Settlements 101: The Fair Labor Standards Act

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The principle that one cannot consent to work for less than what is prescribed by FLSA, so as to prevent circumvention of the Act, is long- established. Overnight MotorTransp. Co. v. Missel, 316 U.S. 572 (1942). For similar reasons, courts have also imposed strict limitations on when and how claims under the Act can be settled. Nearly sixty years ago, in Brooklyn Sav. Bank v. O’Neill, and its companion case, Dize v. Maddrix Arsenal Bldg Corp., the Court held that “in the absence of a bona fide dispute between the parties as to liability,” one cannot release one’s right to liquidated damages under § 16(b).1 324 U.S. 697, 704 (1945).