Private Attorney or Labor Board: Pros and Cons

In order to enforce the federal Fair Labor Standards Act (FLSA) and similar state laws, both the federal and Colorado state governments have set up departments of labor (also known as “divisions of labor” or “labor boards”) to investigate claims by employees. At the federal level, the labor division/department is known as the United States Department of Labor (USDOL). In Colorado, the labor board is known as the Colorado Department of Labor and Employment (CDOL). Both USDOL and CDOL investigate various types of labor violations and, in particular, both have Wage and Hour Divisions charged with enforcing the FLSA and Colorado wage and hour laws.

Because both federal and state governments have limited funds available, both USDOL and CDOL have limited resources and staff. As a result, and given the massive volume of complaints they receive, USDOL and CDOL both have certain enforcement priorities and limitations on what they can do for individual employees.

To assist USDOL and CDOL in enforcement, and keep the agencies from being overwhelmed, both the federal and Colorado governments also have established a mechanism to make it possible for employees to afford to hire private attorneys to assist with claims for unpaid wages and overtime. Specifically, under both the FLSA and Colorado wage laws, an employer who breaks the law must pay for the attorney hired by the employee to make the claim for wages. This allows individual employees to hire their own attorney without paying any money out of pocket and is known as paying an attorney a “contingent fee” because the attorney’s compensation is contingent on winning the employee’s case.

Given that Colorado employees generally can hire an attorney under a contingency fee arrangement, there are several potential drawbacks to submitting a claim to USDOL or CDOL without first consulting a private attorney. The following are factors you should consider in determining how best to recover your unpaid wages:

• The labor boards often will not try to recover all of the money that may be available to you under the FLSA and Colorado wage laws. For example, USDOL and CDOL may recover only the backwages or unpaid overtime owed to you without also pursuing certain available penalties and interest. Also, labor departments may not pursue wages owed for work performed more than two years prior to the complaint.
• The labor boards will investigate your case and try to negotiate a payment from your employer. If the employer refuses to pay, however, USDOL and CDOL often will not file a lawsuit on your behalf but will simply refer you to a private lawyer. Employers know this and often use it to delay the investigation. Given that USDOL and CDOL investigations can take months, this process can result in delay and/or a loss of rights.
• The labor boards are understaffed and, therefore, individual USDOL and CDOL investigators are very busy. As a result, you may have difficulty communicating with your investigator.
• The labor boards generally will not share with you all of the information they learn during their investigation. In contrast to a private attorney, they generally are not acting as your personal agent in pursuing your claim.
• The labor boards often are focused more on changing pay practices and bringing employers into compliance than on recovering all of the money owed on your claim.

Please note that the foregoing is not intended to portray the hard-working USDOL and CDOL investigators in a negative light. Working with limited resources, they help thousands of wronged employees and, depending on the circumstances, it might make more sense to pursue your case through the labor department. To make sure you are fully informed about your rights, however, before contacting the labor department, you may first wish to contact us for a free and confidential case evaluation.