Working in the construction industry, I get asked quite often about wage violations. I've seen companies shut down because of the expensive lawsuits, and others lose a chunk of their profit.

I'm sure we are all aware that wage violations are a big deal. As part of this post, you'll see that there are quite a few things to watch out for. Some of these are scary, and even I have to admit that I have violated some of these in my businesses in the past.

If you are concerned that you might be violating the FLSA, it is critical that come up with a solution that protects you and the employee. Remember, labor laws exist for the employee.

Common Wage Violations

The Federal Fair Labor Standards Act (“FLSA”) protects workers from unfair wage practices by employers. Under the FLSA and similar state laws, many workers have the right to receive the minimum wage, payment for all time worked, and overtime pay calculated at 1.5 times their regular rate of pay for all hours worked over 40 in a workweek. Remember that these violations are only examples of the many different wage violations that companies commit.

Failing to credit and pay employees for all time spent working
Example: Requiring workers to perform duties before or after punching in.

Failing to pay for “unauthorized” overtime
Example: If an employee’s manager refuses to authorize payment of overtime but knows the employee is having to work overtime anyway, that employee is likely entitled to overtime pay.

Misclassifying salaried employees as exempt managers, supervisors, administrators, or professionals
Example: Just because you are a salaried employee or have a specific title that sounds like you are exempt does not mean you are not entitled to protection under the FLSA; such employees may be entitled to overtime depending on the job duties performed.

Making improper deductions from paychecks causing wages to fall below statutory requirements

Improperly classifying employees as independent contractors Example: Whether a worker is truly an independent contractor depends on the specific circumstances of the employment, not the title they are given.

Failing to include commissions, shift differential pay, and other monetary payments in the overtime calculation for hours worked over forty in the given workweek.

Applying rounding rules that regularly short employees of wages earned.

Paying employees under the table.

The good news is that it is possible to make sure you are compliant with all labor laws, without compromising your productivity and increase your profit.
To discuss solutions to these issues, feel free to contact me through LinkedIn, or through the information listed below.

Herbert Timpson
623.239.2560