DOL Launches "PAID" Self-Audit Program for Potential FLSA Violations

The U.S. Department of Labor (DOL) Wage and Hour Division (WHD) has launched a new nationwide pilot program to facilitate the resolution of potential overtime and minimum wage violations under the Fair Labor Standards Act (FLSA) without litigation. The Payroll Audit Independent Determination (PAID) program allows employers to proactively self-audit to identify potentially non-compliant compensation practices.

To be eligible to apply to participate in PAID, employers may not currently be party to any litigation related to, be under investigation by WHD for, or have knowledge of complaints about compensation issues in the proposed self-audit. After WHD evaluates the employer’s self-audit and issues a summary of unpaid wages, employers are responsible for issuing payment of back wages to employee(s) by the end of the next full pay period.

Note that while resolution of back wages through PAID will release the employer from the FLSA claim, WHD may not supervise payments or provide releases for state law violations. Employees may choose whether or not to accept the payment of back wages due. The PAID program also does not waive WHD’s right to conduct any future investigations of the employer.

For more information, see the program homepage. The pilot will be evaluated after six months.