In yesterday’s Advisor, Attorney Kara E. Shea explained how to classify exempt employees; today, she elaborates on the perils of misclassification and what you can do to avoid damages.
Category Archives: Wage and Hour
Answers to some common questions about paying workers plus how to comply with FLSA regulations relating to exemptions, minimum wage, and overtime.
Yesterday’s Advisor featured two big-name companies—Shell Oil and LinkedIn—and their expensive wage and hour woes. Today, two more word-to-the-wise cases.
Timekeeping and Payroll Best Practices
McCutchen suggests HR managers pay attention to the issues below. McCutchen made her comments at the SHRM Annual Conference and Exhibition, held recently in Orlando.
Causes of Off-the-Clock Claims
- Paying shift time
- Failing to capture pre- and postshift work (booting up time, preshift meeting time, etc.)
- Automatic deductions for unpaid meal breaks
- Exception time reporting
- Paper timesheets
- Inconsistent time and payroll records
Bonuses: Discretionary Versus Nondiscretionary
First, let’s take a step back and look at which bonuses will trigger the need to change overtime calculations. Not all bonuses are created equal. There are discretionary bonuses—those paid solely at employer discretion (without parameters set in advance), and there are nondiscretionary bonuses—those paid according to set criteria and paid out as soon as those criteria are achieved.
Paul Johnson Drywall Inc. and its owner, Robert Cole Johnson, have agreed to pay $600,000 to resolve wage/hour claims. The company entered into a contract with Arizona Tract LLC for the provision of drywall labor. Arizona Tract classified the workers as “member/owners” instead of as employees, which stripped them of basic worker protections afforded to employees.
Black Bear Burritos LLC Will Serve Up $232,295 in Back Wages
Black Bear Burritos LLC will pay a total of $232,295 in back wages to 105 workers employed at two restaurants located in Morgantown, West Virginia. Violations included requiring servers to participate in an illegal tip pool, or tip sharing arrangement. When notified of the violations, the company agreed to pay all back wages and to future compliance.
Here, from the pages of BLR’s Wage & Hour Compliance: Practical Solutions for HR, are tips for training supervisors.
In trying to avoid unauthorized overtime, you’ll have to get down to where the rubber meets the road, in this case, your frontline supervisors. They have to be aware of your policies, have tools for enforcing them, and they have to resist the temptation to do things that encourage working off the clock.