The U.S. Equal Employment Opportunity Commission (EEOC) reported that in 2018 it resolved 90,558 charges of workplace discrimination and collected $505 million for victims. Retaliation was the most frequently filed charge, followed by sex, disability and race. What does this mean for employers? According to CERS (Cutting Edge Recruitment Solutions), the average out-of-court discrimination settlement for an employer is about $40,000 and the majority of cases are ruled in the plaintiff’s favor.
Ten percent of wrongful termination and discrimination cases result in $1 million settlements. Not all discrimination, though, deals with sex, disability or race. Another form of discrimination is when employers fail to offer benefits equally to all employees. For instance, granting special accommodations to one employee and not another — such as granting extra time off — can lead to inconsistencies, which can lead to lawsuits.
Make sure you apply policies equally when dealing with promotions, vacation, pay, assignments, awards, discipline and termination. You must pay your employees overtime if they work more than 40 hours per week. However, there is an exemption, and this is where it gets tricky. You do not have to pay exempt employees, and they do not qualify for minimum wage because they are paid for work performed, not for the hours they work.
There are strict guidelines as to who qualifies for status as an exempt employee, outlined by the federal government’s Fair Labor Standards Act and some state regulations. For an employee to be considered exempt, they must use their independent judgment in performing their duties at least 50 percent of the time and must earn more than $455 per week. An example of an exempt employee would be an executive who supervises at least two employees and makes decisions to hire or fire employees.