Government Works to Ensure Compliance with FLSA
The U.S. Department of Labor (DOL) recently estimated that as much as 70% of all employers are out of compliance with the Fair Labor Standards Act. To date, $1.4 billion in back wages have been recovered by the DOL on behalf of over two million employees. Moreover, $252 million in settlements have been paid out by employers – in the top ten wage and hour settlements.
The DOL has received an 18% budget increase for 2010.
In addition, the IRS has instituted what they call “the National Research Program on employment tax compliance has focused their efforts on improper worker classification as well as “non-conforming benefits.” These are benefits that could be considered wages and therefore subject to employment taxes, i.e. personal use of company vehicles, employee discounts, educational assistance, etc.
The IRS will be looking at tax records for 2007 and 2008.