'Similarly situated' employees can collectively sue for unpaid wages

The federal Fair Labor Standards Act (FLSA) requires employers to pay minimum wage as well as overtime to eligible employees who work in excess of 40 hours per week. Employees who are denied those rights can sue their employers for unpaid wages, not only on behalf of themselves but also on behalf of other "similarly situated" employees. This is called a collective action.

How an FLSA collective action works

To be part of an FLSA collective action, one must opt into the class. This is unlike Federal Rule of Civil Procedure 23 class actions, in which class members must be given notice and an opportunity to affirmatively opt out. Also unlike class action notices you may have received in the mail in which you discover, to your pleasant surprise, that you are part of a class that has been in litigation for years, entitling you to a small portion of a settlement sum, FLSA collective actions can financially destroy a company.