EmploymentSource™ Newsletter June Edition 2012 Edition
While blackberries and smart phones have exponentially increased the ability of employees to conduct business and perform work at any time or place, these emerging technologies have also drastically increased the potential exposure for employers for off-the-clock work performed by non-exempt employees. Specifically, e-mail, the use of smart phones, and other portable communication tools have challenged the traditional notion of overtime. As more employees use these devices, employers are faced with several critical questions regarding legal compliance with the Fair Labor Standards Act (FLSA). Technological advancements that enable employees to work from off-site locations have increasingly blurred the distinction between work and home and begs the question, when is time “off” really off? Requiring non-exempt employees to handle work-related emails, texts, and telephone calls without recording the time as worked could result in payment of lost wages, liquidated damages and attorneys’ fees.
The Fair Labor Standards Act is enforced by the Wage and Hour Division of the Department of Labor. The FLSA provides that employers pay employees one and one-half times their regular wage for any hours worked over the standard work week. This general requirement for overtime compensation has many exceptions and “white-collar exemptions.” One critically important requirement running throughout the statute, however, is that non-exempt employees must be paid overtime “for all hours worked over 40 in a workweek. 1 ” This includes all work that an employee “suffers” or is “permitted” to work. 2 Essentially, any activity that an employee performs for the primary benefit of the employer constitutes compensable work time.3
Working outside of a non-exempt employee’s scheduled work time is generally known as working “off-the-clock.” Employers’ failure to pay for off-the-clock work is one of the most common violations of wage and hour laws. Examples of common off-the-clock work are:
- Email or text communications outside of scheduled work hours.
- Work performed remotely on computers outside of scheduled work hours.
- Time spent checking emails and voice messages as required by employer.
- Performing online training outside of scheduled work hours.
It is not unlawful for non-exempt employees to perform these activities. What IS unlawful is the employer’s failure to compensate employees for this work time in accordance with federal and state wage and hour laws.
Before fully embracing these emerging technologies, employers are cautioned to weigh the risk of potential off-the clock violations. These electronic devices track the times they are used and the various activities performed and can easily be used as evidence of work performed in a wage claim. Resolution of an FLSA overtime claim can include civil penalties and fines, criminal prosecution, countless hearings, attorneys’ fees, back pay, and liquidated damages.
If employers are going to permit or require non-exempt employees to work remotely, they should be vigilant in ensuring full compliance with the FLSA’s overtime provisions. At a minimum, employers should take the following actions:
- Implement an “off-the-clock” policy which clearly outlines time-recording procedures for all time worked.
- Provide portable electronic devices sparingly to non-exempt employees and have them sign an acknowledgement of time-reporting procedures.
- Conduct regular audits of pay and work records.
- Ensure employees are properly classified under the FLSA.
- Train supervisors and managers on the proper administration of wage and hour laws.
- Instruct supervisors to refrain from ordering hourly employees to take and return business-related calls, emails and texts while off the clock.
By implementing the recommendations described above, employers will be in a better position to avoid violating federal and state wage and hour laws.
Technology is here to stay and has many benefits. By implementing some safeguards we can reap these benefits while respecting employee rights and complying with federal and state wage and hour laws.
1 29 U.S.C. §§206(a)(1) and 207(a)(1).
2 29 C.F.R. §785.11.
3 29 C.F.R. §785.11.