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BOP NEWSLETTER • August 2024

Washington's Employee-Friendly Travel Time Rules Trigger Big Settlement

The Boeing Company has agreed to pay $11.5 million to 495 employees whom it had not properly compensated for out-of-town travel, following an investigation by the Washington State Department of Labor & Industries (L&I).

The enforcement agency said it was the largest amount of back pay returned to workers in its history.

“Work travel is still work – and we want to ensure Washington businesses understand what they owe to their workers who are on the road,” L&I Director Joel Sacks said.

Washington’s wage and hour laws are much stricter about out-of-town travel than the federal Fair Labor Standards Act (FLSA).

Under Washington state law, all travel time related to work is compensable regardless of the number of hours or when the travel takes place. It also includes any time necessary to get to an airport, train station or other transit center necessary to complete the out-of-town travel. Employees not only must be paid their wages for this time, but also must be paid overtime for any hours beyond 40 in a workweek and accrue paid sick leave.

The Department of Labor awarded one of the largest wage and hour judgements ever.

A Pennsylvania federal court awarded $35.8 million in overtime back wages and liquidated damages to 6,000 current and former workers across fifteen facilities in what it claims to be “one of nation’s largest FLSA judgments.”

In its Findings of Fact and Conclusions of Law, the court began by emphasizing that the Fair Labor Standards Act “mandates that each covered employee receive a ‘fair day’s pay for a fair day’s work.’” However, the “overwhelming evidence” confirmed that the defendants had “created and oversaw a system whereby employees who had worked a fair day, and often more, did not receive their fair day’s pay.”

Specifically, the Department of Labor put forth evidence of years of FLSA violations, including:

  • Willfully failing to pay employees for all hours worked, including work done during meal breaks.
  • Failing to incorporate all promised compensation, including non-discretionary bonuses and shift differentials, when calculating overtime pay.
  • Avoiding paying overtime by incorrectly treating employees as exempt from the act’s overtime requirements.
  • Not keeping accurate records of hours employees worked and compensation due for those hours.

These were not “occasional, innocent payroll errors,” noted the court. Instead, the defendants “created and intentionally maintained a system through which employees were consistently, systematically, and willfully subjects to payroll practices that did not remotely comply” with the law. The result was an “adversarial payroll system where employees were regularly shortchanged amounts owed — their ‘fair day’s pay’ — then forced to ‘fight’ and ‘battle’ to receive just compensation,” which led employees to “simply give up.”

The court concluded that the defendants acted “willfully–if not maliciously” and the court was “compelled” to hold them accountable for their willful, flagrant violations.”

The court entered an order for $17,902,219.10 in back wages due and another $17,902,219.10 in liquidated damages due.