Wage & Hour Watch: Cheerleader Lawsuits and Hypocrisy on Intern Pay

By John E. Thompson

Some recent headline items touch upon matters of continuing concern when it comes to wage & hour issues:

Hypocrisy on minimum wage

The Employment Policies Institute has highlighted what it calls Maximum Hypocrisy on the Minimum Wage among 96 percent of the Senate and House sponsors of bills to raise the federal Fair Labor Standards Act‘s current rate.

According to EPI, this is the proportion of increase-supporting legislators who do not pay their interns. One of them is Iowa Sen.Tom Harkin, principal sponsor of the Senate measure, who has been among the most-visible proponents of the bills and who has castigated those of a different view in harsh terms.

This newest flap brings to mind our earlier post on public pressure designed to goad the White House into paying interns. President Obama is, of course, another staunch proponent of a minimum-wage hike.

But a larger point is that the steady drumbeat of intern-related publicity probably signals trouble ahead for at least some organizations venturing into these arrangements. And it is worth recalling that some current lawsuits include claims, not only by unpaid interns, but also by interns who allege that, despite receiving “stipends” and the like, they were unlawfully underpaid.

The Viacom/MTV intern issue

In this same connection, a former unpaid intern who has sued MTV and Viacom under the FLSA and New York law is now seeking permission to send notices to potential plaintiffs who might opt-in to the FLSA claims.

Organizations considering internship programs will find the intern’s supporting factual allegations (in Ojeda v. MTV) to make for enlightening reading.

Raiders’ cheerleader sues over pay practices

A member of the Oakland Raiders’ cheering squad, “The Raiderettes,” has filed a class-action lawsuit under California law (Lacy T. v. Oakland Raiders) claiming that the team’s compensation practices were unlawful in a variety of ways.

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Comments attributed to her counsel suggest that they believe millions of dollars to be at stake. It might well be just a matter of time before allegations of unlawful pay practices are raised under the FLSA in analogous scenarios, whether in California or in other jurisdictions.

Whether anything illegal actually occurred remains to be determined. Even so, one lesson an employer should draw from this is that, when it comes to wage-law matters, management cannot take comfort simply in what employees might initially want to do or what they agree to in a contract.

Labor Secretary cheerleads for minimum wage hike

One of the foremost promoters of an increase in the FLSA minimum wage has been the U.S. Department of Labor, especially Labor Secretary Tom Perez. Secretary Perez’s Jan. 23, 2014 blog post concluded with the exhortation, “It’s time Congress acted to #raisethewage,” which refers to a social site maintained by the Labor Department.

Even apart from the broader policy implications of a federal agency’s ceaselessly advocating one side of a pending legislative matter as to which there is considerable public disagreement, it is not readily apparent how the DOL’s activism squares with the recent federal appropriations law. Division H, Title V, Section 503(a) of Public Law No. 113-76 says in relevant part:

No part of any appropriation contained in this Act shall be used . . . for publicity or propaganda purposes, for the preparation, distribution, or use of any . . . publication [or] electronic communication designed to support or defeat the enactment of legislation before the Congress . . ., except in presentation to the Congress . . . itself . . ..” [Emphasis added].

In light of both frenetic pre-passage wrangling and the complexity of the final legislation, perhaps the Department of Labor is unaware of this limitation.

This was originally published on Fisher & Phillips’ Wage and Hour Laws blog.

John Thompson is a partner in the Atlanta office of the law firm Fisher & Phillips. His practice focuses on wage and hour law, assisting employers in preventive efforts designed to ensure compliance, and he handles both investigations conducted by government agencies and litigation in the wage and hour area. John has served as a Special Assistant Attorney General for wage-hour matters for the State of Georgia. Contact him at jthompson@laborlawyers.com.

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