Last month I wrote about how mis-classifying employees as independent contractors can result in a company’s being sued and having to pay $$$ in back wages and fines.
Today I’m writing about a related subject that can also blind side a company resulting in paying back wages and fines and penalties.
I’m referring to the issue of not paying employees for the overtime they work, which would be a violation of the fair labor standards act (FLSA).
A business should have a policy that describes what its overtime policy is. The following is an example of such a policy provided by the National Federation of Independent Businesses.
“Although we appreciate that you made yourself available to work overtime, please understand that working unapproved overtime may have significant budget implications and consequently violates company policy. Despite our prior discussions instructing you not to work overtime without your supervisor’s prior approval, you have again worked unauthorized overtime, which will be paid to you at the time-and-one-half premium rate. However, please understand that failure to obtain appropriate advance approval in the future may result in further disciplinary action up to and including dismissal.”
You should review your overtime policy with each employee ensuring they understand that working overtime without obtaining prior approval is a serious matter. While the employee may get paid for working the overtime, even if it wasn’t approved, the employee should also know that it could also get them fired.
If you would like help with creating an overtime policy contact me.
Torus Law, PLC