Do You Have A Lurking Wage-Hour Problem?
Kegler Brown E-mployment Alert January 27, 2010
Technology is changing our lives. Employees can stay connected with the office and with customers every hour of the day. Attention to e-mails, voicemails, text messages, and electronic document transfers can similarly occur from various places and at various times. Some employers require their employees to work away from home and/or after hours; others encourage but do not require the activity; still others have no idea whether their employees are working after hours or not.
For salaried employees, who are legitimately exempt from FLSA overtime requirements, this off-duty work is usually not a problem. (The exception to this general statement occurs when a salaried employee is off work for a full week, such as a furlough, and the employee performs some random duties, like answering a few e-mails or making some calls. In order to maintain the employee’s exempt status, their full salary must be paid in any week in which they perform any work, or conversely, they must do no work during the week they are off.)
However, when non-exempt employees perform work outside normal reported hours, an overtime violation often occurs. Under the FLSA, employees must be compensated for any time that the employer requires them to work. In addition, the FLSA requires that employees must be compensated for any time when the employer “allows,” or “suffers,” or “permits” them to work, whether or not the work was specifically required or requested. When the off-hour work is added to normal work hours, it generally results in overtime that is worked but not paid. Over a period of time, and with a number of employees involved, the overtime obligation can become substantial.
It is the employer’s duty to control when and how work is performed. To make matters worse, proof of the fact and amount of off-duty work is generally easy to generate, since the electronic tools usually create a stored record of the activity.
Some employers have responded to this potential liability by restricting off-duty access to company computer systems to exempt personnel. Others have restricted company-issued phones, PDAs, etc. to only exempt employees. At the very least, employers should have written policies or directives that (a) prohibit non-exempt employees from performing work during off duty hours, and/or (b) requiring that any off-duty work be reported for payroll purposes.
The “lawsuit du jour” for many plaintiff-employee attorneys is a class action alleging FLSA overtime violations. Don’t let inadvertent off-duty work result in you answering to the name “defendant.”