A national consulting firm, NERA Economic Consulting, has just released an interesting study titled Trends in Wage and Hour Settlements: 2013 Update. The study commented as follows as to the recent trends by industry in wage and overtime cases.
We identified the industry of the settling defendant for each case and categorized the defendants into one of the following categories: Financial Services/Insurance, Food and Food Services, Healthcare/Healthcare Services, Manufacturing, Retail, Technology, Telecommunications/Utilities, Transportation/Shipping, and Other.
Overall, companies in the financial services/insurance and retail industries continue to be the most common defendants in these settled wage and hour cases. In 2013, we found a decline in the proportion of defendants in the retail industry, with only 10 percent of the cases involving a retail defendant compared to approximately 17 percent over the 2007 to 2012 period. On the other hand, we saw the proportion of cases involving healthcare/healthcare services defendants more than double—in 2013, healthcare/healthcare services defendants were involved in approximately 12 percent of the settled cases compared to 6 percent over the 2007 to 2012 period.
Retail continues to dominate the total spending category for cases settled over the 2007 to 2013 period, with approximately 30 percent of total settlement dollars being paid in that industry and about 20 percent paid by financial services/insurance companies.
While last year we observed a spike in total settlement dollars from companies in the healthcare/healthcare services industry, this year, the spending has returned to the proportions of total spending observed pre-2012. In 2013, settlements in the financial services/insurance industry represent the largest proportion of total settlement dollars paid, while less than 2 percent of total spending was paid by companies in the manufacturing industry. Spending from companies in the retail industry has continued the steady downward decline from 2009, representing only 5 percent of the spending for the first three quarters of the year compared to 46 percent in 2009.
In 2013, we also observed a spike in the total spending and average settlement value for cases in the “other industry” category. This increase was driven primarily by the fact that four out of the five largest settlements tracked in the first three quarters of 2013 involved defendants in industries that historically have had few wage and hour settlements, including corrections, refining, and other services.
