Tag Archives: Wage & Hour Law

Is Your Company’s “Flexible Scheduling” Policy a Violation of Wage and Hour Law?

Contributed by Amanda Biondolino, October 25, 2017

An employer who allows its employees the “flexibility” to self-schedule time off the clock must make sure that it is paying its employees for all time worked. And beware, under the Fair Labor Standards Act (FLSA), “hours worked” is not limited to only that time an employee spends performing his or her job duties. Short breaks of twenty minutes or less are also counted as hours worked and must be paid.

The Third Circuit Court of Appeals recently held as a bright-line rule: Where breaks of twenty minutes or less are in question, the time must be paid. The court adopted the U.S. Department of Labor policy rationale that “breaks of twenty minutes or less are insufficient to allow for anything other than the kind of activity (or inactivity) that, by definition, primarily benefits the employer.” There will not be a factual analysis, or a case-by-case determination. Simply stated, if an employee is at the worksite, and is taking time away from their work-related duties for twenty minutes or less, they must be compensated for that time.

In the case decided by the Third Circuit, the employer did not deny that it permitted its call-center employees to log off their computers and use their time free from any work related duties, but it refused to call those time periods “breaks.” Rather, the employer considered it part of a “flexible time” policy, in which employees could take an unlimited amount of unpaid time away from work at any time, for any duration, and for any reason.

The court rejected the employer’s attempt to characterize time in a way that deprived employees of rights they were entitled to under the FLSA and considered the time an employee spent logged off the computer as a “break.” The employer violated the FLSA by not compensating employees for breaks that lasted twenty minutes or less.

Bottom Line: This is a reminder to employers that all policies and procedures should be vetted by experienced labor and employment counsel. In addition, all time worked including break periods should be accurately recorded, not only to comply with the record-keeping requirements of FLSA, but to document any abuse.

Employers should also keep in mind that some states may have their own break requirements that employers in those states must follow. Therefore, it is imperative that employers review their break policies and check applicable laws to ensure compliance with both federal and state law.

Although federal wage and hour laws do not generally mandate employee breaks, and state laws may vary, a strict policy that forces employees to choose between getting paid and basic necessities such as using the restroom runs contrary to “humanitarian and remedial” purpose of the act and will violate the law. These kinds of short breaks must be compensated. The FLSA and corresponding state wage and hour laws are designed to protect employees, and will be liberally construed.

 

 

President Obama Directs United States Department of Labor to Revise Wage & Hour Law

Contributed by Jeffrey Risch and Kelly Haab-Tallitsch

Earlier today, President Barack Obama signed a Presidential Memorandum directing his Secretary of Labor to update the regulations to expand the number of employees eligible for overtime under the Fair Labor Standards Act (FLSA). The president was expected to take more specific action based on statements made by White House personnel earlier this week, but he left virtually all of the details to the United States Department of Labor.

The president set the stage for the Department of Labor to narrow the exceptions to the FLSA by discussing the failure of the executive or professional exemption to keep up with inflation. Commonly known as the “white-collar exemption,” the provision allows employers to classify many workers as executive, administrative or professional, and exempt from the overtime laws.

Under the current federal exemption, generally these salaried workers do not have to be paid overtime if they earn no less than $455 a week and provided their day-to-day duties meet certain qualifications. This $455 level was raised in 2004 by the Bush administration. The president criticized the level, but did not propose it be raised to a specific amount, as had been expected. Economists allied with the White House have previously proposed doubling the current threshold to $1,000 a week which, when adjusted to inflation, would make it similar to the original threshold set in 1976. A change this drastic could require employers to pay overtime to millions more employees.

The Presidential Memorandum instructs the Secretary of Labor to update regulations regarding who qualifies for overtime protection to:

  • Update existing protections in keeping with the intention of the Fair Labor Standards Act
  • Address the changing nature of the American workplace
  • Simplify the overtime rules to make them easier for both workers and businesses to understand and apply

Any new requirements aren’t expected to go into effect until at least 2015. The Department of Labor is not expected to have a recommendation before the fall. Fortunately, any proposed changes would be subject to public comment before they can be approved. As a politically charged initiative, the suggestion of expanding overtime eligibility is already receiving significant attention from all sides and it is possible that strong opposition could cause the administration to scale back any proposals.

As this topic moves to the forefront, employers can prepare by:

  1. Reviewing their current classification of employees as exempt or nonexempt under the current FLSA regulations and state law to ensure current compliance.
  2. Reviewing pay policies and work rules to ensure current compliance and identify any that may need to be updated.
  3. Ensuring processes are in place to track hours worked.

We will continue to monitor and communicate further developments as they occur.