16.72 DAMAGES: WILLFUL VIOLATION
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FAQ
I. What Are Liquidated Damages Clauses? Liquidated damages are contractual clauses used in a variety of contracts to set a fixed amount of damages to be paid in the event of a breach.
Section 11 good-faith defense. The section 11 good-faith defense allows a judge to reduce or eliminate an award of liquidated damages if the employer shows that its actions were taken in good faith and that the employer had ?reasonable grounds for believing? its actions did not violate the FLSA. 29 U.S.C. § 260.
But in addition to back pay, employees may recover what are referred to as ?liquidated damages? under the FLSA. Under the FLSA, liquidated damages are an amount equal to the pay employees should have received. In other words, employees can recover double ?back pay? damages for unpaid overtime.
In cases where an employee is subject to both state and federal minimum wage laws, the employee is entitled to the higher minimum wage.
To avoid liquidated damages, employers must show that (1) their actions were taken in good faith and (2) they had reasonable grounds for their belief that they were complying with the FLSA. (See 29 U.S.C. § 260).
Section 11 good-faith defense. The section 11 good-faith defense allows a judge to reduce or eliminate an award of liquidated damages if the employer shows that its actions were taken in good faith and that the employer had ?reasonable grounds for believing? its actions did not violate the FLSA. 29 U.S.C. § 260.
A contractual provision requiring a party in breach to pay a pre-determined amount to the other party as compensation for the breaching party's failure to perform a specific task or comply with a particular duty or obligation.
Willful violations of the FLSA may result in criminal prosecution and the violator fined up to $10,000. A second conviction may result in imprisonment.