By Chris M. Mason, Attorney, Jennings, Strouss & Salmon, P.L.C.
Continuing our Arizona Restaurant Week series, below are wage and hour tips for managing non-exempt employees and avoiding costly fines and litigation in the workplace:
Tip 1: Non-exempt employees should always be considered “on the clock” when performing job related duties
Wage and Hour laws dictate that non-exempt employees must be paid at least minimum wage for every hour worked, along with overtime pay when they exceed 40 hours in the workweek. Employers should recognize that any work performed for the business needs to be compensated. For example, an employee can’t “clock out” and then perform other tasks, such as rolling silverware, counting money drawers, or emptying trash.
Tip 2: Employers cannot allow employees to voluntarily work without compensation
Employers should never permit an employee to work unpaid, even if the employee volunteers to do so. Although it may be tempting for employers to accept such offers to keep labor costs down, it can come back to bite them later if the employee is let go or otherwise leaves disgruntled. Those claims of volunteerism will not protect an employer from having to provide compensation and perhaps pay additional fines and court costs.
Tip 3: Employers should remind employees to review paychecks and timecards for pay and time discrepancies
Employers should instruct employees, and include provisions in the employee handbook, on reviewing timecards and paychecks, and how to report any pay or time discrepancies, as well as impermissible paycheck and salary deductions. These small measures may amount to avoiding big legal issues.
Tip 4: Employers must pay non-exempt employees overtime for the week in which the overtime is worked
Failing to compensate a non-exempt employee for all hours worked in a single workweek is unlawful. Most employers cannot use “comp time” from one week to the next in place of paying earned overtime or “bank” overtime hours as additional leave time. For example, if a non-exempt employee works 46 hours in one workweek, the employer cannot apply those additional six hours to the 20 hours the employee works the following week. Also, those additional hours cannot be added to an employee’s vacation pool. Employee overtime pay is evaluated on a weekly basis in most industries and for most employers, including those in the restaurant industry. Thus, employees who work overtime in one workweek must be paid overtime pay for those extra hours. Paying the employee for hours not worked the following workweek does not satisfy legal requirements.
Tip 5: Employers must compensate non-exempt employees for short break periods of 20 minutes or less
Generally, break periods of 20 minutes or less are considered compensable. Employees who are regularly required to prematurely end their break to resume work on a seconds’ notice, as well as those who may be expected to do so on occasion, must be compensated for the break. Unless the employee is consistently guaranteed a break without interruption or an expectation to resume work early, the break needs to be paid as if it were work time.
Tip 6: Employers are obligated to compensate for overtime and “off the clock” work, even if it was not approved
An employer that discovers an employee has failed to report overtime or work performed off-the-clock is still responsible for compensating the employee for the additional time worked. Even if the employee’s conduct violates company policy, which should be addressed, it does not negate an employer’s obligation to pay the employee for extra hours or overtime.
Tip 7: Employers generally must compensate non-exempt employees for travel time between work sites during the work day
An employee cannot be docked time due to travel when it is during regular work hours or during a continuation of the work day. For example, if a bartender works four hours at one restaurant and then drives to a second location run by the same employer for another four hour shift, the employee is to be compensated for the eight hours or work plus the time to drive from one location to the other.