THE BASICS YOU NEED TO KNOW TO AVOID THE PITFALLS!

WAGE AND HOUR 101

Melodee M. Parker, DirectorHuman Resources, FCPSKASBO Fall 2014

FAIR LABOR STANDARDS ACT

• Fair Labor Standards Act (FLSA) is the federal law that regulates hours and wages

• State law can have additional regulations beyond the federal law

Pitfall to Avoid: Applying either federal or state law rather than the one that provides the greatest benefit to the employee

EXEMPT

• Employees that are “exempt” do not receive overtime pay

•Must meet the qualifications • Earnings Test • Salary Basis Test• Primary Duty Test

Pitfall to Avoid: Job titles do not determine exempt status.

IS BRADLEY EXEMPT?

• Bradley is a mechanic for the bus garage. His work is repetitive and routine. He has had to work several hours of overtime this last school year and his supervisor calculates his end of the year earnings are more than if he were paid on the salary schedule. Since school budgets are tight, the supervisor recommends that Bradley’s title be changed to Mechanic Supervisor and be placed on the salaried schedule as an exempt employee. His duties will not change.

NO

• A title change alone is not enough to be under the exempt status. When considering whether a position might qualify for exempt status use the “exempt vs non-exempt” checklist. Making an employee salaried does not equal exempt status• When in doubt check with your attorney,

better to be sure on the front end, that paying hefty fines and retro overtime on the back end..

NON-EXEMPT

• Includes all employees that do not meet the requirements of exemption

• Must be paid one and one-half times the regular rate of pay for each hour worked over 40 hours

• Takes “leave time” in hourly increments

Pitfall to Avoid: Classifying someone as exempt incorrectly to avoid overtime payment. Common and costly mistake!

DOES LINDA NEED TO BE PAID?

• Linda works as an administrative assistant. She is packing up to leave for the day when her boss says he needs her to revise a presentation on an emergency basis, but he is not finished with the draft yet . Linda waits at her desk for an hour, during which time she balances her checkbook and plays computer solitaire. Finally, her boss gives her the presentation and she does the revisions. She leaves the office at 7pm.

YES

• Linda must be paid for the hour she was waiting for her boss to give her the presentation even though she performed no productive work during that time. She must be “paid to wait”.

MEALS AND BREAKSLunch• Kentucky law requires employees receive a “reasonable

period” for lunch ( 30 minutes )• Close to the middle of the employee’s shift, not before 3

hours of start time or 6 hours beyond start time• Should be taken away from work area so not perceived

as working

Breaks• Kentucky law requires employer to provide a break/rest

period of at least 10 minutes every 4 hours • Employee is paid during the break time

Pitfall to Avoid: Allowing employees to work through lunch or count time at beginning or end of shift as lunch time

RECORDING TIME

• Employees should accurately record time• Timesheets should list the specific time of arrival,

departure and lunch (allowed to leave premises)

• Employers should keep a “master schedule” that includes the identified lunch/breaks for at least 3 years

Pitfall to Avoid: Generic or pre-populated timesheets being used or supervisors not ensuring that accurate start/end and break times are recorded. Everyone having 8:00-5:00 timesheets is a big red flag .

DOES LORA LU NEED TO BE DISCIPLINED OR PAID?

• Lora Lu is a cafeteria manager for XYZ school. Her job keeps her very busy, too busy in fact to ever take a lunch break. Lora Lu will eat a sandwich while balancing the food service ledger or making out schedules for the following weeks. She hasn’t complained about not being able to take a lunch break, in fact, when you discover that she hasn’t been taking lunch, she tells you she never expected to be paid for that time…that’s why she writes in a lunch time on her timesheet each day.

YES AND YES

• Hopefully, you have the sign-in sheet where Lora Lu signed that she understood she needed to take a lunch break mid day for 30 mins (and to record that time on her timesheet accurately). You will have to pay her back pay to when she tells you she has been working through lunch…this might mean you have to pay overtime if the time goes over 40 hours during the work week.

• Additionally, you should give her a verbal and written warning regarding “must take a 30 min lunch , recording time accurately and getting supervisor’s prior approval before working overtime”.

FLEX TIME

• Flex time pertains only to the regular working hours – not overtime

• Compensatory time (Comp time) pertains only to overtime hours in public sector NOT private sector

Pitfall to Avoid: Inconsistent Flex time application by supervisors or hours being made up outside of the same work week which could result in overtime pay

DOES JUNIOR GET A VACATION?

• Junior, the custodian, comes to you as his supervisor and lets you know that he will be taking all of next week off for vacation. When you remind him that he took all of his vacation time last month to hike Pike’s Peak, he lets you know that he has been coming in on Saturdays and Sundays for the last 3 weekends and is ready to “flex” his time.

NO AND POSSIBLY YES

• You have kept your records of all beginning of the year training and monthly email reminders to your custodial staff that reminds them of recording their time accurately, getting supervisor’s approval before working overscheduled/overtime hours and recording accurately on their time sheet.

• You will have to pay Junior for the six days worked, according to the hours that he says he works (unless you have cameras in the building that can show exactly when he came and left). You can give him a verbal and written warning or you can recommend termination based on Policy 03.27.

RESOURCES

An Employer’s Guide to Kentucky Wage and Hour Issues (Kentucky Chamber of Commerce)

Wage & Hour Compliance: Practical Solutions for HR (BLR)

HR Audit Checklists (BLR))

www.dol.govwww.labor.ky.gov/ www.findlaw.com/wage_law

QUESTIONS???

• Contact Information

• Melodee M. Parker• 859.381.4114• melodee.parker@fayette.kyschools.u

s