptive trade practices. More information about our current cases and investigations is available on our blog.