H.R. 2299, Ensuring Workers Get PAID Act of 2025

H.R. 2299 would codify and make several changes to the Payroll Audit Independent Determination (PAID) program within the Department of Labor (DOL). As an alternative to litigation, the PAID program allows employers to self-audit minimum wage and overtime pay violations under the Fair Labor Standards Act (FLSA) and requires employers in violation to provide back wages or other remedies to affected employees. The PAID program was established in 2018 by DOL using administrative authority, terminated in 2021, and relaunched in 2025. For this estimate, CBO assumes that H.R. 2299 will be enacted before the end of calendar year 2026.

Direct Spending and Revenues

Under the FLSA, DOL can assess civil monetary penalties on employers that violate minimum wage and overtime regulations. The penalties are recorded as revenues, and a portion may be spent without further appropriation. DOL collected $12 million in penalties resulting from FLSA violations related to minimum wage, overtime, and tip retention in fiscal year 2025.

Participants in the PAID program currently are exempt from civil monetary penalties; CBO expects that exemption would continue under H.R. 2299.

CBO expects that the bill would prohibit DOL from using information that could be solely obtained as part of an employer’s PAID program application during investigations of that employer. It also would prevent the use of such information in discovery for a court case and, CBO expects, that prohibition would extend to any future investigations or discovery involving that employer. CBO anticipates that such protections, available even to those who are not ultimately approved to participate in the program, could spur more employers to apply. Some of those employers might have paid penalties under current law but would not under the bill.

H.R. 2299 also would limit an employer’s program participation to a single instance (unless the employer commits a different violation); the current program allows employers to participate once every three years. CBO expects that the change could increase the number of employers that would be subject to penalties under the FLSA.

CBO estimates that those two effects in combination would change amounts collected in civil monetary penalties, the direct spending of those revenues, and the deficit by less than $500,000 over the 2026-2036 period.

Using information from DOL on the pilot version of the PAID program, CBO expects that the number of applicants and participants subject to penalties under the bill, as under current law, would be small. That information showed that most participating employers were not in sectors most likely to be investigated for FLSA violations, that employers who had been found to have committed violations and might be more likely to commit violations in the future were ineligible to participate, and that fewer than 100 employers completed the PAID program during the 18‑month pilot period.

The current program also allows employers to self-audit and correct violations related to the Family and Medical Leave Act (FMLA) under PAID; it is not clear whether that would be the case under the bill. Because data from DOL show that the agency infrequently collects civil monetary penalties for FMLA violations, CBO estimates that whether such violations would be covered would not meaningfully affect the federal budget.

Spending Subject to Appropriation

Using information from DOL, CBO estimates that implementing H.R. 2299 would increase the agency’s administrative costs by $1 million over the 2026-2031 period because the agency would have to interpret and enforce the law, update the case management system, and train DOL staff on the new procedures. Such spending would be subject to the availability of appropriated funds.

The CBO staff contact for this estimate is Justin Latus. The estimate was reviewed by Christina Hawley Anthony, Deputy Director of Budget Analysis.