By Allen Smith, J.D.
Employees around the world were at risk of not being paid on time due to the massive tech outage that began July 19 when CrowdStrike, a Texas-based cybersecurity company, updated its software. We’ve gathered articles on the news from SHRM Online and other outlets.
Costly Update Bug Hits Windows Users
CrowdStrike issued an update to its Falcon Sensor software, but a bug in the update hit Microsoft Windows machines, taking scores of companies offline on July 19.
CrowdStrike emphasized that the issue wasn’t caused by a cyberattack. “Our customers remain fully protected,” CEO George Kurtz said. “We understand the gravity of the situation and are deeply sorry for the inconvenience and disruption.”
Experts said it’s too early to get a firm handle on the price tag for the global outage. But those costs could easily top $1 billion, said Patrick Anderson, CEO of Anderson Economic Group, a Michigan research firm that specializes in estimating the economic cost of events such as strikes and other business disruptions.
Employees Share Concerns on Social Media
People took to social media to complain about the financial implications of the outage, with one person writing on X: “No direct deposit yet.”
Another person wrote: “My company was not affected by the IT outage, but our payroll software was.”
Consequences of Not Paying Wages Promptly
Employees who do not receive timely payment of wages can sue and can seek not only their unpaid wages, but liquidated damages equal to 100% (and in certain states 200%) of the amount of wages not timely paid. In many jurisdictions, civil penalties and attorney fees are also available to prevailing plaintiffs in wage lawsuits. The wage laws do not provide a defense based on lost access to payroll funds.
Make Speedy Payroll Corrections
Absent specific state requirements, it is important for an employer to ensure that employees are paid in a timely manner for all wages earned. It is recommended that employers make payroll corrections immediately and not wait until the next pay period.
