Time Equipment Company presents Wage and Hour Compliance

Agenda  About Me  Compliance Overview  Lunches and Breaks  Overtime Calculations  FMLA Review  Potential for Abuse  Parting Thoughts

John Brondello III

Disclaimer  I am NOT an attorney and anything I say or present should NOT be taken as legal advice. Please consult your labor law attorney for any legal advise. I am glad to refer you to one if need be.

Unemployment Rates

"I can hit a company with a hundred sexual harassment lawsuits, and it will not inflict anywhere near the damage that [a wage and hour suit] will." -J. Nelson Thomas, a Rochester (N.Y.) attorney

Litigation Tops the List 33% of all companies have faced a wage and hour claim 54% of all companies have increased their budget for wage and hour compliance despite the economy

Litigation Tops the List (cont.) Citing statistics from the DOL, ELT reported that more than 80% of employers are out of compliance with federal and state wage and hour laws. Unpaid overtime Off the clock work Donning and doffing Unpaid travel Tip pooling Attendance documentation FMLA can excuse all attendance infractions FMLA Tracking

Today’s Reality

Quick Shots – Did You Know? Rhode Island “Parent and Family Leave Act” (baby FMLA) permits 13 weeks (not 12) consecutive (no Intermittent) Minnesota is one of 19 states with specific state regulations regarding employee meals and breaks Nevada just added 8 hours daily overtime and School Leave Monthly pay periods are not allowed in some States Many States require “Show up Pay” The new health care law mandates lactation breaks Thin line between FMLA and ADA Alcoholism is covered under ADA, but not FMLA (They’ve tried…)

Meals and Breaks  30 continuous minutes  Documentation  Is it assumed, written, or punched  Where are they taken  Individual State Laws

Early to Work  What do you do when employees arrive early  How do you match up with schedules  How do you prevent unauthorized work  Protection from Wage and Hour

Calculating OT on Bonuses  Are regular bonuses part of your compensation?  What happens when an employee works OT?

OT Bonus Example  Employee $20 per hour with incentive bonuses  Employee works 45 hours with $450 bonus  Regular compensation  45 x $20 = $900  $ = $1,350  $1,350 / 45 = $30 (new base rate)  Overtime is ($30 / 2) x 5 = $75  Total compensation = $900 + $450 + $75 = $1,425

Blended Rate Overtime  Employees work different jobs throughout the week  Employee gets paid a different rate based on job  What rate do you use if the employee works OT Employers are required to average the rate based on hours worked in each rate and pay the overtime based on the new Blended Rate.

Blended Rate OT Example  Employee works 25 hours at $15 per hour  Employee works 30 hours at $20 per hour  Total Regular Compensation:  (25 x $15) + (30 x $20) = $975  Regular rate = $975 / 55 = $17.73  Overtime rate - $17.73 / 2 = 8.87  Overtime pay = $8.87 x 15 =  Total Pay = $ = $1,108.05

Weekly Compensation  Employees are paid a weekly salary of $1,000  Employee is non-exempt  Employee receives a performance bonus of $500  Employee works 10 hours per day  Total compensation = $1,000 + $500 = $1,500  Regular rate = $1,500 / 50 = $30  Overtime pay = ($30 / 2) x 10 = $150  Total pay = $1,500 + $150 = $1,650

Wage and Hour Lawsuit #1  Local company  100 employees  3 years and $1.6 million  Wages were only $400,000

Wage and Hour Lawsuit #2  Las Vegas company  Simple overtime complaint of $88  Employee asked for Class Action status  Company offered to settle for $900 + “reasonable attorney’s fees ($3,500) (Just for the 1 employee)  Offer was turned down and is now in Federal Court with Class Action status

Leave granted to qualifying employees for a medical need (for self or family member), bonding with a child, or caring for a service member FMLA Definition

FMLA Overview  50+ employees within 75 miles  12 weeks of standard schedule  1250 hours worked in previous 12 months of employment  30 days notice on foreseeable medical need  Covered condition or situation  Incapacitating illness  Care of ill child or parent  Care of military family member  Bonding with a child post- birth or adoption FMLA-Required for Employers Employee FMLA-Eligiblity

Increased regulation, investigation, and employee rights under FMLA Do you require a Doctor’s note? You may be in violation of the ADA! FMLA Update

FMLA Changes Previous FMLAToday’s FMLA 30 Day Notice0 Notice – 30 Days to provide Dr.’s note. Fed law is 3 days 12 Weeks unpaid time off480 hours taken when needed – 1 hour at time Unpaid timePotential for paid FMLA – HR Bill 3047 Incapacitating Illnesshead aches, back or neck pain, insomnia, diarrhea… Alcoholism isn’t covered but ‘hang overs’ are

Potential for Abuse  Multiple claims at one time  Secondary documentation not always needed  Employee termination becomes tricky 30 Day notice has been replaced with 0 notice and 30 days to provide paperwork  Paperwork = Doctors Note

FMLA Abuse?  13,000 Employees  Over 10% have pre- existing health conditions  1,200 claims per pay period  400 new claims per month  1 employee has 14 unique FMLA conditions  Doctors notes may be easier to obtain  Employees ‘work’ at a hospital

Most Important Consistent application of attendance policy If you are consistent, you have a better chance of defending yourself. Use Reason Codes approved by management to designate conditions Management training is critical to consistent application

Are you protected Do you have systems in place to pass an audit Are lunches and breaks documented Is overtime being calculated correctly Addressing of FMLA intermittent leave Parting Thoughts

Thank you John Brondello III Time Equipment Company