Just when you thought the Department of Labor had run out of surprises, on June 27, they handed employers a win. The DOL issued Field Assistance Bulletin 2025-3, which essentially says that unless the DOL sues you, they can’t demand liquidated damages anymore. Going forward, they’re limited to collecting just the unpaid wages or overtime owed during investigations.
How did it get to this point?
The History (Spoiler: It’s Been a Mess for a While)
2010 – The DOL starts demanding liquidated damages during investigations, no legal authority required.
2020 – They backtrack, admitting it slows things down and doesn’t help workers.
2021 – The Biden administration reverses course again with FAB 2021-2.
2025 – The Trump DOL says: “Yeah… this was never legal.”
What This Means for You
The upside is that if the DOL investigates your business, the worst they can do (for now) is demand repayment of what’s owed. That’s it. No automatic double penalty.
However, you shouldn’t get too cozy, because if they decide to file a lawsuit? Liquidated damages are still in play.
The smart move? Use this window to review and update your wage and hour practices. It’s better (and cheaper) to find the issues yourself than to let the government do it for you.
What Hasn’t Changed (Sorry!)
- The DOL can still investigate you, and sheesh, they are active lately
- They can still collect back pay
- Employees can still sue – with double damages
- State laws (especially California’s) can still hit hard
- You still need to comply with the FLSA and all the rest
The Real Takeaway from FAB 2025-3
While this bulletin doesn’t give you a free pass, it does lower the stakes a bit. Think of it like getting a warning instead of a speeding ticket. You’re still on the hook if you don’t follow the rules.
Smart business owners should use this as a breather to get things right:
- Review your timekeeping systems
- Reassess who you’ve classified as exempt
- Shore up your wage and hour policies
One Last Note
Keep in mind that this change only applies going forward. If you signed anything agreeing to liquidated damages before June 27, 2025, those are still enforceable.
Our Not-So-Subtle Reminder
If you want help making sure your practices can hold up to DOL scrutiny, and especially if you’ve already got investigators sniffing around, give us a call. We’ve helped businesses across five states stay compliant and profitable, and we can do the same for you.
Let us lose sleep over the legal stuff so you don’t have to.
As always, this isn’t legal advice, just helpful info. If you’re facing a real DOL issue, don’t guess. Talk to us.
