On July 24, 2025, the Department of Labor’s (DOL) Wage and Hour Division (WHD) announced the reimplementation of the Payroll Audit Independent Determination (PAID) program. The program allows employers to conduct self-audits to voluntarily correct payroll errors related to minimum wage or overtime violations under the Fair Labor Standards Act (FLSA) and certain violations under the Family and Medical Leave Act (FMLA).
The program aims to incentivize employers to voluntarily resolve potential violations of FLSA and FMLA without formal litigation or private arbitration between employers and employees. Under the program, employers who self-audit and disclose minimum wage or overtime violations to the WHD can provide back wages or other remedies to employees under the supervision of the WHD. To participate in the program, employers must be covered under the FLSA and FMLA and ensure employees included in the self-audit are not subject to certain prevailing wage laws. They also must not have been found in violation of FLSA minimum wage or overtime requirements in court or by WHD within the past three years, and they cannot be part of ongoing litigation assessing compensation practices that potentially violate the FLSA minimum wage or overtime requirements.
The first Trump administration introduced the PAID program in March 2018, implementing the program to reduce regulatory burdens for employers and promote voluntary compliance with wage laws. The Biden administration later discontinued the program, arguing that PAID deprived workers of their rights under the FLSA and placed complying employers in an unfavorable position.
The revival of the PAID program emphasizes a return to voluntary self-disclosure and legal cooperation by employers. CUPA-HR will continue to monitor for and keep members apprised of additional guidance from DOL on the PAID program.