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When an employer fails to pay legally owed wages, workers have the right to seek recourse. The U.S. Department of Labor’s (DOL) Wage and Hour Division (WHD) enforces federal laws related to pay, including minimum wage and overtime.
This guide explains what constitutes unpaid wages under federal law, who can file a complaint, what information is needed, the filing process, what happens afterward, and the protections available to workers who assert their rights.
What Counts as Unpaid Wages Under Federal Law?
The primary federal law governing wage payment is the Fair Labor Standards Act (FLSA). Understanding its key provisions helps identify potential wage violations.
The Fair Labor Standards Act
The FLSA establishes crucial standards for most workers in the private sector and in federal, state, and local governments. These standards include the federal minimum wage, overtime pay requirements, recordkeeping obligations for employers, and rules regarding child labor. The Wage and Hour Division of the U.S. Department of Labor administers and enforces the FLSA.
The FLSA sets a baseline; many states have their own laws that provide additional protections or higher wage standards.
Minimum Wage Violations
Under the FLSA, covered, nonexempt employees must be paid at least the federal minimum wage for all hours worked. As of July 24, 2009, the federal minimum wage is $7.25 per hour. If an employee is subject to both state and federal minimum wage laws, they are entitled to the higher of the two rates.
For employees who receive tips, such as restaurant servers, employers may pay a lower direct cash wage (at least $2.13 per hour) and take a “tip credit” towards the minimum wage obligation. However, the employee’s tips combined with the direct cash wage must equal at least the full federal minimum wage.
If the combined amount doesn’t reach the minimum wage, the employer must make up the difference. Additionally, employees must generally retain all their tips, although valid tip pooling arrangements among tipped employees are permitted.
Overtime Pay Violations
The FLSA generally requires that covered, nonexempt employees receive overtime pay at a rate of not less than one and one-half times their regular rate of pay for all hours worked over 40 in a workweek.
A workweek is defined as a fixed and regularly recurring period of 168 hours – seven consecutive 24-hour periods – and it does not need to align with the calendar week. Averaging hours over two or more workweeks is not permitted; each workweek stands alone for overtime calculation purposes.
The “regular rate” includes all remuneration for employment, except for certain statutory exclusions. It is calculated by dividing the employee’s total compensation for the workweek (less exclusions) by the total number of hours actually worked in that workweek. This rate cannot be less than the applicable minimum wage.
The FLSA does not mandate overtime pay simply for working on weekends, holidays, or regular days of rest, unless the hours worked on those days push the employee over the 40-hour threshold for the workweek. While certain employees, such as some executive, administrative, and professional employees, may be exempt from overtime requirements, these exemptions are narrowly defined, and specific salary and duties tests must be met.
“Off-the-Clock” Work
Employers must pay employees for all “hours worked.” This generally includes all time an employee must be on duty, on the employer’s premises, or at any other prescribed place of work, from the start of their first main work activity to the end of their last main work activity.
A key principle is that work not requested but “suffered or permitted” is work time that must be paid for. If the employer knows or has reason to believe the employee is working, the time generally counts as hours worked.
Examples of time that may count as compensable hours worked include:
- Short rest periods (usually 20 minutes or less)
- Time spent “engaged to wait” (e.g., a receptionist waiting for calls)
- Time an employee is required to remain on call on the employer’s premises
- Attendance at mandatory lectures, meetings, and training programs related to the job
- Certain types of travel time, such as travel between job sites during the workday or travel for a special one-day assignment in another city (beyond normal commute time)
Bona fide meal periods (typically 30 minutes or longer) where the employee is completely relieved from duty are generally not considered hours worked and do not require compensation. Similarly, ordinary travel from home to work and back is typically not paid work time.
Illegal Deductions
Employers may sometimes make deductions from an employee’s wages. However, deductions for items considered primarily for the benefit or convenience of the employer (like the cost of required uniforms, tools of the trade, or cash register shortages) are illegal if they reduce an employee’s earnings below the required FLSA minimum wage or cut into legally required overtime pay.
Final Paycheck Issues
Federal law, specifically the FLSA, does not require employers to provide a departing employee with their final paycheck immediately upon separation. However, the wages earned are due on the regular payday for the pay period in which the employee worked.
If that payday passes and the employee hasn’t received their final wages, they should contact the WHD or their state labor department. Some state laws do have specific requirements regarding the timing of final paychecks, potentially requiring payment sooner than the next regular payday.
The FLSA does not mandate payment for benefits like severance, accrued vacation time, or sick leave upon termination; these are typically determined by employer policy or agreement, or potentially by state law.
Misclassification as Independent Contractors
Only “employees” are covered by the FLSA’s minimum wage and overtime protections. Sometimes, employers incorrectly classify workers as “independent contractors” when they are actually employees under the law. This misclassification can improperly deny workers their rights to minimum wage and overtime pay.
Whether a worker is an employee or an independent contractor depends on the “economic reality” of the relationship, considering factors like:
- The worker’s opportunity for profit or loss based on managerial skill
- The relative investments of the worker and employer
- The degree of permanence of the relationship
- The nature and degree of control exerted by the employer
- The extent to which the work performed is integral to the employer’s business
- The skill and initiative required
If the analysis shows the worker is economically dependent on the employer for work, they are likely an employee.
Who Can File a Complaint with the WHD?
Eligibility
Generally, any employee who believes their rights under the laws enforced by the WHD (including the FLSA) have been violated can file a complaint. This applies regardless of immigration status; the WHD enforces the law for all workers.
Eligibility extends to workers in the private sector as well as most federal, state, and local government employees, provided they are covered by the FLSA and not subject to specific exemptions. The focus is on the existence of an employment relationship; true independent contractors are not covered by the FLSA’s wage and hour protections.
Confidentiality
Workers may hesitate to file a complaint due to fear of repercussions. The WHD generally keeps the identity of the complainant confidential. While absolute anonymity cannot be guaranteed throughout the entire legal process (especially if litigation becomes necessary), the WHD does not typically disclose the complainant’s name or the nature of the complaint unless the worker agrees to the disclosure or it is necessary for the investigation or legal proceedings.
Protecting worker confidentiality is a priority to ensure employees feel safe reporting potential violations. Furthermore, the FLSA explicitly prohibits employer retaliation against workers who file complaints.
Information Needed to File a Complaint
To help the WHD investigate effectively, workers should be prepared to provide as much information as possible. Having detailed records strengthens a claim, although WHD can investigate even if records are incomplete.
Key Details
When filing a complaint, try to gather the following information:
- Your full name, address, and phone number
- The employer’s name, address (including specific worksite if different), and phone number
- The names of managers or supervisors involved
- The type of work performed
- The dates of employment
- Your rate of pay and how you were paid (e.g., hourly, salary, piece rate)
- How you received payments (e.g., check, direct deposit, cash)
- Details about the hours worked, including dates and times if possible. Keeping a personal log of hours can be very helpful.
- A clear description of the wage issue (e.g., not paid minimum wage, not paid overtime for hours over 40, illegal deductions, unpaid “off-the-clock” work, issues with final paycheck)
- Copies of any relevant documents, such as pay stubs, time sheets, employment contracts, or letters related to your pay
This information helps the WHD understand the situation and determine if a violation may have occurred. The DOL offers resources like a “How to File a Complaint” card in multiple languages that outlines the process.
Documentation
While providing documents like pay stubs and personal records of hours worked is extremely helpful (“proof of unpaid wages”), it is not strictly required to file a complaint. Employers are legally required to keep accurate records of wages and hours worked. WHD investigators can examine the employer’s records as part of their investigation.
However, any documentation the worker can provide makes the investigation process potentially faster and more effective. Even handwritten notes tracking work hours can be valuable.
How to File Your Wage Complaint with the WHD
The Wage and Hour Division offers several ways for workers to get information and file a complaint.
Contacting WHD
The WHD is the primary agency for federal wage issues. Workers can contact the WHD through its national toll-free helpline or visit its website for information:
- Toll-Free Helpline: 1-866-4US-WAGE (1-866-487-9243). Help is available Monday to Friday during business hours (typically 8:00 a.m. to 4:30 p.m. local time, though hours vary by region). Assistance is often available in multiple languages. For individuals who are deaf, hard of hearing, or have a speech disability, dial 7-1-1 to access telecommunications relay services.
- WHD Website: https://www.dol.gov/agencies/whd provides extensive information on worker rights, employer responsibilities, fact sheets, and contact options.
Filing Methods
Workers can typically initiate a complaint through several channels:
- Phone: Call the toll-free helpline (1-866-487-9243) to speak directly with a WHD representative who can guide the worker through the complaint process.
- Mail/Fax: Complaint forms may be available for download from the WHD website or requested via phone. Completed forms can often be mailed or faxed to the nearest WHD local office. The “How to File a Complaint” resources on the WHD website should provide details on forms and submission.
- In Person: Workers can visit a local WHD office to file a complaint. It’s advisable to call ahead, as some offices may have limited hours for in-person visits. A directory of local offices can usually be found on the WHD website under the “Contact Us” section.
- Online Contact: While a dedicated online filing portal may vary, the WHD website offers online contact options, which can be used for inquiries and potentially to begin the complaint process.
What Happens After You File a Complaint?
Once a complaint is submitted, the WHD follows a process to determine if a violation occurred and seek resolution if necessary.
Complaint Review
WHD staff will review the submitted information to determine if the issue falls under their jurisdiction (i.e., involves a law they enforce, like the FLSA) and if enough information has been provided to proceed. They may contact the worker if more details are needed.
Investigation Process
If the complaint is accepted, a WHD investigator will be assigned. The investigation typically involves:
- Examining Records: Reviewing the employer’s time and payroll records.
- Interviews: Conducting confidential interviews with the employer and potentially other employees to gather facts about pay practices and hours worked. The investigator maintains confidentiality regarding who filed the complaint to the maximum extent possible under the law.
Employer Contact
During the investigation, the WHD investigator will contact the employer, explain the process, and discuss the relevant laws and the specific issues raised in the complaint. Once the investigation is complete, the investigator will inform the employer of any violations found and what steps are needed for compliance.
Potential Outcomes
The outcome depends on the findings of the investigation:
- Back Wages Recovery: If violations resulting in unpaid wages are found, the WHD’s primary goal is to recover those wages for the affected employees. The WHD may supervise the payment of back wages. In addition to back wages, the WHD may also seek an equal amount in liquidated damages for the employees, effectively doubling the recovery.
- Litigation: If the employer refuses to comply and pay back wages, the Secretary of Labor has the authority to file a lawsuit against the employer to recover the wages and liquidated damages, and potentially seek injunctions to prevent future violations. An employee also has the right to file a private lawsuit under the FLSA for back pay, liquidated damages, attorney’s fees, and court costs. However, an employee generally cannot bring a private suit if the WHD has already supervised payment of their back wages or if the Secretary of Labor has already filed suit on their behalf.
- Penalties: Employers who willfully or repeatedly violate minimum wage or overtime requirements may face civil money penalties payable to the government. Penalties can also be assessed for child labor violations, with higher amounts for violations resulting in serious injury or death. Willful violations can even lead to criminal prosecution, potentially resulting in fines and imprisonment for repeat offenders. The FLSA also includes a “Hot Goods” provision, which allows the DOL to prevent the interstate shipment of goods produced in violation of wage, overtime, or child labor laws.
- No Violation Found: If the investigation determines that no violation occurred under the laws enforced by WHD, the case will be closed, and both the complainant and the employer are typically notified.
Timeline
There is no set timeline for a WHD investigation. The duration can vary significantly depending on the complexity of the case, the number of employees involved, the employer’s cooperation, and the investigator’s caseload. While WHD strives to complete investigations efficiently, patience is often required. Workers seeking updates can contact the assigned investigator or the local WHD office handling their case.
Workers Owed Wages (WOW) System
Sometimes, the WHD successfully recovers back wages for employees but cannot locate them to distribute the funds. The WHD holds these wages for three years while continuing efforts to find the workers. After that, the money is sent to the U.S. Treasury.
Workers who believe they might be owed back wages from a past WHD case can search the “Workers Owed Wages” (WOW) online system using their former employer’s name. If found in the system, workers can submit a claim form (WH-60) and proof of identity to receive their owed wages.
Protection Against Retaliation
A significant concern for workers considering filing a complaint is the fear of losing their job or facing other negative consequences from their employer. Federal law provides important protections against such actions.
FLSA Anti-Retaliation Protections
The Fair Labor Standards Act explicitly prohibits employers from retaliating against an employee because they filed a wage complaint, participated in a WHD investigation or proceeding, or otherwise asserted their rights under the Act. This protection is crucial because it allows workers to pursue their rightful wages without fear of punishment.
Examples of Illegal Employer Retaliation
Retaliation can take many forms. It is illegal for an employer to take adverse action against a worker because they engaged in protected activity (like filing a complaint). Examples of prohibited retaliation include:
- Firing or laying off the worker
- Demoting the worker
- Reducing the worker’s pay or hours
- Assigning the worker to less desirable shifts or tasks
- Intimidation, threats, or harassment
- Providing an unjustified negative performance review or job reference
- Blacklisting the worker (making it harder to find future employment)
Reporting Retaliation
Workers who believe they have experienced retaliation for filing a wage complaint or cooperating with an investigation should contact the WHD immediately. Retaliation is a separate and serious violation of the FLSA, and the WHD can investigate these claims as well.
Don’t Wait Too Long: Time Limits for Filing
There are legal time limits, known as statutes of limitations, for filing a lawsuit to recover unpaid wages under the FLSA. Acting promptly is essential to preserve the right to recover all wages owed.
The General Rule: 2-Year Limit
Generally, a legal action to recover unpaid minimum wages or overtime pay under the FLSA must be filed within two years from the date the wage violation occurred. This means WHD typically looks back two years from the date a complaint is filed (or the start of an investigation) to determine the amount of back wages owed.
When the Limit is 3 Years
If the employer’s violation of the FLSA was “willful,” the statute of limitations extends to three years. A violation is generally considered willful if the employer knew their conduct was prohibited by the FLSA or showed reckless disregard for whether it was.
Why It Matters
These time limits mean that delaying action can result in losing the right to recover older unpaid wages. For example, if a violation occurred 2.5 years ago and was not willful, the worker may no longer be able to recover those specific unpaid wages through an FLSA claim. Therefore, contacting the WHD or seeking legal advice soon after discovering a potential wage violation is important to maximize the potential recovery period.
Checking Your State Laws for Added Protection
While the FLSA provides a federal floor for wage protections, state laws often offer more benefits to workers.
Why State Laws Matter
Many states have enacted their own wage and hour laws that may be more generous than the FLSA. Examples of areas where state law might provide greater protection include:
- Higher Minimum Wage: Many states have minimum wage rates significantly higher than the federal $7.25 per hour. (See state examples: NJ $15.49 in 2025).
- Different Overtime Rules: Some states require overtime pay in situations not covered by the FLSA, such as for hours worked over 8 in a day.
- Meal and Rest Periods: Unlike the FLSA, some state laws mandate paid or unpaid meal or rest breaks.
- Final Paycheck Timing: State laws often specify deadlines for employers to issue final paychecks to separated employees, which may be sooner than the next regular payday.
- Payment for Accrued Vacation: While the FLSA doesn’t require payout of unused vacation time upon termination, some state laws do mandate it.
Entitlement to Higher Standard
When an employee is covered by both federal and state wage laws, the law that provides the greater benefit or stricter standard applies. For instance, if the state minimum wage is higher than the federal minimum wage, the employee must be paid the higher state rate.
How to Find Your State Labor Office
To learn about specific rights under state law, workers should contact their state’s labor agency or department of labor. The U.S. Department of Labor provides a resource page with links to state labor offices across the country.
Visiting the official website for the state’s labor department (e.g., New York, Colorado, North Carolina, New Jersey, Georgia, Illinois) or calling them directly is the best way to get accurate information about state-specific wage and hour protections and complaint procedures.
Understanding both federal and state rights ensures workers can advocate for the full compensation they are legally owed.
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