ATR Supports the Ensuring Workers Get PAID Act

Americans for Tax Reform President Grover Norquist has released a letter in support of the “Ensuring Workers Get PAID Act,” legislation that codifies the DOL’s Payroll Independent Determination (PAID) pilot program established in 2018. The PAID program allowed employers to revise accidental wage and hour violations without triggering a costly DOL investigation. 

Codifying the PAID program is a win-win for employers and employees. Employers will once again have an avenue to voluntarily report inadvertent FLSA violations, increasing compliance with the law. Employees will recoup back wages on an expedited basis without the expenses of litigation. 

Click here or see below to read the full letter: 

May 23, 2022

Dear Member of Congress,

I write in support of S. 3074/H.R. 5743, the “Ensuring Workers Get PAID Act,” introduced by Sen. Mike Braun (R-Ind.) and Rep. Elise Stefanik (R-N.Y.). This bill codifies the Payroll Audit Independent Determination (PAID) pilot program, which was successfully launched by the U.S. Department of Labor (DOL) in 2018 to allow employers to revise accidental wage and hour violations. 

Americans for Tax Reform urges all members to co-sponsor the Ensuring Workers Get PAID Act.

The PAID program established a system for employers to revise accidental overtime and minimum wage violations under the Fair Labor Standards Act (FLSA). The program incentivized employers to self-audit and report accidental violations to the DOL without triggering costly and time-consuming investigations. 

During the implementation of the PAID program, employees were able to receive 100 percent of back wages they were owed without any delays resulting from extraneous investigative backlogs. Despite its success in expediting the payment of back wages to workers, the Biden Administration ended the program within the first ten days of President Biden’s inauguration, asserting that it prevented workers from pursuing a private right of action.  

The Biden Administration falsely characterized the PAID program. Firstly, its claim that workers were unable to pursuit a private right of action because of the program is incorrect. Secondly, the PAID program yielded more positive outcomes for workers in receiving unpaid wages than would typically result from an investigation.

A DOL report on the effectiveness of the PAID program found that the average back wages paid to employees per case under the PAID program was more than four times the wages paid out under a traditional investigation and more than 10 times the back wages per Wage and Hour Division staff hour invested. Additionally, self-audits through the PAID program took less than half the time to complete per case compared to a traditional investigation.

Without an avenue for employers to voluntarily report inadvertent FLSA violations, onerous DOL investigations are the only path for workers to recoup back wages. The current framework is a lose-lose situation for both employers and employees. Employees have to wait longer recoup less money than under the PAID program, and employers who have committed minor mistakes are subjected to lengthy DOL investigations. 

Codifying the PAID program is a win-win for employers and employees. Employers will once again have an avenue to voluntarily report inadvertent FLSA violations, increasing compliance with the law. Employees will recoup back wages on an expedited basis without the expenses of litigation. 

All members of Congress should co-sponsor the Ensuring Workers Get PAID Act. 

Onward,

Grover Norquist
President, Americans for Tax Reform