Everybody’s got too much to do these days, and the overtime can add up fast. But you’ll probably want to check your current pay policies and procedures against a new ruling from the Department of Labor. You may owe more than you think.
You can see how it happens, especially these days:
A staffer is neck-high in aging reports, slogging through the growing list of past-due customers. The next time he looks up, it’s 2:30 — there goes lunch for today!
But what does that nonexempt staffer’s situation do to another finance department: Payroll.
That’s what one employer wanted to find out when it requested a ruling from the Department of Labor (DOL). Here are the facts in this particular case, and how you can use it to keep your own company’s pay practices in compliance.
Had to report when working through lunch
This particular organization had a specific meal and break policy. It required that all employees who work six or more hours in a shift were required to take a 30-minute meal break, which was unpaid. The policy also specified the meal plan should not be waived.
Of course, the employer also understood that sometimes expanding workloads spill into people’s lunch times. So it put in a provision that if an employee did work through a lunch period, that the person must mark that on his or her timecard so the company can pay the person for it.
But what happens when the employee fails to notify his or her manager about the extra work?
Here’s what DOL said:
The company must absolutely compensate the employee for that time worked, whether or not the stated policy was followed.
Of course, the DOL reminded, if that additional time still puts the staffer within the 40-hour workweek, there’s no need to pay overtime.
But what if your company, in an attempt to keep costs down, decides to institute a policy that no employees can work more hours than they’re scheduled to?
This company wanted an answer to that too, and included it in its request for ruling from DOL.
The feds’ position was the same: Your company must pay employees for all hours they work, even if you discourage the extra time. That includes coming in early and staying late.
And if that extended day pushes them into overtime territory, get ready to open your wallet wider — nonexempt employees get the additional pay (usually at a higher rate).
Learning for everyone
This is critical for all supervisors to understand. Even if an employee goes against company policy by working longer than he or she should, your company cannot deny pay to that person.
It’s something that’s more critical than ever to reinforce.
As more companies are feeling pressure to do more with less, there’s an increasing number of staffers who may feel like they can’t get their job done in the regular workday. Encourage managers to tell their people to raise a hand if they’re feeling that way.
Maybe there’s an opportunity to shift some responsibilities without jacking up your payroll costs.
Cite: FLSA 2008-7NA (May 15, 2008).
Note: While DOL rulings are for the specific organization that requested them, they do give you an idea how the feds are leaning.