Small businesses can avoid legal claims with appropriate job titles
When small businesses hire employees, they should take special caution when assigning job titles. Accurate job descriptions not only help in the recruiting process, they can also help owners be sure they are paying employees correctly.
The Fair Labor Standards Act (FLSA) establishes that employers must pay employees minimum wage and overtime pay for any hours they work beyond 40 in any given workweek. However, certain positions are exempt from FLSA standards. Those who are considered administrative, executive, professional, outside sales or highly compensated employees are exempt from benefits like overtime pay.
Small businesses should include this information when creating job titles, descriptions and payroll policies. Misclassifying an employee under the wrong job title can eliminate him or her from pay benefits and result in FLSA violations and expensive settlement if lawsuits are filed.
Employers can avoid classification errors by making sure the written job description and title match the employee's actual responsibilities. If there is a disconnect, or the employee is performing tasks that don't fit within the position's assigned duties, the description can be updated to avoid potential litigation.
The Fair Labor Standards Act (FLSA) establishes that employers must pay employees minimum wage and overtime pay for any hours they work beyond 40 in any given workweek. However, certain positions are exempt from FLSA standards. Those who are considered administrative, executive, professional, outside sales or highly compensated employees are exempt from benefits like overtime pay.
Small businesses should include this information when creating job titles, descriptions and payroll policies. Misclassifying an employee under the wrong job title can eliminate him or her from pay benefits and result in FLSA violations and expensive settlement if lawsuits are filed.
Employers can avoid classification errors by making sure the written job description and title match the employee's actual responsibilities. If there is a disconnect, or the employee is performing tasks that don't fit within the position's assigned duties, the description can be updated to avoid potential litigation.
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