Are you and your management aware of this?
This particular aspect of the FLSA has made HR Directors very nervous about violating the FLSA where I have worked. Two sources (law firms) are cited for your consideration.
Personal Liability in FLSA lawsuits
In most lawsuits, even those involving employment-based claims, the existence of a corporation provides protection for owners, corporate officers, and employees from personal liability. One significant exception is when the suit is brought under the Fair Labor Standards Act. Owners, officers, and high-level managerial employees who exercise some control over employment matters often find, to their dismay, that they have been included as a defendant in an FLSA lawsuit along with the corporate employer.
The reason for this potential personal liability arises from the extremely broad definition of employer found in the FLSA: “‘Employer’ includes any person acting directly or indirectly in the interest of an employer in relation to an employee …”
Under the federal Fair Labor Standards Act ("the FLSA"), employers must follow the FLSA requirements or be liable for damages and even criminal penalties for violating FLSA provisions. The FLSA defines "employer" to include "any person acting directly or indirectly in the interest of an employer in relation to an employee". See 29 U.S.C. §203(d). Federal courts have routinely held that this definition of employer is to be broadly interpreted. The logic is that "employer" should be broadly construed in order to achieve Congress's intent to provide a remedy to employees for their employers' wage and hour violations. Even with such a broad definition, courts have declined to find that any person who has supervisory power, without more, is automatically an employer. Instead, courts generally look at the "economic reality" of an individual's status in the workplace before judging liability. This is determined by analyzing a number of factors, such as: (a) the person's job description; (b) his or her financial interest in the enterprise; and (c) the degree to which he or she is involved in hiring and firing employees. Other factors include the individual's involvement in day-to-day operations as they relate to defining the terms of employment, workplace conditions, and the level of compensation to be received by employees.
Prosecutions by the Department of Justice
The Department of Justice ("DOJ") can bring criminal actions for "willful" violations of the FLSA. A violation is "willful" if it is deliberate, voluntary, and intentional.
Enforcement actions by the DOJ can be brought instead of or in addition to lawsuits by the Secretary of Labor for back wages or injunctive relief. So, in cases involving willful violations, an employer can be ordered to pay liquidated damages and back-pay, as well as any criminal fine or penalty that is imposed by a court.
Criminal penalties under the FLSA are: