Whether an employee can receive interest on unpaid wages depends on state laws. There are no federal provisions for unpaid wage interest, so it’s best to consult an experienced employment attorney who can assess your case and advise you based on your state’s applicable laws.
What Are Unpaid Wages?
Unpaid wages are money employers owe employees for work they have completed but didn’t get paid for. Failing to pay employees money they are legally owed for work done violates federal and state wage and hour laws.
Here are some examples of unpaid wages.
Unpaid overtime: Failing to pay eligible employees the required overtime rate (typically one and a half times their regular pay rate) for hours worked beyond 40-hours per week or eight hours per day in certain states.
Being paid below minimum wage: Paying employees less than the legally mandated minimum wage for their jurisdiction.
Off-the-clock work: Requiring employees to perform job-related tasks before or after their designated shift without compensation.
Illegal paycheck deductions: Making unauthorized deductions from employees’ paychecks for items like uniforms, equipment, or cash register shortages that reduce their earnings below the minimum wage or overtime thresholds is unlawful.
Misclassifying employees: Employers may incorrectly classify employees as independent contractors to avoid providing overtime pay, minimum wage, and employee benefits.
At Rowdy Meeks Legal Group LLC, we will vigorously pursue your rights for pay for all work you perfrom. We have the experience, resources, and track record to help you get the income you earn.
What Does the FLSA Say About Receiving Interest On Unpaid Wages?
The Fair Labor Standards Act (“FLSA”) doesn’t specifically address the payment of interest on unpaid wages. However, employers must pay employees for all hours worked, including overtime hours at the specified minimum wage and overtime rates.
If your employer fails to pay you for work done, you may have grounds for an unpaid wage claim under the FLSA. However, the FLSA has no provisions for paying interest on wages owed to employees.
State Laws and Interest On Unpaid Wages
Although the FLSA doesn’t have specific guidelines for unpaid wage interest, some states have their own wage and hour laws that make provisions for interest on unpaid wages.
In California, for example, you may be entitled to collect interest at 10% per annum on the unpaid wage amount. Illinois is another state in which employees may recover interest on unpaid wages.
Sometimes, the payment of interest is a penalty for employers who commit wage violations. The longer an employee goes without receiving already-earned wages, the longer they can accrue interest. The exact amount of interest earned varies by state. In some jurisdictions, instead of charging interest on an unpaid wage claim, they’ll assess “liquidated damages.” This amount is set in advance according to federal law and is typically double the unpaid wages.
Kansas State Laws
In Kansas, employers who fail to pay overtime must pay employees the full amount owed and reasonable attorney fees.
Employees can also seek the unpaid wage amount and statutory penalties if the employer has willfully withheld wages. The penalty accrues at 1% each day except Sundays and legal holidays. After the eighth day that payment is due, employees may qualify for up to a 100% penalty.
Rowdy Meeks Legal Group LLC: Wage, Hour & Overtime Violations
Employees who work hard and fail to receive their pay are often the victims of wage theft. However, many states have laws that require employers to compensate employees for unpaid wages, and pay penalties and interest.
Rowdy Meeks Legal Group LLC handles all aspects of unpaid wages, including state-sensitive issues like interest and penalties. Contact us today if you have questions about interest on unpaid wages owed to you.