By Sandy Seay

9/19/2013 - Tales from O’Seay’s Fables . . .

Hilda and Milton are non-exempt, hourly paid workers. Ethyl is an exempt, salaried worker.

Hilda was a pretty good worker and the management team held her in high regard. But she was a stickler for detail and some would say she was a perfectionist. When Hilda did work, it had to be “right.” To make sure it was “right,” Hilda often took work home with her at the end of the day, unbeknownst to her employer. Hilda didn’t expect to be paid for this time, she just did it to make sure her work was “right” and that she had everything under control. It made her feel better and more comfortable.

Milton was not the company’s best worker. He was slow in completing his work, was always behind and made frequent errors. One of his co-workers commented that his service tray was not always in the full, upright and locked position. On the other hand, he had a pretty good attitude and really wanted to do a good job. To catch up, Milton often took work home at night, mostly work that he was unable to do during his regular workday. He felt that if he could get his work done at home, his boss wouldn’t find out that he was behind.

Ethyl was an exempt manager and understood that she was paid to get the job done and not for the number of hours she spent on the job. Ethyl took work home at night and often worked on the weekends. She was a conscientious, good and effective manager.

One day, the Wage and Hour investigator knocked on the door and began to question employees. “Ever take work home at night,” he growled? “Yes,” said Hilda. “Yes,” said Milton. He didn’t even bother to talk with Ethyl.

What Is The Problem?

According to Wage and Hour regulations, “work time” for non-exempt employees is any time an employee is working, even if the employer hasn’t approved it and even if the employer doesn’t know about it. So, in the cases above, both Hilda and Milton were engaged in working time, time that should have been recorded and paid for, even though the employer did not know they were working at home and would not have approved it.

Hilda was a good, conscientious worker and was taking work home in attempt to do a better job for the company. Milton was taking work home because he wanted to do a good job but was unable to complete his assigned work during his workday. One could argue that, in both cases, these employees had an admirable objective, which was doing a good job. However, in the event of a Wage and Hour investigation, the company would have had a huge “working time” exposure that would include back wages and penalties going back for 2 or 3 years.

Ethyl, however, was an exempt employee, so her compensation was not tied to her hours of work in any way. Exempt employees are paid for the job itself, not for the hours of work spent on the job, so the Wage and Hour regulations on “working time” would have no impact on her and the company, if she took work home at night or on the weekends.

Recommendations on How to Avoid “Working Time” Exposure

First, recognize that this is a major red flag for a Wage and Hour investigator. In the case of our friend Hilda above, she did not want to be paid for this time and did not expect to be paid for it. However, I have often said that employees love us until they don’t love us anymore. If Hilda gets upset with the company, or if a Wage and Hour investigator tells her the company owes her $1500, things might change.

Second, you should have a written policy, included in your employee handbook, that clearly states, “Employees are not allowed to take work home at night, nor to work more than 40 hours per week, without express authorization from their supervisor, in advance.” If employees violate this policy, we still have to pay them for the time worked, but they are subject to disciplinary action and, if it continues to occur, perhaps even dismissal. This policy needs to be clearly communicated to employees.

Third, in some way, we have to monitor this situation by making sure employees are not taking work home at night. We can do this by observation, talking with employees and generally monitoring their work. I suppose it’s possible that an employee might “sneak” some work home at night, but in our experience, this is rare. If we let employees know that our policy prohibits homework, unless authorized, and if we include this policy in our employee handbook, the odds are very high that we will have resolved homework issues, in very large measure.

Fourth, we should include a clear definition of “exempt” and “non-exempt” classifications in the company’s employee handbook. Language like this would be best:

“Exempt employees are those who do not keep a daily time record, do not receive overtime compensation and are paid by a salary, regardless of hours of work. Non-exempt employees are those who maintain an accurate record of their hours worked each day, who receive overtime compensation for all hours worked in excess of forty per week, and who are paid an hourly rate.”

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