9th Circuit affirms double damages, interest awards for willful FLSA violations

The Fair Labor Standards Act (FLSA), the law that establishes federal minimum wage and overtime obligations, requires covered employers to pay most employees overtime compensation of at least 1.5 times their regular rate for hours worked over 40 in a workweek. It also allows a court to award "liquidated" damages in an amount equal to the unpaid overtime compensation unless the employer can prove that its decision not to pay overtime compensation was made in good faith and it had a reasonable basis to believe its conduct was proper.

In most cases, the FLSA has a two-year statute of limitations, meaning claims for unpaid overtime that arose more than two years before the lawsuit was filed are lost. In the case of "willful" violations, hwoever, that time limit is expanded to three years.

Those two provisions, liquidated damages and willfulness, were intertwined in a recent decision of the U.S. 9th Circuit Court of Appeals, the federal appellate court that has jurisdiction over nine western states, including Alaska, Arizona, Hawaii, Nevada, Oregon, and Washington.

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