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Willfulness, Good Faith, and the Fair Labor Standards Act and North Carolina Wage and Hour Act – North Carolina Employee Wages and Salary Attorney

The Fair Labor Standards Act establishes minimum wage, overtime pay, and youth employment standards. Covered, nonexempt employees are entitled to a minimum wage of at least $7.25 per hour and are entitled to overtime pay of at least one-and-one-half times the regular rate of pay after a 40 hour workweek. North Carolina laws require identical pay practices but North Carolina wage and hour laws have additional standards for record keeping and other pay requirements for an employer. If you/your fellow employees are having a dispute with your employer about unpaid minimum wage, bonuses, commissions, overtime, or any other wage problem contact employment attorney Karl S. Gwaltney at 919.960.1545 or through email at

The North Carolina and Federal Department of Labor’s investigators gather data on wages, hours, and other employment conditions or practices to determine whether an employer is complying with state and federal labor laws. Unlike other employment violations, an employee with unpaid wages, commissions, bonuses, or other unpaid pay can sue an employer directly.

Employers violating the FLSA’s or North Carolina Wage and Hour Act’s minimum wage or overtime requirements may be forced to pay an employee’s unpaid overtime compensation or minimum wages (or both), and a court can also require an employee to pay liquidated damages. Liquidated damages is essentially “double damages,” requiring payment of an additional amount of money equal to wages found to be due.

It is important to quickly speak to a wage attorney about your unpaid wages, bonuses, or commissions. Generally, a lawsuit for unpaid minimum wages, overtime, or other compensation has a two-year statute of limitations. However, if a jury finds the employer’s wage violation was willful, a three-year statute of limitation will apply. An employee bears the burden of proving by substantial evidence that the employer knew it was violating wage laws or acted in reckless disregard as to whether the employee was violating wage laws. Reckless disregard is defined as “the failure to make adequate inquiry into whether conduct is in compliance with the Act.”

An important element to a North Carolina or Federal wage claim is liquidated damages. Liquidated damages allows an employee to be awarded twice the amount they are owed, whether paid by commissions, bonuses, overtime, or minimum wages. The Portal-to-Portal Act amended the Fair Labor Standards Act and created a provision that allows an employer to avoid paying liquidated damages if the employer establishes it acted in good faith under the reasonable belief that it was in compliance with wage laws. The clause states “if the employer shows to the satisfaction of the court that the act or omission giving rise to such action was in good faith and that he had reasonable grounds for believing that his act or omission was a violation . . . the court may, in its sound discretion, award no liquidated damages.”

This provision allows a judge discretion in assessing whether liquidated damages should be awarded to an employee. An employer who violates Federal wage laws or North Carolina wage laws maintains the burden of proving it is entitled to protection by showing that it acted with both objective and subjective good faith. Subjective good faith can be shown if the employer had “an honest intention to ascertain what [wage laws] require and to act in accordance.” In addition, an employer must also show objective good faith, i.e., that the employer had reasonable grounds for believing its conduct comported with wage and hour laws. Ignorance of the law is not an excuse. If an employer cannot show both subjective and objective good faith, liquidated damages are mandatory.

Having a jury or a judge determine the statute of limitations or whether double-damages should be awarded in your wage claim can make or break a case. When deciding whether to proceed with a claim for unpaid wages, bonuses, or commissions, contact the unpaid wage and labor attorneys at Maginnis Law, PLLC. Determining whether you have a claim for unpaid compensation requires an intensive inquiry into the employer’s pay practices. If you are wrongly denied pay from your employer, contact Raleigh unpaid wage and overtime lawyer Karl S. Gwaltney at 919.960.1545 for a free consultation regarding your rights. Maginnis Law, PLLC is a Raleigh firm handling employment cases dealing with unpaid wages and overtime throughout Wake County, Cary, Apex, Durham, Vance County, and Henderson. The firm takes certain wage and hour/overtime cases throughout North Carolina, particularly when groups of workers are involved. Contact the firm to discuss your overtime claim today or submit a confidential new case inquiry here.