Recognizing Misclassified Employees & Overtime Rights

Misclassification Is a Tool for Wage Theft

Being called “exempt” or “salaried” doesn’t always mean overtime laws don’t apply. Employers often use misclassification to cut labor costs, presenting it as routine business practice when in reality it’s wage theft. Workers lose out on overtime pay, meal breaks, benefits, and basic protections simply because their job title or pay structure is misrepresented.

Misclassification is more than a paperwork error. It’s a deliberate strategy used in industries where overtime is common. For employees, the impact can be huge, weeks of long hours without fair compensation. At Horn Wright, LLP, our employment law attorneys explain that uncovering misclassification is the first step toward recovering stolen wages.

How Employers Misclassify Workers in New York

Employers in New York misclassify workers in predictable ways. Some label employees as “independent contractors,” even when the company controls their schedule, duties, and tools. Others hand out “manager” titles that don’t match the reality of the work.

The Fair Labor Standards Act requires overtime pay for non-exempt employees working more than 40 hours a week. To qualify as exempt, workers must pass a strict duties test and meet a salary threshold. Employers often skip this analysis, assuming titles alone are enough.

New York law raises the stakes further. Under NYLL § 142-2.2, the salary threshold for exemption is higher than the federal standard, especially in New York City, Long Island, and Westchester. A worker making less than that threshold cannot be exempt, no matter what their job title says.

This is why misclassification and overtime pay violations often go hand in hand. Employers hope workers won’t know the difference, but state and federal law provide clear rules that expose these tactics.

Evidence That Proves Misclassification

Courts don’t take an employer’s word for classification, they look at the facts. Evidence that reveals misclassification often includes:

• Job duties. If your day-to-day work involves routine tasks like stocking, cleaning, or customer service rather than high-level decision-making, you’re likely non-exempt.
• Schedules and supervision. If the company sets your hours, requires time approvals, or closely monitors your work, that looks like an employment relationship.
• Pay structure. A flat salary that doesn’t meet New York’s exemption threshold under NYLL § 142-2.2 is evidence of misclassification.

Workers may also point to company policies, handbooks, or communications that show control. These details are powerful when identifying overtime violations, because they cut through misleading job titles.

Remedies for Misclassified Employees

Once misclassification is proven, workers are entitled to real remedies. The FLSA (29 U.S.C. § 216(b)) and NYLL § 198(1-a) provide for:

• Back pay. Employees can recover unpaid overtime going back two to six years, depending on which law applies.
• Liquidated damages. In most cases, courts award an equal amount on top of back wages, doubling the recovery.
• Attorneys’ fees. Workers don’t bear the cost of litigation; employers may be required to pay these expenses.

In New York, workers also gain access to unemployment insurance, workers’ compensation, and other benefits once reclassified. These remedies reinforce employer liability for overtime violations, showing that misclassification is a costly gamble, not a loophole.

Unlike New Hampshire, New York Provides Broader Misclassification Remedies

Not every state protects workers as strongly. In New Hampshire, misclassification remedies are narrower. Employees often rely on federal law alone, with shorter filing deadlines and fewer statutory penalties. Employers in New Hampshire face less risk, which means workers there recover less when misclassification occurs.

By contrast, New York provides six years to bring wage claims under NYLL § 198(3). Combined with liquidated damages and penalties for inaccurate wage statements under NYLL § 195(3), New York workers can recover significantly more.

This difference makes filing an overtime pay claim in New York especially powerful. It ensures employees don’t just get their missing paychecks but also the additional damages that deter future abuse.

Industries Where Misclassification Is Rampant

While misclassification can happen anywhere, certain industries rely on it heavily:

• Retail and sales. “Assistant managers” who spend most of their day stocking or running registers are misclassified as exempt.
• Healthcare. Nurses and aides are often given supervisory titles to avoid overtime, even though their main work is direct patient care.
• Construction. Workers are labeled as independent contractors even while using company tools and following strict schedules.
• Hospitality. Restaurants and hotels often classify employees as contractors or managers, stripping them of overtime pay and benefits.

In each of these industries, employer liability for overtime violations grows when entire categories of workers are misclassified. That’s why group actions are common, with multiple employees joining together to recover wages.

Why Misclassification Robs Workers of Overtime Rights

The harm from misclassification goes beyond paychecks. Workers lose not just overtime but also rest breaks, meal periods, unemployment benefits, and protections against retaliation. Employers effectively strip workers of their legal safety net while demanding the same long hours.

This practice is especially damaging in industries with high turnover and low margins, where workers already struggle to make ends meet. By denying overtime, employers shift the financial burden onto employees while reaping the benefits of longer hours.

For workers, recognizing misclassification is the key to reclaiming those rights. For attorneys, proving it is central to calculating unpaid overtime damages and building a case that ensures employees are compensated fully.

Horn Wright, LLP, Identifies and Challenges Misclassification

Misclassification isn’t a gray area, it’s a violation. Employers know that calling workers “exempt” or “independent” saves them money, but the law doesn’t let titles override reality. At Horn Wright, LLP, we dig into job duties, pay structures, and company policies to uncover misclassification and fight for the remedies workers deserve.

Our employment law attorneys pursue every angle: back pay, liquidated damages, penalties, and reclassification that restores benefits. We don’t let employers hide behind labels. We show courts the truth about the work and the workers who do it.

If you’re ready to work with a nationally recognized firm that exposes misclassification and restores overtime rights, Horn Wright, LLP, will hold employers accountable and recover the wages you earned.