Numerous state wage laws provide for limitations periods longer than the maximum three years provided under federal law (such as six years under the New York Labor Law). Some state statutes fail to address the issue, giving rise to litigation over how far back a plaintiff can go on his or her minimum wage, overtime or other wage claims. In a unanimous decision issued late last week, the Arkansas Supreme Court held that the limitations period for overtime claims under the Arkansas Minimum Wage Act is three years, not five as urged by Plaintiffs.  The issue had been certified by a federal district judge to the state’s highest court.  Douglas v. First Student, Inc., 2011 Ark. 172 (Ark. 2011). The Douglas action is being defended by a Jackson Lewis team consisting of wage-and-hour specialists Steve Munger, Skip Smith and Justin Barnes. 

 “We have traditionally applied a three-year statute of limitations to actions arising under a liability that is imposed by statute,” observed Associate Justice Jim Gunter, who authored the opinion. “[We] hold that a three-year statute of limitations would apply to private cause of action brought pursuant to the [Arkansas Minimum Wage Act].” Douglas v. First Student, Inc., Supreme Court Case No. 11-361 (Order Nov. 3, 2011). In so holding, the Court rejected plaintiffs’ argument, based on earlier Arkansas precedent, that a five-year “catch-all” statute of limitations should apply, because in Douglas any liability was created expressly by statute, as opposed to a blend of statutory and contractual claims. 

This ruling in Douglas constitutes a victory for Arkansas employers, harmonizing the statute of limitations for actions under state law with the FLSA’s three years. The vagaries and unanswered questions of many state wage laws continue to trip up employers, especially those with multi-state operations.