FLSA guidelines for your pressing payroll questions

by on April 2, 2009 · 0 Comment POSTED IN: HR Info Center

FLSA guidelines on worker status, paid time, and overtime calculations

PDA may soon stand for ‘PAY DAMAGE AWARD’ in FLSA guidelines?

Are you asking for wage-and-hour trouble by giving out Personal Data Assistants to employees? According to the Workplace Prof law blog, lawyers are telling corporate clients they may run that risk if they don’t have a policy on company-owned PDAs.

Without restrictions on off-hours use of Blackberries and other PDAs, employees can potentially put in big chunks of time on these devices and then claim it as overtime under FLSA guidelines.

Solution: Give PDAs only to those who are exempt from FLSA overtime regs. If you must give them to hourly workers, explain that after-hours use must be authorized in advance, just like overtime, to be compensable.

Blog at: lawprofessors.typepad.com/ laborprof_blog

Degree of control determines employment status in FLSA guidelines status

Workers can’t be paid as independent contractors if the employer exercises substantial control over their work, DOL reminds us.

The reminder took the form of a $75,000 back overtime award to 76 workers for an Ohio construction firm. Under FLSA guidelines, they were wrongly classified as independent contractors.

Cite: DOL v. Miami Valley Construction Enterprises

FLSA overtime calculation sinks employers

It’s not uncommon for employers to calculate overtime based on a two-week pay period, but it can be a mistake.

Under the law, if a non-exempt employee works 20 hours in week one of a two-week pay period and 42 hours in week two, she is entitled to two hours of overtime pay. In this case, laborers working odd hours were denied overtime for weeks in which they worked more than 40 hours.

The employer had to pay $84,964 in back wages to 127 employees.

Cite: DOL v. GreenTen Corp.

Sales reps were misclassified under FLSA guidelines

You can call an inside sales representative “Executive Vice President of Sales” or anything else your heart fancies. But you may not call her an exempt employee unless she passes the FLSA exemption test

When DOL investigators looked into Homestore Inc.’s sales operations, they found 435 inside advertising salespeople who had been misclassified and denied overtime pay.

The employer agreed to pay $1.2 million and reclassify the employees.

Cite: DOL v Homestore

FLSA guidelines cover jointly hired workers

Employers who jointly hire workers can’t point fingers at each other to squirm out of paying overtime.

A management firm and a hauling company jointly hired drivers who routinely worked more than 40 hours a week.

But since neither employer required anyone to work overtime hours, neither paid overtime per FLSA guidelines.

One of the shortchanged drivers complained to the DOL’s Wage and Hour Division.

DOL held that as joint employers both were responsible for violations of overtime law. The case was settled; the firms agreed to pay $26,868 in back overtime.

Cite: DOL v. ORBIS Management Group and ABCOR Enterprises

The plan to avoid FLSA overtime law wasn’t subtle

A company that wanted to avoid overtime didn’t beat around the bush.

According to DOL, the Oregon firm simply told employees to record fewer than 40 hours a week on their time sheets regardless of how many hours they actually worked. Result? The company must pay $23,000 in back overtime and damages.

Cite: DOL v. Metro American Homebuyers

Shift bonus is calculated for overtime in FLSA guidelines

An Iowa company forgot about shift differentials when calculating overtime pay, and a court ordered it to make up the difference.

The company paid overtime based on pay rates before the differentials for second and third shifts. As a result, second shift people were shorted 10 cents an hour and third shift people 15 cents when they did overtime.

Hundreds of workers at the 2,100-employee company may have been affected over three years.

Cite: Bell v. West Liberty Foods

Split weeks in FLSA overtime rules don’t exempt workers

An employer couldn’t escape paying overtime by splitting up workers’ weeks among facilities so they never worked more than 40 hours in one place.

DOL socked the employer, which operated 13 residential care locations, for $637,000 in back overtime. When different facilities are owned by one employer, it’s the aggregate work time that counts under FLSA guidelines, not the time at each.

Cite: DOL v. Beaumont Care Center.

Short overtime pay disguised as bonuses

A Georgia company underpaid for overtime and tried to disguise the short payments as bonuses.

DOL says that after the firm was caught violating FLSA guidelines it agreed to pay $574,500 in back overtime to 193 fence installation workers.

The workers were paid straight time for hours over 40, and payroll was doctored to make the payments look like bonuses.

Cite: DOL v. Atlanta Erosion Consultants.

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