Garage and Body shop...we would like to change our mechanics from hourly pay to billed hours only.
Is this legal? What if there are no billed hours, but the mechanics have hours they clocked in/out.
My employer seems to think he won't have to pay them if there is no work, but they are clocking in/out daily.


  • 7 Comments sorted by Votes Date Added
  • Welcome to the Forum sheevans!

    If they are on the clock, you have to pay them.

    If your employer does not have enough work, he should consider sending employees home or laying people off. Do you have a policy for sending employees home when there is a lack of work? If not, it is time to initiate one. Our policy allows employees to choose between leave without pay or using PTO time. So far, knock on wood, we have not had to use it. But it is nice to know it is there and what we should do in the case of a slowdown.

    Good luck!

  • There is no company policy anywhere. The shop is small, 8 employee's.
  • I have never worked in a repair shop, but I had a cousin who did. They paid him by the piece instead of by the hour. He got 50% of everything they charged. I don't know how that exactly works, so maybe someone else on here can help you with that idea. In the meantime, here is our policy on low work activity. Perhaps you can modify it to use in your shop.

    [I]In periods of low work activity, it may be necessary to require non-exempt employees to leave work early or not report to work as scheduled. Whenever possible, an attempt will be made to place affected employees in other areas needing additional coverage.

    Low work activity (LWA) policies and procedures can be defined departmentally by the respective department manager. However, if no department policy exists, the following policy will be utilized.

    The department manager or designee will determine the shift(s), job classification(s) and number of non-exempt employees in those job classifications who are not needed based on the work activity in their work area. The department manager or designee will request volunteers for LWA. If there is insufficient numbers of volunteers, the least senior staff members in the affected job classifications will be instructed to leave work early or not report to work.

    Affected employees may use their accumulated Paid Time Off hours during periods of LWA. [/I]
  • In a previous career, we had a lot of piece-rate employees. They still had to be paid at least the equivalent of minimum wage for their total weekly hours.
  • Welcome sheevans!!!

    Nae has some very good ideas, and as Frank pointed out, make sure minimum wage laws are being followed.

    When I worked for an auto dealership our mechanics were all hourly, so I'm afraid I won't be of much help.
  • Welcome to the forum.

    Wasn't it McDonald's that was successfully sued a few years back for taking employees off the clock and sending them to sit somewhere at slow times? I believe it was decided they had to be paid minimum for all hours they were present. You could send them home, but you couldn't dock them.
  • Another way to look at low work situations is to compare the rules for on-call employment.

    Under the FLSA, if you have employees who are on-call, whether or not you must pay them for their time depends on whether they are "engaged to wait" or "waiting to be engaged." Employees who are "engaged to wait" must be paid for their time, whether they are actively conducting billable work or not. Employees who are "waiting to be engaged" must only be paid for the hours they are actually involved in activity for the benefit of the employer.

    So an employee who is able to enjoy his day at home, watching television, relaxing on the couch, but who must be available for work within a reasonable period of time upon call is an employee who is "waiting to be engaged." He doesn't have to be paid for the hours that he's watching television, but as soon as the employer calls him and disrupts his private home life and summons him back into work mode, then the pay clock begins ticking and the time is compensable.

    But take that same employee and, let's say due to the need to be able to respond urgently to incoming work, you place him "on call," but you require him to spend his downtime at the place of business. This employee no longer has the freedom to enjoy those hours for his own benefit. Now he is "engaged to wait," and those hours must be compensated. The employee's immediate availability upon being summoned to perform urgent work is a benefit to the employer.

    So in the original poster's mechanic shop example, if you need employees to be immediately available to respond to work as soon as it comes in, the resulting ability to tell customers "Sure, we'll put Employee right on that immediately" rather than "We'll call Employee in and see if he can get here in time to work on it" is a benefit to the employer. Even if that employee can spend the rest of his afternoon watching the same television show in an employee break room that he'd watch at home, by requiring him to be at the work site you have encroached on his freedom to use that time for his benefit.

    But if you send that same employee home and let him know that you will call him into work if he is needed, then so long as he has reasonable freedom to use his time off the work premises (for example, he isn't required to report back to the work site within five minutes of your call), then that time is now for his benefit and doesn't have to be compensated.

    Putting some employees on-call in this manner might be a reasonable way to keep your site staffed in times of heavy workload without having to resort to permanently laying-off employees and risking short staffing.
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