Wage and Hour Case Studies - Today's DOL Violation Trends
September 28, 2022
Wage and Hour Case Studies - Today's DOL Violation Trends

The U.S. Department of Labor’s (DOL) Wage and Hour Division (WHD) is tasked with enforcing employment laws that affect more than 148 million workers. The WHD enforces federal minimum wage, overtime pay, recordkeeping and child labor requirements of the Fair Labor Standards Act (FLSA), as well as the Family and Medical Leave Act (FMLA) and a number of other employment standards and worker protections. According to the DOL, the core enforcement obligations of the WHD’s investigators include conducting investigations to determine if employers are paying workers and affording them their rights as required by law; helping ensure that law-abiding employers are not undercut by employers who violate the law; promoting compliance through outreach and public education initiatives; and supporting efforts to combat worker retaliation and worker misclassification as independent contractors. In fiscal year 2021, the WHD collected $230 million in wages owed to 190,000 workers, the DOL reported.


Generally, the WHD will initiate an investigation after a current or former employee files a complaint. A WHD investigator may visit an employer to provide information about the application of and compliance with the laws administered

by the WHD. An investigator may also visit an organization to conduct interviews, examine time clocks and ensure all employment notifications are available to employees. Additionally, they may review up to three years of wage and hour records to determine whether there are any violations in an employer’s payroll practices.


In addition to complaints, the WHD selects certain businesses and industries for investigation. For example, the WHD often targets low-wage industries due to high rates of violations, the employment of vulnerable workers or rapid industry changes, such as growth or decline. Occasionally, several organizations in a specific geographic area will be examined.


At the start of 2022, the DOL announced an initiative to hire 100 additional WHD investigators, signaling a potential increase in enforcement in 2022 and beyond. This initiative means now is the time for employers to review their wage and hour practices to ensure compliance with all relevant laws.


This article contains case studies that explore the most recent, real-world examples of employers found to be in violation of wage and hour laws. The case studies include snapshots of violations and general guidance on how employers can prevent similar issues. Employers can examine these case studies to learn from the mistakes of others in comparable industries and avoid costly consequences.


Real-world Case Studies


TAMPA, FL—A DOL investigation uncovered child labor violations by a fast-food restaurant franchisee. The franchisee had to pay more than $12,000 in civil monetary penalties.


What went wrong:

  • The organization allowed 17 employees who were minors—between ages 14 and 15—to work past 7 p.m.
  • The organization also allowed minor employees to work more than three hours during a school day when doing so was not permitted.


----------------       

ROCHESTER, NY—A DOL investigation found that a health care agency failed to pay its home health care aids overtime wages. The organization was forced to pay more than $228,000 in back wages for the 260 affected workers.


What went wrong:

  • Although the organization paid its health care aids overtime for hours worked over 44, it failed to pay workers time-and-a-half wages for hours between 40 and 44 they worked per week.


----------------       


NEW ORLEANS—A DOL investigation discovered that two contractors misclassified their painters and drywall workers as independent contractors. The organizations were forced to pay more than $246,000 in back wages for 306 workers.


What went wrong:

  • One organization misclassified its workers as independent contractors.
  • The same organization also failed to pay workers time-and-a-half overtime wages after they exceeded 40 hours in a workweek and instead used their regular rate of pay.
  • Both organizations failed to maintain complete and accurate records of the hours their employees worked.
  • The DOL determined that a joint employment relationship existed between the two organizations and, as a result, they were both liable to pay back wages.


 ----------------           

ATLANTA—A DOL investigation found that the Georgia Department of Public Health wrongly disciplined and terminated an employee for absences protected under the FMLA. The department was ordered to pay more than $77,000 in back wages and reinstate the employee.


What went wrong:

  • The department denied the employee’s request for leave for an FMLA-qualified condition.
  • The employee’s denial of FMLA benefits resulted in wrongful discipline and subsequent termination.


  ----------------   


Avoiding Violations

As illustrated by the case studies, avoiding wage and hour violations isn’t always easy. Due to the complex nature of employment laws, compliance is an ongoing challenge for employers. Reviewing these laws and regulations infrequently or only a handful of times is rarely sufficient, but by reviewing these laws regularly, employers can keep their businesses compliant and their workers satisfied. Below is general guidance related to the issues discussed earlier, categorized by violation type.


Child Labor Violations

Hiring minors comes with greater employer responsibilities, as minors have a number of specific wage and hour protections. Failing to comply with laws protecting this worker segment can be particularly costly.


The DOL recently publicized investigations uncovering child labor law violations. The WHD’s recent investigations of three grocery store operators in Idaho and Oregon resulted in more than $240,000 in civil penalties and $114,382 in unpaid overtime and liquidated damages for 266 employees. From 2017 to 2021, the DOL identified more than 4,000 cases of child labor law violations, finding more than 13,000 youth-aged workers employed in a violation.


In the Tampa, Florida, case study detailed in this article, minors were allowed to work later and more often than permitted by law. All of these instances are violations of the child labor provisions of the FLSA. Perhaps this was due to a shortage of workers, and only minors were available for specific positions and hours. Despite challenges in the current labor market, employers must remain compliant with all relevant state and federal laws governing child labor.


Employers should also consider regularly consulting with attorneys to ensure policies and practices are up to date and compliant.


Overtime Violations

The FLSA requires employers to pay covered nonexempt employees overtime wages—at a rate of time-and-a-half—if they exceed 40 hours in a workweek. Some companies utilize a variety of tactics to avoid paying these wages, including those that are unlawful.


In this article’s Rochester, New York, case study, the health care agency maintained and followed a practice in which home health care aids were paid straight time until they had worked more than 44 hours in a week. However, these employees were eligible for overtime pay once they had worked more than 40 hours. This case study demonstrates the importance of properly constructed and regularly reviewed workplace policies and manager training. Consulting with experts and having them review policies prior to their enforcement could save employers tens of thousands of dollars down the line. According to the DOL, employers may also contact the WHD to ensure they understand their responsibilities and avoid similar violations.


Employee Misclassification

One of the most serious problems facing employers is the misclassification of employees as independent contractors. Under the FLSA, employees are entitled to basic workplace protections that do not extend to independent contractors, such as minimum wage, overtime pay, protected FMLA leave, antidiscrimination and antiretaliation protections, workers’ compensation and unemployment insurance. The WHD is responsible for determining whether an employee has been misclassified as an independent contractor. Employers who misclassify workers may be forced to pay back wages, liquidated damages, attorneys’ fees and costs.


In the New Orleans, Louisiana, case study examined in this article, one contractor misclassified its workers as independent contractors. The workers were paid straight-time rates for all hours they worked. Because these workers were employees, they should have been paid time-and-a-half wages after they surpassed 40 hours in a workweek. Both contractors were also required to keep complete and accurate records of all hours their employees worked. This case reveals the importance of correctly classifying workers at the outset of the relationship and ensuring accurate and complete records are kept.


Sometimes it can be difficult to determine whether a worker is an employee or an independent contractor. However, seeking legal advice in these situations can help curtail potential violations and costly mistakes.


FMLA Violations

The FMLA protects workers who need to take a prolonged absence due to a qualified family or medical reason. This law was enacted so employees could deal with serious and potentially unexpected life circumstances without losing their jobs. Yet, an employee can follow all proper procedures, and an untrained or uninformed manager may still violate the law, resulting in costly consequences.


In this article’s Atlanta, Georgia, case study, the Georgia Department of Public Health wrongly denied the employee’s request for FMLA leave, believing the employee’s condition did not qualify for leave. As a result of the denied leave request, the employee was disciplined and subsequently terminated due to absences related to their FMLA-qualified condition. Employers must be aware of conditions that qualify for FMLA leave to avoid wrongfully disciplining or terminating otherwise protected employees.


FMLA violations can be particularly costly, as they may involve paying back employees’ lost wages and reinstating lost benefits. Employers need to ensure managers, employees and other stakeholders understand their FMLA rights. This includes knowing how to submit FMLA requests, understanding situations that might qualify for FMLA leave and comprehending workplace guarantees that come with this leave (e.g., job protection). Understanding these details can help prevent wrongful termination and significant monetary penalties.

 

Conclusion

These wage and hour violation case studies demonstrate how easy it can be for an employer to face challenges related to wage and hour regulations. That’s why it’s so important for employers to seek professional guidance before making potentially costly decisions. By learning from these employers’ mistakes, others in similar industries can avoid major violations and prevent DOL audits.

Sign up for our newsletter.

The Benefits of Outsourcing HR: Save Time, Cut Costs, and Boost Engagement

October 24, 2025
When HR Is Overloaded, Your Business Feels It For many small to mid-sized businesses, HR is one of the most critical (and most overextended) functions. From payroll and benefits to onboarding and compliance reporting, administrative tasks can quickly consume your team’s time, leaving little room for strategic work that actually moves the business forward. Sound familiar? You’re not alone. A recent survey from Champions of Change: isolved’s Fourth-Annual HR Leaders’ Research Study found that 51% of HR leaders spend four or more hours a day answering repetitive questions. This time could be better spent on employee engagement, culture, and growth initiatives. When HR teams are pulled in too many directions, the consequences ripple across the entire organization, resulting in missed deadlines, frustrated staff, compliance risks, and ultimately, higher turnover. Why HR Leaders Consider Outsourcing Outsourcing HR isn’t just for businesses without dedicated HR teams. In fact, a survey of 1,000 HR decision-makers found that 76% could benefit from outsourcing certain tasks, even though only 54% currently have plans to do so. HR outsourcing allows organizations to offload both core and strategic tasks, including payroll, benefits administration, recruitment, onboarding, compliance support, performance management, employee relations, and workforce analytics, without adding headcount. This augmentation provides a multiplier effect: a small HR team can function like a much larger one, accomplishing more in less time. By leveraging experienced HR professionals through outsourcing, organizations can free up internal HR teams to focus on initiatives that directly impact business growth, such as talent development, employee engagement, and culture-building. Routine administrative tasks, when handled externally, no longer distract from these high-value priorities. The True Cost of Administrative Overload Overburdened HR teams don’t just affect your internal operations; they impact your employees’ experience. Inconsistent onboarding can create a rocky first impression for new hires. Delayed payroll or benefits questions lead to frustration and decreased trust. Compliance oversights expose your business to fines and legal risk. Even small inefficiencies add up. According to the National Association of Professional Employer Organizations (NAPEO), organizations that leverage an outsourced HR model achieve an average ROI of 27.2% per year, saving around $1,775 per employee while paying $1,395 per employee for outsourced services. That’s not just cost savings, it’s a reinvestment in your team and your business. The Power of Strategic HR Outsourcing Outsourcing doesn’t mean giving up control or handing HR off to a faceless provider. Done strategically, it’s about extending your team. Administrative tasks like payroll, benefits, onboarding, and reporting can be handled efficiently by experts, while HR teams gain confidence that compliance requirements are being met. Most importantly, it frees internal HR to pivot from reactive, day-to-day tasks toward engagement, culture-building, and retention strategies. Outsourced HR support can scale with your business, providing additional expertise during busy periods, leaves of absence, or rapid growth phases. The impact is clear. Teams feel supported, employees feel heard, and the organization operates smarter, not harder. With the right outsourcing partner, a small HR team can act like a team of 10, and a team of five can perform like a team of 25, all while maintaining compliance and efficiency. Retention Starts With the Right Employee Experience When administrative burdens are reduced, HR teams can focus on creating meaningful experiences for employees. Transparent processes around pay, benefits, and policies build trust. Faster, more organized onboarding leaves a strong first impression. Access to modern self-service HCM tools empowers employees to manage their own information, reducing repetitive questions and improving engagement. By leveraging experienced HR professionals to handle gaps in internal processes, organizations can enhance overall employee satisfaction, ensuring every interaction, from onboarding to open enrollment, feels seamless and supportive. A Smarter Approach to HR Means a Stronger Business Across industries, companies are recognizing that HR outsourcing is no longer a luxury. It’s a strategic advantage. Organizations that adopt a blended model of technology and advisory support report measurable reductions in administrative workload, cost savings compared to maintaining fully in-house HR teams, and improved engagement for employees. Strategic HR outsourcing allows internal teams to shift from transactional tasks to big-picture initiatives, creating a more resilient, efficient, and high-performing workforce. At the end of the day, HR isn’t just a function; it’s the backbone of your organization. When it’s overextended, the entire business suffers. But with the right support, HR teams can focus on meaningful initiatives, employees feel more valued, and the business benefits from measurable ROI. Strategic HR outsourcing isn’t about replacing your team, it’s about empowering it. Your people, your culture, and your bottom line all benefit. Curious how Simco's HR Advisory services can help your business? Let's talk today.

Your Medicare Plan Is Discontinued: What’s Next?

October 14, 2025
If you recently received notice that your Medicare plan, or Medicare Advantage plan, is being discontinued, you’re not alone. Across the country (and right here in New York), insurers are scaling back or exiting less profitable markets ( Kiplinger ). While this can feel stressful, there are steps you can take to make sure your coverage doesn’t lapse and to find a better plan for your health and budget. Why Are Plans Being Discontinued? A mix of financial pressure, federal reimbursement changes, and rising health costs is driving insurers to reduce their Medicare Advantage footprints: Some major insurers are cutting back or exiting entire counties. For example, UnitedHealth announced it will discontinue its Medicare Advantage presence in 109 U.S. counties in 2026, according to Reuters . Local carriers in New York are also making changes: MVP is dropping several plans, and CDPHP is eliminating certain drug-coverage options, the Times Union explains . These shifts are happening alongside tighter government funding and increased regulatory strain. Because insurers must absorb the extra cost of covering benefits while meeting regulatory caps (for example, on prescription drug out-of-pocket limits), some plans become financially unsustainable and are discontinued ( the Kaiser Family Foundation ). Steps to Take if Your Plan Is Discontinued Here’s how to act so you don’t lose coverage: 1. Review the notice you received carefully Your insurer is required to send you a non-renewal or discontinuance notice. It often includes deadlines, whether you can enroll through a Special Enrollment Period (SEP), and what options you have. 2. Note the relevant enrollment period The Annual Enrollment Period (AEP) runs October 15 to December 7, 2025 , during which you can switch Medicare Advantage or Part D plans. If your plan was discontinued, some notices allow you to select a new plan until December 31 without penalty. In limited cases, you may qualify for a Special Enrollment Period (SEP) following the discontinuation. 3. Research your options early Don’t wait until the last minute. Compare plans available in your area. Key things to look at: Provider networks: Will your doctors still be covered? Drug formularies: Does the plan cover your medications and at what cost? Premiums, deductibles, and out-of-pocket max: These can vary significantly. Benefit trade-offs: Some plans reduce supplemental benefits (vision, dental, wellness perks) when trying to maintain financial viability. 4. Enroll in the new plan Submit your enrollment by the relevant deadline (typically December 7 for the Annual Enrollment Period (AEP). However, If your plan was discontinued, you may have until December 31 to choose a new one without penalty). Make sure the new plan starts January 1 to avoid coverage gaps. 5. If your plan wasn’t discontinued, still review Even if your current plan remains active, benefits, networks, and costs often change each year. It’s wise to compare alternatives anyway, especially after insurer shake-ups. Why Timing & Support Matter Delays cost you: Failing to enroll by deadlines could mean losing drug coverage or being locked into a less ideal plan. Support can ease the burden: Licensed agents can help you compare side-by-side, explain trade-offs, and guide you through enrollment. You deserve the best match: Everyone’s health and financial needs differ. Don’t settle for the first available option unless it truly fits. How Simco Can Help At Simco, we understand the stress of sudden plan changes. Our licensed insurance advisors are ready to: Help you interpret your discontinuance notice Compare plan options available in your area Assist with enrollment paperwork Explain benefit trade-offs and cost implications You don’t have to navigate this alone. Whether your Medicare Advantage plan was discontinued or you’re simply exploring your options, our team is here to support you. Contact us today to schedule a 1-on-1 consultation, and let us help you find the plan that keeps you covered and confident in 2026 and beyond.

isolved Named #1 for SMBs Across the Employee Lifecycle

October 3, 2025
At Simco, we’re proud to be a trusted isolved Network Partner , which means the Human Capital Management (HCM) technology we deliver to our clients is powered by isolved People Cloud™. And now there’s even more reason to celebrate: isolved has been recognized as the #1 SMB HCM provider across the entire employee lifecycle in Sapient Insights Group’s 28th Annual HR Systems Survey. This annual survey is one of the most respected benchmarks in the HR technology industry. With feedback from over 4,500 HR professionals, Sapient Insights captures the real voice of the customer by evaluating vendors across two critical areas: User Experience (UX) and Vendor Satisfaction (VS). isolved earned an impressive 38 badges this year, the most awarded SMB vendor for the second year in a row, and ranked #1 in 13 different SMB categories . Breaking Down the Results isolved’s recognition wasn’t limited to a single function. It spanned the entire employee lifecycle, covering everything from payroll and benefits to recruiting and workforce management. Highlights from the survey include: Payroll — Ranked #1 in both User Experience and Vendor Satisfaction for SMBs Core HR — #1 in Vendor Satisfaction Benefits — #1 in User Experience Recruiting — #1 in both User Experience and Vendor Satisfaction Time & Attendance — #1 in both User Experience and Vendor Satisfaction Skills Management — #1 in User Experience Rewards & Recognition — #1 in User Experience In addition, isolved placed in the Top 5 across numerous other categories like onboarding, learning, performance management, workforce scheduling, and contingent management. What does this mean? isolved’s solution isn’t just strong in one area, it’s consistently delivering across all the areas that matter most for small and mid-sized businesses. Why This Matters for SMBs Today’s SMBs face more challenges than ever. Recruiting is competitive, employee expectations are higher, and compliance requirements grow more complex every year. Business owners often find themselves piecing together multiple vendors to handle payroll, HR, benefits, and insurance, adding complexity and risk. isolved’s sweep across the Sapient Insights report shows that SMBs no longer have to choose between great payroll software and effective talent tools, or between benefits management and workforce scheduling. With isolved, the technology already covers the full employee lifecycle, validated by real-world HR pros. From Recognition to Results isolved’s 38 badges and top rankings validate what our clients experience every day: Accuracy and trust in payroll with fewer errors and compliance risks. Simplified benefits administration that keeps employees happy and businesses competitive. Recruiting and onboarding tools that make hiring more effective. Time and scheduling solutions that align workforce needs with operational efficiency. These results aren’t just about technology; they’re about enabling SMBs to compete, thrive, and support their people better. The Simco Advantage: More Than Just Software Here’s the ultimate key: technology is only half of the solution. Technology is powerful, but the real impact comes from how it’s put into practice. At Simco, we go beyond simply providing software. We deliver a fully integrated HCM and advisory solution that ties every part of workforce management together. Here’s what sets us apart: One Point of Contact: A dedicated resource who understands your business and ensures your HCM, HR, benefits, insurance, and retirement services work in sync. All-in-One Partner: From payroll and HR to insurance and 401(k) plans, we eliminate the hassle of juggling multiple vendors. Advisory + Optimization: We don’t just implement technology. We guide you in using it to strengthen compliance, employee engagement, and growth strategies. As your business grows, your needs change. By pairing isolved’s award-winning technology with Simco’s hands-on expertise, we help you stay ahead, operate more efficiently, and build better employee experiences. Key Takeaways isolved’s recognition in the Sapient Insights report shows that SMBs have access to enterprise-grade HR technology tailored for their needs. And with Simco as your partner, you’ll never have to choose between the strength of your platform and the quality of your service; you’ll have both. Want to see how Simco + isolved can streamline your payroll, HR, benefits, and more? Contact us today.

Have a question? Get in touch.