United Healthcare to Pay over $1M in FLSA Settlement

February 8, 2011 (PLANSPONSOR.com) – UnitedHealthcare has agreed to pay $934,551 in back overtime wages and a $104,280 civil penalty after a U.S. Department of Labor (DoL) investigation.

A DoL news release said the insurer had been the focus of an investigation by the Wage and Hour Division into allegations it had incorrectly classified some employees at its Hartford, Connecticut, location as being exempt under the Fair Labor Standards Act (FLSA).   UnitedHealthcare is the largest health insurance carrier in the United States.

The DoL said that after conducting 90 employee interviews and reviewing time and payroll records for 21,000 employees, investigators determined that UnitedHealthcare incorrectly classified employees in several different occupational categories as administratively exempt under FLSA, denying them overtime compensation for all hours worked over 40 in a week.

The company also failed to include certain compensation for employment in workers’ regular rates, on which time and one-half should have been paid, the DoL said. Additionally, recordkeeping violations were uncovered, as records of the number of hours worked were not properly maintained for those who had been misclassified as exempt.