Sins of Wage and Hour Management


Wage and hour management should be simple but it's not! Here are some common "sins" as discussed in the HR Daily Advisor:

1. Failure to pay the minimum wage - All employees are entitled to receive at least the minimum wage for all hours worked. Special arrangements may be made for some positions (like wait staff as long as tips put them above the minimum wage) and in specific training situations.

2. Failure to pay for all hours worked - Employers must pay non-exempt employees for all hours worked, even if the employee has volunteered to do the work without pay, and even if you have forbidden the employee to do work. In that case, you will discipline the employee, but you still have to pay for the hours worked. Some violations are blatant, like “clock out and continue working” but some are not so obvious. For example, expecting non-exempt workers to take customer calls off hours, or insisting that they answer the phones during an unpaid lunch break.

3. Misclassifying as exempt - Employers sometimes want to classify workers as exempt to avoid paying overtime and/or to avoid paying for extra hours worked. Unfortunately, an employee’s title doesn’t mean anything, and the fact that the person is paid on a salary basis doesn’t mean anything – it is the job duties that determine whether a worker is exempt or not. There are very specific guidelines from the Department of Labor for the main types of exemptions – administrative, executive, creative, and outside sales.

4. Forgetting state law - California law: overtime is one and one half the employee’s regular rate for hours worked in excess of 8 hours a day or for the first 8 hours worked on the seventh consecutive day worked in a workweek and over 40 hours in one week. Double time must be paid for hours worked in excess of 12 in a workday or worked in excess of 8 on the seventh consecutive day worked in any workweek. All travel time is paid time (under federal law, only travel time that coincides with the normal work day is compensable).

5. Making "side agreements" - An employer tells an employee to work off the clock this week and he will make that up to them next month. Agreements like this violate the FLSA. Employees cannot waive their right to overtime or pay for hours worked – even if they agree, even if they are eager to help out by doing a little work on the side without pay.

If you are interested in an in-depth discussion on these topics or if you need assistance in the above-mentioned areas, please contact HR Advisors.


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