Wage & Hour Disputes
What can I do as an employer to make sure I do not unintentionally violate wage and hour laws governed by the FLSA?
Unfortunately, employment violations are committed every day across the United States. While the rules regarding federal and state wage and hour laws can be complex, sometimes being guilty of an honest mistake is not enough to defend yourself against accusations of pay violations. The Fair Labor Standards Act (FLSA) institutes conditions for minimum wage, equal pay, overtime pay, child labor and recordkeeping benchmarks for employers. While many employers understand certain obvious areas of employment law, there is much more to the FLSA which is why employers far too often make errors that could prove costly.
The following is a list of common employer mistakes that can help you as an employer understand how to protect yourself from unintentionally violating wage and hour laws.
Exempt and Nonexempt Job Misclassifications
A nonexempt employee is generally one paid at an hourly rate that must record time in, time out and any breaks. Exempt employees are typically those that are paid a set amount regardless of how many hours they work. As an employer you cannot haphazardly dole out jobs to nonexempt and exempt categories without relating job descriptions to the FLSA guidelines. These guidelines define job descriptions based on duties and compensation level.
Miscalculating Overtime Pay
For all hours worked over 40 in a workweek overtime must be paid by the employer at the rate of 1.5 times the employee’s regular rate of pay. Hours cannot be averaged over two workweeks and any bonuses could affect the rate in which overtime must be calculated.
Failure to Pay Minimum Wage
Florida’s current minimum wage is $7.31 per hour. Florida employers must not pay employees anything less than the hourly minimum wage, with some exceptions. Any deductions, fines or other penalties taken out of an employee’s paycheck must not reduce their pay to below minimum wage.
Providing “Comp Time” Instead of Overtime
As an employer it is up to you to grant comp time to employees who are exempt from overtime. However, and with few exceptions, nonexempt employees must be paid the overtime rate for all hours totaling more than 40 in a workweek. Even if they prefer comp time, employees cannot waive their overtime rights.
Tracking Break and Meal Times Incorrectly
Nonexempt employees do not have to clock out for breaks up to 20 minutes. For meal breaks between 30 and 60 minutes, they should clock out. If an employee eats at their work station, they are considered “on the clock” and all time should be calculated into hours worked.
Failing to Pay Nonexempt Employees for Meetings, Seminars, Coursework, Travel Time and Prep Time
Meetings regarding the workplace held either before or after normal work hours are considered hours worked. Travel to the workplace is not generally considered hours worked, but traveling from the workplace to other work sites may be. Seminars or coursework assigned to nonexempt employees as part of the job should be compensated as hours worked.
Expecting or Permitting Nonexempt Employees to Work "Off the Clock"
Any time a nonexempt employee performs their job duties, they must be paid accordingly. Nonexempt employees cannot donate their time and services in the workplace even if they wish to do so.
The rules governing wage and hour scenarios are complicated so it is best to implement compliance in the workplace to avoid any potential wage and hour disputes. This can be done by reviewing any written policies and making sure they are enforced, automating scheduling and time information to reduce manual errors, establishing complaint procedures, having employees certify all hours recorded are actual hours worked, refraining from correcting any mis-punches or time errors without notifying the employee and finally, properly training all employees so that managers and supervisors comprehend that they cannot violate wage and hour laws and workers cannot be required to work off the clock.
While these are simply general rules to abide by in the workplace, there are always exceptions to various job positions and industries. To ensure that you are properly in compliance it is best to compare job descriptions and payroll practices with provisions from the FLSA. It is important to understand that investigators with the U.S. Department of Labor can inspect your records at any time, they do not need a formal complaint from an employee to do so. Generally, employers or industries known for or suspected of wage and hour abuse are targeted.
New laws regarding wages and hours are constantly being implemented, so if you have any questions regarding your rights and obligations as an employer under state and Federal law, contact The Villages Employment Lawyers at Whittel & Melton, LLC online or reach us at 352-369-5334.