Receiving payment for work performed is the essential bargain of employment relationships. Employers benefiting from employees’ work have expressly or implicitly agreed to this, but in some instances, North Carolina employers fail to hold up their end of the bargain. Assuring proper employee compensation is of such economic importance that the North Carolina General Assembly has enacted the North Carolina Wage and Hour Act to rectify employer improprieties. If your business pays employee wages in North Carolina, take a few minutes to familiarize yourself with some details of the Act.
What Is the North Carolina Wage and Hour Act?
The North Carolina Department of Labor states that an employer must pay its employees at least the minimum wage ($7.25 per hour) for all hours worked. With some exceptions, an employer also must pay overtime when an employee works more than 40 hours in a 7 day workweek set by the employer. Overtime is usually paid at one-and-a-half times or 150% of the regular hourly rate of pay that the employee receives.
The obligation to pay employees fairly comes from:
- The North Carolina Wage and Hour Act
- The federal Fair Labor Standards Act (FLSA)
- Any agreements between you and your employee in writing
Protected Wages
The North Carolina Wage and Hour Act states that an employer must pay all wages an employee earned on the regular payday in which they are due. These wages must also include any accrued overtime compensation and bonuses and commissions outlined in the terms of employment with the business or company. Paid vacation and tips are also considered protected wages, as long as they are included in the terms of employment. Employers must also pay their employees on regular payday increments such as bi-weekly or monthly.
Employment Benefits
Any benefits compensating the employee for work must be proivded. These benefits can include:
- Pay commissions bonuses
- Holiday pay
- Sick leave
- Mileage expenses
- Vacation pay
- Overtime rates that apply before the 40-hour workweek has been met, such as overtime pay on weekends
The majority of these listed benefits must be earned before the employer is required to pay them. However, the employer is required to pay all benefits once earned.
Suing for Payments That Do Not Meet the North Carolina Wage and Hour Act Requirements
If the requirements of applicable laws are not met, the law allows an employee to sue the employer for incorrectly paid wages. The employee can also file a charge with the federal or state Department of Labor.
Government Complaints and Lawsuits
An employee may file with the N.C. Department of Labor (NCDOL) OR the federal Wage and Hour Division (WHD). Employees have one year to file a complaint with the NCDOL, and two years to file a WHD complaint. A third option is to file a lawsuit for unpaid wages.
Generally employers are prohibited from taking adverse employment actions against employees for their assertion of legislatively protected rights. Wage and Hour claims are no different, and an employer who retaliates may also face a Retaliatory Employment Discrimination Act in North Carolina.
What To Expect If a North Carolina Wage and Hour Act Claim Goes to Court
If an employee is not being properly compensated by their employer, the employee can initiate a legal action in North Carolina court. As with any legal action, hiring a knowledgeable attorney will help the employee prosecute their case.. Employees with successful claims may receive unpaid wages and accrued interest from the date on which the wages should have been paid. It is also possible for the court to award “liquidated damages” equal to the unpaid wages, effectively doubling the recovery the employee receives. Liquidated damages are not available where the employer proves the refusal to pay is supported by reasonable grounds the employer believed to be legal at the time.
We Are Here For Your Wage and Hour Concerns
At Anderson Jones, PLLC, advocating for the interests of our clients is a top priority. Conveniently located in Raleigh, NC, we have been assisting clients with workplace disputes for years. Do not hesitate to contact us regarding wage and hour questions or concerns.