Violate the FMLA? The PAID program might help employers avoid costly penalties

On July 24, 2025, the U.S. Department of Labor’s Wage and Hour Division (WHD) announced that it is restarting the Payroll Audit Independent Determination (PAID) program to enable employers to self-identify and resolve leave violations under the federal Family and Medical Leave Act (FMLA). Under the program, employers can correct mistakes efficiently and quickly and avoid litigation.

When contacting the WHD about participating in PAID, employers must be prepared to certify that the following is true:

• They are an employer covered by the FMLA.
• The employees included in their proposed PAID self-audit are not subject to prevailing wage requirements under the H-1B, H-2B, or H-2A Visa Programs, the Davis Bacon Act or Related Acts, or the Service Contract Act.
• Neither the WHD nor a court of law has found within the last three years that they have violated the FMLA.
• They are not currently a party to any litigation (e.g., private, with the WHD, or with a state enforcement agency) asserting violation of the FMLA practices at issue in this proposed PAID self-audit.
• The WHD is not currently investigating problematic FMLA practices in this proposed PAID self-audit.
• They have informed the WHD of any recent FMLA or state leave law complaints of which they are aware to the WHD or a state enforcement agency, asserting that the leave practices at issue in this proposed PAID self-audit violate the FMLA requirements.
• They have not previously participated in PAID within the last three years to resolve potential FMLA violations resulting from the leave practices at issue in this proposed PAID self-audit.
• They have a continuing duty, during the audit process, to update the WHD on any changes to the above information and/or representations.
• They acknowledge that participating in the PAID program does not cut off employee rights under other federal employment laws (e.g., Americans with Disabilities Act, Pregnant Workers Fairness Act, Title VII) or any other state or local employment-related laws.

The WHD examines potential participants on a case-by-case basis.

From there, employers will be expected to:

• Review FMLA compliance assistance material to help them understand the program and their FMLA obligations before conducting a self-audit.
• Enter their name and the name of their business at the start of the review.

After they complete the Compliance Assistance Review, the system will generate a Certificate of Completion. 

After performing a self-audit, employers will contact the WHD district office. They will be asked to provide:

• The names, addresses, and phone numbers of all affected employees;
• The back wage calculations, along with supporting evidence and the methodology used to make those calculations;
• Any other FMLA remedies described above, along with supporting evidence and methodology;
• Payroll records and any other relevant evidence;
• Records demonstrating the nature of the violation and impact on affected employee(s);
• Records showing that they have corrected the leave practices to comply with the FMLA;
• A concise explanation of the scope of the potential violations for possible inclusion in a release of liability;
• A certification that they reviewed all of the program's information, terms, and compliance assistance materials; and
• A certification that they meet all eligibility criteria of the program.

The WHD will then evaluate this information and contact employers to discuss the next steps, including collecting any other information necessary for the WHD to review remedies due to the identified violations. Once accepted into PAID, the WHD will provide a proposed scope of the release of liability for the potential violations presented.

The WHD will review the violation and proposed remedies and confirm whether the proposed remedy is adequate. Employers must implement the remedies within 15 days of receiving the finalized self-audit results from the WHD.

The FMLA rarely results in class action FMLA lawsuits, so the PAID program might not be for everyone. Those employers that do participate in the program, however, might save themselves from costly penalties by clearing up compliance mistakes.