You know there are ways employees can take some little liberties with the hours they work to pad their paychecks at your company’s expense. But what happens when it’s your supervisors who are shaving employee hours?
That’s the situation fast food giant McDonalds is currently accused of. An employee at a Syracuse, New York area restaurant is claiming his manager altered his timecards to avoid paying him overtime.
And it stands to get worse: The employee is now seeking a class action status for his claims.
That could prove very expensive for the employer.
When the heat is on they make the wrong choice
Unfortunately it’s easy to see how this could happen these days. Supervisors have been under pressure for years now to operate as lean as they can. Some of them even have their own compensation packages riding on it. Overtime represents a major expense.
So a less-than-scrupulous supervisor looking to come across as a cost-conscious leader may be tempted to take a little time off his or her people’s hours.
However, there are plenty of other ways companies may run afoul of the Fair Labor Standards Act (FLSA) – and they’re a lot more innocent.
The McDonalds situation serves as a great entre to start this conversation with supervisors and to review the scenarios that could possibly land your organization in hot water.
These three behaviors can be considered pay shaving and aren’t allowable under federal pay laws, remind the folks at FindLaw.com:
Scenario 1: Paying less than time and a half for overtime hours
Mary is working some extra long hours for a few weeks during W-2 time. She tracks and records all the time she worked and your company pays her for it, but at her regular hourly rate.
No go, say the feds. You must pay that employee at a rate of time-and-a-half for the hours worked beyond her regular workweek.
Scenario 2: Supervisors offer time off or gifts instead of overtime
Tim worked some extra hours over a span of several weeks during a special project. Instead of overtime, your company “pays” him in comp time to use whenever he wants.
Another no-no. Yes, some companies offer their people comp time, and there’s nothing inherently wrong with that. But it can’t be used to escape overtime responsibilities. After all, overtime is paid at a 50% higher rate than the usual rate of pay. Compensating with time would fall short of the appropriate pay rates.
Same goes for substituting gifts of any sort for overtime pay. More “creative” compensation solutions don’t pass muster in the feds’ eyes.
Scenario 3: Not paying for work done during breaks
James is required to take two breaks during the course of his workday. But when a large order needs to be fulfilled, he worked right on through on the production floor. However, he isn’t compensated for that time.
That’s a violation as well. Granted, federal law doesn’t require employees to be paid for breaks. But if they work during them, supervisors must understand that they have to be compensated.
Offer scenarios as a training tool
Of course if you ask supervisors they’ll tell you that everyone is being fairly and correctly compensated.
Think about adapting scenarios like the ones above to your specific company situations. When people can see just how things would pay out in their own company, you just may catch something before it becomes an expensive headache.