Penalties for violating the Fair Labor Standards Act (FLSA) and the Family and Medical Leave Act (FMLA) are increasing for 2023. In 2015, Congress passed a law requiring the DOL to adjust its civil monetary penalties for inflation each year in order “to improve the effectiveness of civil monetary penalties and to maintain their deterrent effect.” In accordance with this law, the DOL has issued a new rule increasing by 7.7% the civil money penalties for violations of the employment laws it is responsible for enforcing.
These increased penalties apply to any penalties assessed after January 15, 2023 as follows:
Other Increased Penalties
Notably, the DOL also adjusted penalties for violations of certain regulations under the Employee Retirement Income Security Act (ERISA), the Immigration and Nationality Act (regarding the H-2A, D-1 and H-1B visa programs), the Employee Polygraph Protection Act and the Federal Mine Safety and Health Act, among others.
Next Steps for Employers
To avoid costly penalties employers should audit their wage and hour practices, including confirming adherence to minimum wage and overtime requirements and proper classification of non-exempt and exempt employees. Employers should also audit their leave process and practices, including confirming that applicable notices explaining rights and responsibilities under the FMLA have been posted and are being provided to eligible employees.
Multistate employers must be aware of applicable state or local wage and hour and leave laws which may have additional requirements to ensure compliance with all applicable laws.