Posttermination promises to pay wage can extend limitations period

The statute of limitations for claims made under the Fair Labor Standards Act (FLSA) and the Arizona Minimum Wage Act (AMWA) is two years, but it can be extended to three years if an employee can show the employer willfully violated the statutes. The statute of limitations for unpaid wages under the Arizona Wage Act (AWA) is one year, as with other state employment contract claims. Sometimes employers and employees informally discuss resolving wage-related claims before employees take the formal step of filing a lawsuit (in situations in which the claims remain unresolved). In those discussions, be careful to avoid making certain promises you aren't willing to keep. Otherwise, you could potentially extend the period of liability for the wage claims.

Background

Four former employees of a home healthcare company sued the facility and its individual owners and managers, alleging that at some point during their employment the employer began making untimely and incomplete wage payments. In some cases, the facility reissued paychecks that were ultimately dishonored because of insufficient funds.

Following their separation, each employee attempted to resolve the wage claims against the facility. During the postemployment attempts to find a solution, one manager told them numerous times that both he and the facility would pay all wages owed.

When the issues weren't resolved, the employees filed suit. The employer sought dismissal of the lawsuit, citing the untimeliness of the claims—their employment had ended in 2017, but the suit wasn't filed until September 2019.