Are you paying your employees properly? I’m not talking about how much, though you must pay at least minimum wage, I’m referring to how you pay your non-exempt employees. Both the state and federal government have very specific rules to follow and the penalties are severe if you aren’t in compliance. Here are some of the things you should be doing:
- Record all hours worked for your hourly non-exempts. Include start and stop times, including meal breaks, if unpaid. You can use time cards, time sheets, badges, or online systems. Just make sure you have a record for each employee.
- Have supervisors approve all hours worked each week. The supervisor should initial changes to “the card”.
- Pay overtime for all hours worked over 40 hours in the pay period at a rate of one and one-half times the hourly rate.
- No comp time for non-exempt employees (there are some exceptions to this rule).
- Make sure that employees take their unpaid breaks. If employees work through breaks, pay them for it.
- If employees must or choose to work through their breaks, have them sign a waiver.
- Issue paychecks according to your state mandates.
- Make sure you properly classify your employees as either exempt or non-exempt. Most understand these terms to mean salary or hourly, but it is not that simple. There are very specific rules and test to determine how to classify a job. Call me for help or contact the U.S. Department of Labor.
- Each state has specific rules covering payment of vacation pay and upon cessation of employment. Check with your state department of labor.
10. There are also rules on work at home, travel time, on call time, direct deposit, and others.
11. Put in place wage payment policiess and follow them. Educate your managers and employees on the rules.
Wage and hour laws are complex. Understand the rules and follow them exactly.
It is not uncommon for employers to face six figure penalties, back wage payments, and legal fees for errors and wage payments.
Review your policies, procedures and practices to ensure you’re in full compliance. Correct any errors found. Call me if you need help.