Up until recently we have treated all of the staff of our privately owned, 30 employee, company as salaried employees. We are all paid once a month but I understand that overtime works within a week not a month. No one was ever docked for minimum time missed nor paid for overtime worked. Per our labor law attorney we got a list of exempt vs non-exempt employees and distributed time sheets to the non-exempt employees. Generally, no one works overtime unless it is a cashier and she can't balance her drawer or an employee volunteers to come in on a Saturday to play "catch up". Are we expected to pay overtime to employees who can't keep a more than reasonable amount of work caught up or to a cashier who made an error during the day and can't balance her drawer? We are seriously considering time cards now and paying those employees hourly, docking and paying as necessary. I know this will upset employees because if it were added up they miss more time and get paid than they work and don't get paid. We also added to our employee handbook that no overtime will be paid unless it is prior approved and written by the branch manager. Can anyone provide some advise for me. I don't want to upset employees nor do I want to worry about overtime.


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  • You will need to remove the statement from your handbook that states that employees will not receive overtime pay unless previously authorized by a supervisor. This statement is in violation of the FLSA. As seen in the overtime regulations, any time that an employee is required or permitted to work is compensable. Therefore, you will need to pay them and discipline them accordingly if they did not seek authorization.

    Additionally, you must compensate the cashier who does not balance at the end of the day and stays to figure out their errors since they are working during this time period. You will also be responsible to pay any non-exempt employee coming in on a Saturday to get caught up since you would be hard pressed to set forth the "volunteer" argument with the Department of Labor.

    Check out the link below for futher guidance and best of luck. Your employees will learn to adapt as will you.

  • First and foremost thank you for your reply. Secondly, my attorney is the one who added that line to my handbook or okayed it. I was not aware it was against FLSA. Thanks again.
  • KKOEHLER: You should recommend to the senior leaders that HR needs a different attorney, one that knows FLSA especially the EXEMPT/NON-EXEMPT pieces.

    It is not ok to just pay a salary to everyone and consider everyone as EXEMPT from the FLSA. You or someone needs to do a real audit of your positions to determine who is EXEMPT and who is non-exempt.

    The fact that someone can not balance their drawer and must stay late to get it balanced is a performance issue. The Bank, I assume, does not have the liberty to declare that this person will not be paid when it is her/his fault that a drawer does not balance. The Exempt can come and go all day long, including week-ends but the non-exempt can also volunteer to come in and do work, but when they do their time must be recorded and paid for the time worked.

    Each week of a month stands alone for pay purposes: we pay weekly, so we don't have to worry about this. In my previous HR position we paid Bi-weekly but the hours spent doing the work stood on their own. Meaning you can not mix the hours in one week to calculate pay in the 2nd week.

    I have never been in a private organization that pays by the month. I assume you can do that but every hour must be calculated in the week in which the bank permitted the work to be accomplished.

    This is basic HR 101 material and your attorney is evidently not in the know or he failed HR 101 basics.

  • Thank you for the web site info. It was very helpful.
  • I would certainly use time cards, especially for the nonexempt employees. The DOL would expect as much should they ever audit your pay reords. Do that as soon as you can. Explain that you are doing it to be compliant the labor laws, meaning federal (FLSA) and state (Wage and Hour).

    If a nonexempt employee works more than 40 hours in a work week, you owe them overtime. You pay them even if they worked it unbeknownst to you and even if it was against your wishes. If they worked the hours, you have to pay them.

    When you have people earning OT because they need to "catch up" or because they "made an error during the day", you treat these as performance issues and follow your disciplinary steps all the way to termination if you have to.

    The DOL does not treat wage and hour issues lightly. Their fines make OSHA fines look like milk money. kkoehler, I think if you explain to your employees why you are doing what you are doing and the consequences to the company and the employees of NOT doing it, they'll understand. They might grumble, but they'll understand. If you are fair and consistent with your people, you'll do fine.

    Good luck.
  • Just wondering...since this will be your frist effort at keeping track of hours worked... how to you manage your meal and break times? These too can easily run you afoul of the regulations.
    Good luck...
  • Currently we pay for two 15 minute breaks but we wouldn't pay for lunch if we went to time cards. Right now, everyone is paid a set salary. Should employees count their 15 minute breaks as time worked?

    We are pretty linient around here. Often times, breakfast is bought by the company, mid afternoon ice-cream with fellowship time to eat it together,and many times lunch is purchased by the company. We have a rather relaxed atmosphere and the boss doesn't mind so long as everyone respects what their responsibilities are and gets them done.
  • Yes; the company does pay for 15 minute breaks simply by not counting the breaks taken as seperate over the course of an 8 hour work day. The meal break is not paid; but you need to make sure the individual is not at their cage counting drawer monies or answering the telephone or washing the windows or anything else that the company has a need to be done for the companies' benefit.

  • Have you defined both your work day and workweek? Our's is 12:00 am - 11:59 pm is the day and Sunday 12:00 am - Saturday 11:59 pm is the work week. By defining it, it allows the overtime clock to stop based on our definition, even in crazy California! The others posters have given great advice. When in doubt, pay the overtime and discpline the employee for not getting their work done. The price of the overtime will be far less than the penalities should you be audited.
  • Another website you might visit is : [url][/url] this is the DOL's FairPay Overtime Initiative site.
    Good luck...
  • You may have another option rather than paying overtime. We've implemented transient flex scheduling, which was originally started with the idea of allowing attendance at evening meetings without getting into a 40+ hour work week (regular = 40 hours per week for us). If someone reaches 36 hours by the end of the fourth work day, tell them they only have to work 4 hours the fifth day. If possible, let the employee choose which hours to work during your core business hours. We've got lots of office workers, so they could choose morning (8A-12P), lunch (10A-2PM), or afternoon (1-5P), or even a split shift. (If they end up not working the four hours, they request paid time off.) This also works if you need someone to come in on the weekend - give them time off during their regularly scheduled work week.

    Of course, if you're in an industry where everyone -has- to be at their post for their entire shift (customer service, factory line worker, etc.), this probably wouldn't work for you.

    Please note this is NOT "comp time." Compensatory time is available in Missouri only for firefighters and police officers and such. Comp time is accrued over a period of weeks or months, and they get time and a half off in compensation for working over their schedule.

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