Just last week, the Wage and Hour Division (WHD) of the DOL announced a new pilot program called the Payroll Audit Independent Determination (PAID) program.

The goal? To expedite resolution of overtime and minimum wage violations under the Fair Labor Standards Act (FLSA). The overall mission? To promote and achieve compliance with labor standards that will in turn, enhance the welfare of U.S. workers.

This self-audit pilot program will be rolled out nationally for six months and will evaluate its effectiveness at the end.

Here are a few things to know:

Why is this program being launched?

According to the DOL, the PAID program will work to ensure that more employees receive 100 percent of their owed back wages, quicker (and without paying any litigation expenses). Also, the WHD will not impose penalties or liquidated damages to finalize a settlement for those employers who choose to participate in the program.

Under the program, WHD will oversee resolution of potential violations by assessing the amount of wages due and supervising their payment to employees, thus facilitating resolution.

Who can participate?

All FLSA-covered employers are eligible (unless currently in litigation).

What types of violations will the program cover?

In general, the PAID program covers potential violations of inadvertent overtime and minimum wage requirements under the FLSA. Some examples include:

  • Violations based on alleged ‘off-the-clock’ work.
  • Failures to pay overtime at one-and-a-half times the regular rate of pay.
  • Misclassification of employees as exempt from the FLSA’s requirements.

How can you participate in the program?

As an employer, you are required to review the requisite information about PAID and all compliance assistance materials first. This is to ensure you fully understand the intricacies of the program as well as your specific overtime and minimum wage obligations under the FLSA.

Next, you’ll have to complete a self-audit of your compensation practices. If you uncover any non-compliant processes, here are the next steps:

  1. Specifically identify potential violations.
  2. Identify the employees affected.
  3. Identify the timeframe(s) the employee was affected.
  4. Calculate the amount of back wages you believe is owed.
  5. Contact WHD to discuss.

Unless WHD denies your request to participate in PAID, the department will then inform you how you must submit the required information.

Full instructions on these steps can be found here.

Employers – Here are some things you aren’t permitted to do:

You may not participate in the PAID pilot program if you are currently in litigation or under investigation by the WHD.

You cannot use the program repeatedly to resolve the same potential violations. The DOL is clear that the program was designed to identify and correct non-compliant practices.  

Does this benefit your employees?

The DOL suggests that the program will ensure employees receive 100 percent of back wages paid, without having to pay litigation expenses or attorneys’ fees. Because you’re required to review the compliance assistance materials and correct pay practices moving forward, the idea is that it will improve your compliance and protect your workers.


For more information on this PAID pilot program, read the full release here.

Click here for FAQs.

Sign up to receive alerts on the launch.

Register now for our upcoming webinar.

Want even more compliance information on managing wage and hour rules? Then don’t miss our upcoming webinar – the first installment in our new Small Biz Success Series!

Join us on March 20, 2018 at 1:30 p.m. as we’ll discuss the latest DOL developments and explain how to correct any mishaps.

Our own Steve Jackson, SVP of Broker Concierge, and Laura Kerekes, Chief Knowledge Officer at ThinkHR will discuss:

  • Pay issues that impact motivation and retention.
  • Trending pay laws like equal pay mandates, salary history ban, and pay transparency.
  • Employee classification, including new guidance for interns.
  • Best practices for hiring and managing gig workers.
  • Flexible and predictive scheduling.  

Oh and did we mention? You’ll get a SHRM credit for attending.

Click here to register.