5 Tips for Reducing Wage and Hour Risk
5 Tips for Reducing Wage and Hour Risk

5 Tips for Reducing Wage and Hour Risk

Since September 2011, the Wage and Hour Division of the Department of Labor has collected millions of dollars in back wages resulting from violations under the Fair Labor Standards Act (FLSA). Could your business be next? How prepared are you for an investigation? In a recent webinar, labor and employment lawyer Seth Briskin provided tips to help you stay compliant with federal and state laws.

1. Audit your policies and practices

It’s crucial that your business take compliance seriously, from the C-suite to entry-level employees. Management must create, communicate and enforce policy, and employees must understand that following those policies is not negotiable. Here are a few best practices:

* Prohibit off-the-clock work. More and more courts are awarding back pay for time employees were suffered to work through meal periods or by checking e-mail and taking phone calls during non-work hours.
* Demand accurate timekeeping practices. This sounds simple, but it has to be reinforced. A clear policy should be stated in your handbook, and supervisors must be expected to oversee this.
* Make sure to calculate overtime properly. For example, non-discretionary bonuses and room and board have to be treated as wages when businesses calculate OT.

2. Verify your employee classifications

Classifying employees as exempt, non-exempt or independent contractors is one of the biggest pitfalls employers face. Remember: a job title means nothing. The classification is based on what an employee actually does every day. The best starting point is an accurate job description, which might be created only by literally spending several days with an employee to see what his or her daily work truly comprises.

3. Improve your record-keeping practices

Accurate, detailed and supervisor-reviewed timecards are a must. Whether you use thumb scanners, punch clocks or a web-based system, the law requires you to have accurate time records. Those records are your best defense against a lawsuit or DOL audit.

4. Provide wage and hour training for HR, supervisors and employees

This is essential! Supervisors can be an employer’s worst enemy if they’re not properly upholding wage and hour law and policy. You and your business are legally bound to the decisions your supervisors make every day on the job. Thus, they must know the law—and must be held accountable for following it.

5. Create an open-door complaint reporting system

If something is wrong, you want to know about it—and well before the DOL does. The minute you find a problem and fix it, the clock is in your favor because of statutes of limitations on DOL fines and penalties. The key to finding the truth is creating a system for employees to report issues without fear of retaliation from supervisors or upper management.

To hear more from Seth Briskin, watch his recent webinar.

Paycor provides a number of solutions that help businesses stay compliant with labor laws, including:

* Time and Attendance allows you to view and change employees’ schedules and generate custom reports to track hours worked and manage labor costs.
* The HR Support Center offers forms and templates for job descriptions, policies and employee handbooks so you never have to re-invent the wheel.
* Paycor’s HR application provides tools for training administration, document archiving and employee communication through a secure portal.

Contact Paycor to learn more about how we can help keep your organization out of hot water.

More to Discover

What is a W-4 Form?

What is a W-4 Form?

What is a W-4 Form? W-4 forms are essentially very basic tax returns filled out by employees. Specifically, it tells employers the correct amount of tax to withhold from the employee’s paycheck. Need a W-4 Form? Download it here. Why are W-4s important? The accuracy of an employee’s W-4 submission will determine the size of their tax refund (or bill) at the end of the year. The amount withheld should be as close as possible to their actual tax obligation—a big deficit can be an unwelcome surprise and may be accompanied by further penalties. Withholding more than necessary is considered by some employees as an easy way to save but, while refunds may seem like a nice treat, you are taking away the chance for employees to invest (or use)...

Case Study: Price Brothers, Inc.

Case Study: Price Brothers, Inc.

A need for robust reporting tools and a modern HR and payroll platform with onboarding capabilities led Price Brothers, Inc., to Paycor. “We’re constantly hiring and looking for skilled trade help on a daily basis. Now they can fill out the application online and we can email them the new-hire paperwork. They can complete everything online before their first day.” - Kim McLaughlin, CFO, Price Brothers, Inc. Why Price Brothers, Inc., left their payroll provider Price Brothers, a Charlotte, N.C.-based plumbing contractor who specializes in new-home construction, needed a more modern HR and payroll platform that could keep up with their growing business. Their former solution wasn’t intuitive and didn’t collect all the data they needed for...

How to Pay 1099 Employees

How to Pay 1099 Employees

As the gig economy grows more employers are looking to hire independent contractors (aka 1099 workers). But since paying independent contractors isn’t a walk in the park, many employers are looking for step-by-step instructions. Here’s a breakdown of everything you need to know: How Do I Pay a 1099 Worker? This subject is something you will need to discuss in detail with the person you’re hiring for the job. Often, they will have a written contract that stipulates how and when they should be paid. The two most common methods of payment are hourly and by the job or project. Some independent contractors — such as attorneys — prefer to be paid on retainer, which means you pay them a lump sum at the beginning of each month in return for a...

States with Salary History Bans

States with Salary History Bans

Requesting job applicants’ salary histories has been a pretty common practice for employers over the years. Recruiters and hiring managers often use this knowledge to exclude people from the candidate pool, either because the applicant is “too expensive” or their previous salary is so low, hiring managers think the person is poorly qualified or inexperienced.Businesses have also used previous salary information to calculate new hire compensation—a process that can perpetuate pay disparity between women and men. To address this inequality, several states and municipalities have enacted bans on asking for previous salary information, although laws vary in terms, scope and applicability. The states and territories that have enacted salary...