Understanding the Statute of Limitations on Unpaid Wages 

When someone realizes they’ve been shortchanged on pay, whether it’s unpaid overtime, missed commissions, or withheld final wages, the reaction is often: “Why wasn’t I paid for this? I need my money!” But the hard truth is that in most cases, there’s a legal limit to how far back you can go to recover your pay. The legal term for this is the statute of limitations and missing the deadline can mean losing out forever on your chance to claim the money you could have been owed. 

At Josephson Dunlap LLP, we see this all the time: workers come forward years after realizing unfair pay, only to discover that the statute of limitations has already run out. That’s why urgency and timing matter for workers like you, who have been taken advantage of by companies and corporations who are only looking out for their bottom line. 

What the Statute of Limitations Means in Wage Cases 

The statute of limitations is basically a deadline for taking legal action. If you don’t file your claim before that deadline runs out, you usually lose your right to sue or collect money, even if your claim is otherwise valid.  

In cases about wages or work hours, this means you only have a certain amount of time to demand unpaid wages or challenge wage violations. After that window closes, the law won’t let you pursue it. 

• Under the Fair Labor Standards Act (FLSA) (federal law), you usually have two years from the date of the violation to sue for back wages and liquidated damages.  

• But if the employer’s violation was willful, or if your employer knew or showed reckless disregard for the law, that deadline could extend to three years. 

As with most other laws in the United States, different states also have their own statutes of limitations or deadlines for wage claims, which may be longer than what the FLSA typically allows. 

Here are a few examples: 

• California → 3 years for most wage claims. 

• New York → up to 6 years for many unpaid wage claims. 

• Massachusetts → 3 years. 

• Wisconsin → 2 years. 

• Illinois → 3 years under state law. 

Why People Often Notice the Problem Too Late 

There are a few common reasons why an employee might not discover or act on wage violations quickly or before the statute has passed: 

• Lack of notice or transparency – If your employer paid you incorrectly from the start or never disclosed overtime rules, you may have never been aware there was an issue! 

• Misclassification – If your employer told you that you were going to be hired as an “exempt employee”, or even an “independent contractor”, and therefore not eligible for overtime, you would have likely assumed they were doing the right thing. 

• Records missing or confusing – If your employer’s records are lost, inconsistent, or withheld from you, then you may not even see the discrepancy or issue with your pay until much later in time, possibly until closer to, or after the statute has passed. 

• Fear of retaliation – Sometimes workers are worried that if they speak up, or stand up for themselves, the employer will take action against anyone who is defiant or dares to question a corporation. However, we’re here to tell you that the law is on your side, and that you are protected legally, from anything like this happening. 

Recommendations & Best Practices 

To protect your rights and those of your coworkers, here are some practical recommendations: 

1. DO NOT WAIT. If you suspect something might be wrong with your pay, or that your wages are being withheld, act. Keeping a good record of your pay and time is also incredibly important when it comes to your claim. 

2. Track your hours and pay meticulously. Save pay stubs, time sheets, schedules, and any communication (email, text) with regards to your pay. 

3. Ask questions formally. If something seems off, send a written request or inquiry. Having a record helps your case. 

4. Ask for help from an attorney early. An employment lawyer or law firm can help you assess whether your claim is timely and viable. 

5. File before the deadline. Don’t rely on “maybe later.” If the statute passes, your claim is likely time barred no matter how strong your case is. 

Conclusion

It’s hard to see someone trust and come to us years after the fact to seek counsel, realizing they were underpaid, but have no options to recover because the statute has passed. That’s why filing on time is crucial. Even the best claim, backed with excellent evidence, is doomed if filed too late. At Josephson Dunlap, our mission is to help workers recover what they are owed, but the law demands urgency. So, make sure that whether it’s you, someone you know, or work with, you act quickly, ask questions early, and don’t wait until it’s too late to protect your rights.

Sources: 
U.S. Dept. of Labor, Cornell Law (29 U.S.C. § 255), CA Dept. of Industrial Relations, NY Labor Law § 198(3), MA General Laws c.149 §150, WI Dept. of Workforce Development, Illinois Dept. of Labor, Me. Rev. Stat. tit.14 §752, Conn. Gen. Stat. §52-596, Ala. Code §6-2-38(m).