Last week the Wage and Hour Division of the United States Department of Labor (“WHD”) made a significant announcement concerning the available damages in administrative proceedings. 

In a field assistance bulletin it published online, the Department of Labor withdrew the prior administration’s guidance on liquidated damages in administrative hearings and clarified that, effective immediately, WHD “may not seek or collect the payment of liquidated damages in any administrative matter under the Fair Labor Standards Act.”  This means that in the administrative setting, the range of damages that the WHD will supervise will be limited to the recovery of unpaid minimum wage or overtime compensation.    

The DOL made this decision in light of its conclusion that it lacked the statutory authority to supervise the payment of liquidated damages outside of court.  But now that the DOL has changed course, the important takeaway is that this change is meant to encourage earlier resolution of FLSA claims in the administrative setting.  In the event a matter does not resolve in the administrative setting, then the DOL can still seek liquidated damages in court.       

For more information about this alert, please contact Ian Gillen at 609.895.7066 or igillen@foxrothschild.com, or any member of the firm’s national Labor & Employment Department.