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.

Best Practices from Former Wage and Hour Administrator

"SPECIAL from SHRM Annual Conference and Exposition, Orlando In yesterday’s Advisor, Attorney Tammy D. McCutchen offered tips for avoiding wage and hour lawsuits and charges. Today, McCutchen, former administrator of the wage and hour division at the Department of Labor and principal at the Littler Mendelson law firm in Washington, D.C., offers best practices."

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


What Overtime Violations Are Lurking in Your Timekeeping System?

"SPECIAL from SHRM Annual Conference and Exposition, Orlando An audit “is the cheapest insurance policy you will ever buy,” says Attorney Tammy D. McCutchen, former administrator of the wage and hour division at the Department of Labor and principal at the Littler Mendelson law firm in Washington, D.C."

Compliance ROI—The Cost of Noncompliance

Last year was a record year for federal court lawsuits, says McCutchen. We broke the 8,000 mark.


Danger Zone—Discretionary and Nondiscretionary Bonuses

"Bonuses—and their impact on overtime calculations—are a focus of wage and hour enforcement. Many organizations fail to make their bonus-based overtime recalculations correctly, and that gets expensive when a large number of employees are involved."

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.


Drywaller Plastered with $600,000 Wage/Hour Judgment

"Yesterday’s Advisor presented two instructive wage and hour cases; today, a drywall company, that, in addition to a 600,000 fine, will give public presentations about the “scourge of misclassification.”"

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.


Wage/Hour Blunders You Can Avoid

"Wage and hour should be simple, but it’s not—expensive judgments and settlements are common, but they shouldn’t be that hard to avoid. Here are two cases that will help you avoid the expense and hassle of a wage/hour debacle."

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.


Danger Zone: Supervisors Allowing (Demanding) Off-the-Clock Work

"Yesterday’s Advisor showed how reviewing policies and procedures can help employers curb the potentially very expensive problem of unauthorized overtime. Today, how to train your supervisors."

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.


Yes, You Must Pay Overtime—Even if It’s Forbidden

"Like most employers, you probably have a written policy prohibiting unauthorized overtime. Such policies are fine—but you still have to pay employees for all hours they work, even if they have repeatedly violated your policy by working the extra hours. (But you can discipline.)"

This issue is the focus of many wage/hour lawsuits these days, as attorneys have come to realize that employers are easy pickings on this point. Here, from BLR’s popular guide, Wage & Hour Compliance: Practical Solutions for HR, are tips for coping with this common challenge.

Employers think they’re covered by issuing a policy, but as the U.S. Department of Labor (DOL) puts it, “An announcement by the employers that no overtime will be permitted, or that overtime work will not be compensated unless authorized in advance, will not impair the employee’s right to compensation for work which he [or she] is actually suffered or permitted to perform.”


Nonexempt Employees? 90% Chance You’re Violating FLSA

"In yesterday’s Advisor we looked at common wage/hour violations among low-wage earners. Today, we’ll look at more potentially expensive violations."

Illegal Employer Retaliation

When workers complain, and especially when low-level workers complain, many experience retaliation. For example, employers threaten to cut workers’ hours or pay, fire or suspend workers, or threaten to call immigration authorities.

Likely because of such actions, other workers report that they did not make complaints even though they had experienced a serious problem themselves. Some were afraid of losing their jobs, some were afraid they would have their hours or wages cut, and some simply thought that complaining would not make a difference.


The Agencies and Aggressive Attorneys Are Looking for Violations

"Experts say that if you look carefully enough, there are Fair Labor Standards Act (FLSA) violations in most every organization. The agencies and some aggressive attorneys are taking a look and, eventually, they’ll get to you."

Studies suggest that many employment and labor laws are regularly and systematically violated. The most frequent violations are:

Minimum Wage Violations

One survey found that about 25 percent of supposedly minimum wage workers surveyed were paid less than the legally required minimum wage in the previous workweek. Worse, the violations were not trivial: 60 percent of workers were underpaid by more than $1 per hour.


Sued by a Class of 1.5 Million? Your Suit Probably Won’t Be That Big

"Wal-Mart had to defend itself in a wage-related suit that could have had as many as 1.5 million class members. Your suit won't be that big, but maybe the prospect should spur you to review your exempt/nonexempt classifications."

Here, from BLR’s experts, are explanations of many of the trickiest classification questions:

Executive Secretary

An executive assistant to a business owner or senior executive of a large business may qualify as exempt if the employee, without specific instructions or prescribed procedures, has been delegated authority regarding matters of significance. Administrative assistants are otherwise usually nonexempt.


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