On November 27, 2019, the U.S. Department of Labor (“DOL”) issued a reminder to employers to be mindful of wage and hour requirements this holiday season. As the holiday season ramps up, so does the number of temporary and part-time workers hired to provide much needed help during this seasonal increase in business.
According to the DOL, common employer violations during the holiday season, include: (1) failing to pay salespeople and cashiers for time spent prepping or closing out registers; (2) requiring stock room and warehouse personnel to work through breaks without compensation; and (3) not providing overtime pay to non-exempt employees working more than 40 hours in a workweek.
In general, the Fair Labor Standards Act (“FLSA”) is the federal law that requires employers to pay employees at least minimum wage and to pay them one and one-half times their regular rate of pay for hours worked in excess of 40 in a workweek. Of course, it is important to know the number of hours worked and ensure there is no off-the-clock time worked by covered employees. The workweek ordinarily includes all time during which an employee is necessarily required to be on the employer’s premises, on duty or at a prescribed work place.
Short rest periods (usually 20 minutes or less) are customarily paid for as working time and those short periods must be counted as hours worked. Bona fide meal periods (typically 30 minutes or longer) generally need not be compensated as work time. However, the employee must be completely relieved from duty during the meal period. If the employee is not relieved completely, then the time should be counted as hours worked.
Employers run into trouble when they fail to count certain hours worked as compensable time, such as with the cashier, stock room, and warehouse examples mentioned in the DOL’s holiday reminder to employers. The trouble deepens when the uncounted hours worked result in unpaid overtime. Employers who run afoul of the FLSA can find themselves on the hook for unpaid wages, liquidated damages (a.k.a. “double damages”), attorney’s fees and costs. Additional liability may arise under state law, such as the South Carolina Payment of Wages Act, which provides for treble damages.
With the busy season and the hiring influx that many employers experience with the holidays, it is doubly important to ensure that employees are properly compensated and that no off-the-clock work time is happening. This holiday season, Santa and the DOL will be making a list and checking it twice to see which employers have been naughty and which have been nice.