HR Advice for Non-Exempt Employees
I am a manager in a law firm, and I have several non-exempt employees as direct reports. They don’t punch a time-clock, and they only have to complete a time-sheet if they work more than 40 hours per week. I have noticed that I have a couple of employees who regularly work overtime, such as working through lunch, staying late, or coming in early – but they don’t submit time-sheets. Whenever I ask them about it, they say they don’t “need” to stay late, but that it makes them feel better to finish up emails or get ahead on projects, so they don’t mind that they aren’t receiving any overtime pay.
Because I value their work and their work ethic, I usually submit a few hours of overtime each month on their behalf. Since we don’t have time-clocks in this professional services environment, I’m assuming its fine for me to follow this process since I’m focused on treating my employees fairly. Even though we’re a law firm, the attorneys don’t want to be bothered with “in house” questions. Do you think there’s anything I need to be concerned about?
Dear Just Checking:
I appreciate your efforts to treat all of your employees, whether they are non-exempt employees or not, well! It’s always important to reward a good work ethic. But it’s also important to make sure you’re following legally-compliant processes, and in this case, it’s time for you to change your process and the way you manage your employees’ hours.
Regardless of whether your employees punch a timeclock, and regardless of what industry they are in, employees who are classified as “non-exempt employees” under the Fair Labor Standards Act (“FLSA”; see https://www.dol.gov/whd/regs/compliance/hrg.htm) must be paid time and one half for each hour worked beyond 40 in a work week.
Additionally, several states have their own overtime regulations that employers must be aware of. It is the employer’s duty to ensure that their employees understand their responsibility to record all hours worked – including time spent working remotely or checking emails from a mobile or other device. Employers can be subject to penalties and back wages for any overtime not paid correctly, and this can be very expensive!
Keep in mind that while your employees are currently voluntarily not reporting their overtime hours worked (and even with voluntary overtime, the employer still must pay for those extra hours), they may feel pressure from others in the office not to report those hours. If they eventually become resentful of not receiving overtime pay, they may choose to file a wage and hour claim.
Speaking of voluntary overtime, that leads to a question about whether or not employers have to pay overtime even after they’ve specifically told employees not to work any extra hours. And the answer is yes – employees still must be aid for those extra hours. However, you should have a policy documenting that unapproved overtime may result in disciplinary action, so it’s time to start that process with employees who violate the policy.
In this case, where you are aware your employees are working overtime, you must make sure they understand the importance of accurately recording all time worked on their time-sheets. It’s also a good idea for you to speak with your Human Resources team or Mercer PeoplePro consultant to understand how best to document time recording policies for your employees.
Thanks for your great question!
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*Please note that neither Gabby nor the Mercer PeoplePro Pros are able to provide legal advice on any matter. For legal questions please refer to your in-house council for guidance.