Don't fall victim to overtime misconceptions - Salaried workers are not always exempt!
Most employers try to avoid overtime pay when possible. It's expensive, requires additional calculation and can foster bad employee habits. If staff members discover they can give themselves a raise by picking up extra shifts and staying late, they might take advantage of opportunities to earn higher wages for additional time and attendance.
That being said, it's crucial that employers do not enact policies to avoid paying overtime at the risk of violating the Fair Labor Standards Act (FLSA). The Department of Labor (DOL) has very strict guidelines regarding which employees have rights to overtime pay. If businesses don't comply with these rules, they could face labor rights violations and be forced to pay back wages and damages.
Here are some common misconceptions about overtime exemption that can lead employers astray:
1. Salaried workers are not owed overtime
While there is a salary requirement for overtime exemptions, paying employees an annual wage does not always mean they shouldn't also get time-and-a-half for putting in extra hours, reports Business and Legal Resources (BLR). They must also meet criteria regarding primary job duties and exert a certain degree of discretion at work.
2. Making agreements not to pay overtime
Employers can make collective bargaining agreements with their staff members regarding benefits and payment schedules, but they cannot refuse to pay workers overtime because of an agreement. The DOL still holds them liable for compensating extra hours worked.
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