What Are Unpaid Overtime Settlements?

What Are Unpaid Overtime Settlements?

Picture of workers working unpaid overtime

All employers and businesses are required by law to pay workers a regular rate for any non-overtime hours at work. If employees work more than the federally-defined 40-hour workweek, additional hours attract a premium overtime rate.

Regrettably, not all organizations operate in the best interests of their employees. If you have unpaid overtime settlements, you may be legally entitled to recover the monies owed.

Workers are able to pursue:

  • Unpaid wages
  • Unpaid overtime settlements
  • Interest on unpaid sum

In some cases, businesses may need to pay supplementary penalties for failing to pay wages or overtime in accordance with the law.

It should always be possible to recover unpaid overtime. If you are anticipating an unpaid overtime settlement and you need to leverage the settlement, consider pre-settlement funding.

What is Overtime?

Federal law in the United States defines a standard working week as 40 hours. Employees are entitled to overtime payment for all additional hours worked.

The typical rate for overtime pay is time-and-a-half, meaning each overtime hour is paid at 150% of your regular hourly rate.

Employers are not legally entitled to average working hours across several weeks. If, for example, you worked 25 hours one week and then you worked 55 hours the following week, you would still be entitled to payment at time-and-a-half for ten overtime hours in the second week, despite the shortfall of hours the previous week.

Some states have laws and statutes for specified overtime.

If you believe you have had wages or overtime payments withheld, consider consulting an experienced employment attorney in your state.

What Is Included in Unpaid Overtime Settlements?

Most unpaid overtime settlements involve the corporation or business paying damages to the employee. Damages is a legal term used to describe compensation paid to victims of wrongdoing.

How much could you secure from an unpaid overtime suit, then?

This will depend on the specifics of your case, although damages can be categorized as follows:

  • Unpaid wages
  • Interest on unpaid wages
  • Penalties
  • Legal fees

Unpaid wages

This category of damages is intended to reimburse the victim for unpaid wages to which they were entitled.

When a worker successfully achieves an unpaid overtime settlement, the court is liable to rule that the employer must pay the money owed.

The amount of damages will include any overtime premiums that were withheld.

In the event of an employer paying regular rates instead of overtime rates, the victim receives the difference between the two rates.

You can maximize your chances of successfully pursuing an unpaid overtime settlement by hiring an experienced employment lawyer.

Interest on unpaid wages

If you have been a victim of wage theft, you can pursue interest on those unpaid wages or unpaid overtime hours. The amount of interest applicable to unpaid wages will vary according to state laws.

You may be entitled to pursue liquidated damages in place of interest. This is an amount predetermined by wage laws.

If a business or organization acts in bad faith by purposefully underpaying workers or withholding wages, they may be compelled to pay liquidated damages.


Some states require corporations found to have engaged in wage theft to pay additional penalties. These penalties are charged in addition to damages for unpaid wages. In California, as an example, employers convicted of wage theft are typically charged penalties amounting to 30 days of the regular rate of the worker.

Legal fees

Employers found guilty of wage theft will usually be required to cover the legal fees of the claimant, as well any other legitimate costs associated with the case.

How Else Does Wage Theft Occur?

Unpaid overtime is a common example of corporate wage theft, but there are many other ways in which unscrupulous companies increase profits by stealing both wages and time from their employees.

If workers are called upon to perform duties during mandated meals or breaks – by taking phone calls, for instance – the employer is legally obliged to compensate them for the time.

These are some other examples of wage theft:

  • Delaying the issuance of final paychecks
  • Inaccurately tracking work hours
  • Making inappropriate deductions from wages
  • Stealing the cost of work-related travel time
  • Withholding payment for sick leave or vacation

Take Action and Enforce Your Legal Rights to Unpaid Overtime Settlements

You might imagine suing an employer for unpaid wages is straightforward. Indeed, for some small and simple claims involving unpaid wages, you may find you can file a complaint with the labor department in your state, leading to a successful resolution.

If you have a larger or more complex case, though, you should retain an attorney. The contingency nature of legal fees mean you will pay nothing out of pocket. Instead, your lawyer will take a pre-arranged percentage of your final settlement.

Consider Risk-Free Settlement Funding from Tribeca 

While you can take action against an employer for unpaid overtime payments and likely win your case, you may find you are short of funds while waiting for your lump sum settlement.

One solution is pre-settlement funding, also known as legal funding or lawsuit loans. At Tribeca, we can arrange risk-free cash advances, repayable only if you win your case for unpaid overtime and lost wages. If your case does not settle, you do not repay us anything.

The settlement funding application process is quick and easy. You will not be required to prove your income or your employment status. You will not be required to submit to a credit check. After answering a few simple questions, a Tribeca representative will liaise with your attorney. Receive a risk-free cash advance in 24 hours by calling (866) 388-2288 today.

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