I first wrote this post in 2010, however it is still as applicable today as it was then. The links are disabled from that first post, but I have provided a link at the bottom for FLSA information.
First off let me get the disclaimer out of the way. I am NOT an attorney. I am NOT providing legal advice. I am making these statements from the perspective of an HR professional, consultant and HR instructor that has dealt with Wage & Hour issues for a long time. With that said here is my list of things that may help you avoid a wage & hour investigation or, if you have one, may help you come out better as a result.
Step 1: Be educated. If you have been in HR for any period of time you have run across FLSA issues. You may think you know them. Hopefully you do. However, my 12 years of teaching has shown is that many people know how their company does things and not what the law says. Many times the “company” way of doing things is NOT correct. Additionally, there are variations on wage & hour issues that vary by states and also municipalities. There is a lot of material out there that will provide you guidance; the only caveat is to make sure you are getting materials published as recently as possible. The FLSA was altered substantially in 2004, so stay away from pre-2004 materials. The USDOL website actually offers materials that will help educate you. You can see their PowerPoint by clicking Fair Labor Standards Act.
Step 2 : Educate your managers and supervisors. The interaction between manager and employee is where the “rubber meets the road” and most of your violations will occur here. Make sure they understand that no one works for “free.” Make sure they understand not only the rules but also company policy on how to deal with issues as unauthorized overtime, breaks, meal times, travel time and “donning and doffing” time. Wage and Hour Law (Basic Training for Supervisors) is a guide book you can get from Amazon that provides some good basic training.
Step 3: Realize that jobs classified at EXEMPT must truly meet the exemptions standards set forth by the FLSA. Job titles do not reign supreme. You can review these exemptions by viewing this PowerPoint on exemptions. If as a result of your review of the exemptions you find it necessary to interview managers and/or employees, the lawyers of Seyfarth Shaw recommend that you involve an attorney in order to preserve the attorney-client privilege. If you engage an outside consultant make sure their work is being directed by an attorney as well in order to safeguard the privilege.
Step 4: Create the appropriate policies. This includes a “Safe Harbor” policy to help protect you in case mistakes do get made. This policy needs to prohibit improper deductions, provides a mechanism for employees to complain TO YOU about them, and specifies you will correct the errors and promise to not make those mistakes again. Depending on the nature of your workforce you also need to specify other policies that deal with your employee population and the way they report time, get paid for that time and under what circumstances. These may include some of the things mentioned above, such as meal times, overtime, being fully relieved of work during meal times. But it may also include training time and travel time. You need to be specific to your workforce.
Step 5: Train your employees. We covered supervisor training, but rather than having them correct behavior all the time it is easier to explain to employees what correct behavior is and thus avoid wage and hour issues. So once you have the policies written make sure you spend some time educating.
The USDOL has targeted some specific industries, including healthcare, restaurants, janitorial services, day care, car washes, and the temporary help business. But just because you are not on this list does not make you safe. A complaint from an employee or ex-employee may also bring a visit. So hopefully this brief statement may help you avoid some problems. Will it stop all of them? No.. remember the FLSA is 700 pages long. But the more you can do to ward off complaints being filed, the more you can do to keep investigators from visiting, the more you can do to lessen the impact of what they may find if they do visit, the better off you will be.
For more information on the FLSA you can visit and view the E-Tools section of the Department of Labor’s website by clicking here.
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