Employer Issues: Avoiding the Overtime Lawsuit

Like any relationship, working with employees can be difficult. And while it might often seem like the challenges are all on your end, they may say the same thing about you, as well as other members of the team. Many companies have a competitive, fast-paced environment, meaning that you form bonds with your crew as you are all in the trenches together each day—and sometimes it can seem like a battle just to survive taking care of customers, scheduling issues, deliveries, cleanup, and so much more. It might seem difficult, but experiencing that type of stress usually also means that your company is thriving and making money.

During busy times it can be easy to lose track of employee hours. While schedules are probably made ahead of time and everyone does their best to stick to the plan, you may need people to stay longer—perhaps a lot longer on super busy days. This may put them into the overtime category, and if it happens unexpectedly, and a lot, your payroll projects could change substantially. Employees may enjoy working overtime, but the motivation is almost always in getting time and a half (150 percent) as outlined by the federal Fair Labor Standards Act.

While failing to pay employees for overtime leaves you vulnerable to an angry lawsuit, often miscalculations in pay (or misclassifications for exemption) play a major role too. Chances are though, your team members will realize almost immediately that they have missed out on time and a half. If the problem is not rectified quickly, you may find yourself with legal issues—and the same goes for coming up with ‘creative’ ways to avoid paying overtime.

Some employees are exempt from overtime, and while you and your accounting department should be well educated on the subject, so should your workers—preventing them from expecting overtime that is not due. Salaried employees are usually exempt from overtime, as well as many higher-ups within a company. For more information, check out the United States Department of Labor website, as well as consulting with an experienced business attorney if you are concerned about pending litigation or are currently involved in a lawsuit regarding overtime.

If you have concerns about business or employee issues, consult with Attorney Shane Coons. Our law office represents clients involved in a wide range of businesses and legal issues, and we would be glad to review your case and help you explore your options. Call now at 949-333-0900 or email us at Shane.Coons@seclawoffices.com.

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Employer Issues: Avoiding the Overtime Lawsuit

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