While the recent explosion in condo contract lawsuits has been well-documented on this blog and in the media, apparently, another type of lawsuit is also on the rise in Florida courts — and has been so for several years. As Julie Kay of the Daily Business Review reported on Monday (unfortunately, there is no link to the article on-line), the Southern District of Florida is now “leading the nation in wage-and-hour lawsuits, with the Middle District of Florida, second.” The articles reports that this year, some 955 such cases have been filed in the Southern District, and 784 filed in the Middle District.
When I practiced law in California — which easily has the most stringent state labor and employment laws in the U.S. — wage-and-hour suits (i.e., claims alleging violations of laws on overtime pay and regulating hours worked) were a common occurrence, and I worked on a bunch of them. It surprises me that Florida, with its comparativelty lax regulatory climate and pro-business milieu, has the most wage-and-hour cases filed in federal court, although I suspect that the bulk of such lawsuits filed in California are filed in state court, not federal court, for various reasons. The Daily Business Review article only examined cases filed in federal court.
Still, the increase in wage-and-hour actions in Florida deserves some thought, as they can be quite costly for the companies which are sued. As an example, here is a recent article concerning a $12.6 million wage-and-hour class action settled by Mas-Tec, a Coral Gables-based company. One plaintiff’s lawyer quoted in the article suggests that the trend is owing to the fact that “South Florida is a community of small and midsized businesses,” and that “[t]here are no unions down here.” I’m not sure that the present lack of union activity makes Florida much different from most other parts of the country, but there may be something to the notion that structural features of Florida’s economy breed a culture of non-compliance with labor and employment laws, including those governing overtime and hours. Indeed, some of these features are likely also at play in the propensity of some developers to play fast and loose with state and federal regulations pertaining to condo sales, a propensity which has only recently surfaced with the recent spate of condo contract litigation.
The bottom line is that in an overheated economy, regulatory compliance typically takes a back seat for businesses keen on rapidly seizing perceived opportunities and muscling out would-be competitors looking to get in on the action. “Overheated” surely describes the Florida real estate market in the past few years, and perhaps it describes the Florida economy more generally as well, but looking back a decade or two. As such, the explosion in Florida of these two brands of litigation — condo lawsuits and wage-and-hour cases — might be seen as emanating from a similar source, and as fallout from Florida’s economic “heat.”
This article does not constitute legal advice or the formation of an attorney-client relationship, and is not for re-publication without express permission of the author.
Mr. Beck has a law degree from Harvard Law School, and practices law in the courts of South Florida. His practice includes business and commercial litigation, condominium contract litigation, and labor and employment litigation. He can be reached at 305-789-0072 or email@example.com