Department of Labor Audits

Department of
Labor Audits

Being Audited by the Department of Labor

If you recently received a notice from the New Jersey Department of Labor regarding an audit of your company, the time is now to speak with an employment attorney. The Department of Labor may begin an audit of your business as a standard practice or after a complaint is filed by an employee. These investigations evaluate whether your company is complaint with state and federal laws and regulations involving overtime pay, minimum wage, workers’ compensation, and other employment matters related to your business. In New Jersey, an audit by the state or federal Department of Labor will require extensive documentation and information gathering on your part to ensure a positive outcome. In order to prepare and address all of the Department’s questions effectively, it is highly advisable to retain knowledgeable legal counsel.

Facing a Department of Labor Audit

An audit by the New Jersey or United States Department of Labor can happen to any employer at anytime. The department may conduct an audit randomly on a company of any size. Unbeknownst to many, not all investigations by the NJ Labor Department occur because of an employee reporting a company violation. Some of the most common complaints that lead to Department of Labor audits in New Jersey involve wage and hour laws, misclassification of employees to avoid overtime pay requirements, failure to pay minimum wage, inadequate workers compensation insurance coverage, and other violations of employer obligations.

Audit Process

It is critical to understand the audit process and frequent requests from auditors so that you are thoroughly prepared for a Department of Labor inquiry. You will generally receive a notice in the mail from the NJ LWD informing you that an audit of your business will be performed. It is then time to gather all of the information and documentation you will need to protect your business from being issued penalties. It will first be important to determine the focus of the investigation, whether it be compliance with overtime pay or minimum wage laws, exempt versus nonexempt classification of employees, workers’ compensation, or other employment practices.

You must be prepared to answer questions and provide documentation to demonstrate your compliance. Some of the typical documents needed include certifications, payroll records, company policies, and proof of coverage. New Jersey requires companies to maintain records and have them readily accessible at the place of business for the current year and four prior years. If the audit is only focused on the current calendar year, you will need to produce these records. If the Department of Labor’s inspection covers more than one year, the years requested will be required.

Business and Commercial Law

Our litigators develop a case-specific and cost-effective strategy based on our client’s needs and objectives.  In high-stakes litigation, we frequently develop and implement an aggressive strategy designed to enforce and vindicate our client’s rights.  While data shows that most cases are resolved by way of settlement, we aggressively prepare our cases for trial, while others must proceed to trial, or arbitration and the outcome defended or challenged on appeal. The planning and implementation of an appropriate strategy to meet a particular client’s goals and objectives encompasses more than legal and factual analysis – business or personal circumstances, financial considerations, and the specifics of the matter at hand are always taken into account. We take pride in our ability to master the facts and applicable law, analyze the big picture, and move forward on the client’s behalf.

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Labor Audit Specialist

Labor Audit Specialist