D. Overtime

If you are an hourly ("nonexempt") worker, the FLSA requires that you be paid at one and a half times your regular hourly rate if you work more than 40 hours in a five-day workweek. Several classifications of salaried employees are exempt from the minimum wage and overtime requirements of the FLSA: outside salespersons, independent contractors, employees of certain retail establishments, amusement and recreation park employees, and others who meet various statutory tests, such as persons who hold bona fide executive, administrative, or professional jobs. The rules governing whether you are considered an exempt executive, administrative, or professional worker are complex. Speak to a lawyer for more details where applicable.

In addition to claims of employee entitlement and problems regarding the computation of overtime, other disputes that sometimes arise include whether an employee can waive the right to overtime pay, what rights employers have in requiring people to work overtime, whether employers can equalize overtime on a day-to-day basis, and problems with unauthorized overtime.

In one recent case, an employer docked a worker $3,300 for taking time off. She sued and won. The court ruled that when this occurred, the worker became reclassified as an hourly worker and once any professional worker is classified as hourly, the company is liable for all overtime incurred during the past two years for that employee and similarly situated employees. The company was ordered to pay $750,000 in damages to the woman and 23 others.

Tip:If you are a salaried exempt professional, question all company policies that impose partial or full-day unpaid leaves. If you are an hourly employee, recognize that most compensatory plans (also called comp plans) allowing workers time off without pay in the work period following the week they worked excessive hours, or allowing them to work more than 40 hours one week to make up for working less than 40 hours in a previous week, may be illegal. Each workweek must be considered separately in determining overtime hours, regardless of the length of the pay period, except for certain occupations (e.g., police officers or firefighters); employers giving time off must compute the value of such benefits at one and a half times the regular rate of pay.

Employers who fail to pay required overtime are liable for any unpaid overtime compensation and an equal amount as liquidated damages, plus attorney fees and costs. For willful violations, damages sometimes include earned overtime up to three years back, plus punitive damages.

Counsel Comments:Since the purpose of the FLSA is to ensure that employees are paid their full wages, employers may not make any deals to settle wage-hour claims for less than the full amount (even when a release is signed by the employee to defeat the rights of the worker). Although usually courts are pleased when prospective litigants compromise their differences, no such compromise is generally accepted under FLSA.

If you are an hourly worker, you may be entitled to overtime pay under the following conditions:

• If you arrive to work earlier than your starting time and do light work at the request of the employer
• If you typically work through lunch breaks at the employer's request
• If you take work home with the knowledge and permission of the employer
• When at home you are required to be "on call" and ready to report to work within an hour
• If you work several hours of overtime on a Friday and the employer states that you can leave work several hours earlier the following week
• If the job requires you to stay overnight for out-of-state assignments or travel extensively while on company business (but not for normal commuting travel to and from your home)

In these and other situations, speak to a knowledgeable labor attorney about your rights and options. The wage and hour law is complex, and matters are often subject to detailed investigations. However, employers are generally required to give nonexempt workers as much advance notice as possible when they are expected to stay late. They should also rotate overtime, maintain a roster recording each worker's overtime, and establish rules as to how the roster system will work. Federal law requires employers who offer overtime to post signs outlining the federal minimum wage and overtime regulations conspicuously in places where workers enter and exit.

Additional rules concerning overtime are:

1. Generally, employers cannot force workers to waive their entitlement to overtime.
2. If the company has no knowledge that an employee is working overtime and has established a rule or policy prohibiting overtime work that is conspicuously posted, an employee may not be entitled to overtime pay after making a claim.
3. The FLSA does not protect employees who deliberately over-report their overtime hours. The employer may terminate an employee who falsifies overtime hours and may not be subject to claims of retaliation or unfair treatment.
4. Generally, employees cannot refuse to work overtime unless they have a valid reason (e.g., taking care of a sick child). If the refusal to work overtime is not for good cause and the employer suffers undue hardship, this may be grounds for a valid termination and denial of unemployment benefits, even for union workers protected by collective bargaining agreements. However, if you believe you were fired unjustifiably, speak to a lawyer immediately.
5. If you are requested to participate in a company-sponsored program after hours, such as a mercy session (e.g., a company-sponsored blood drive), and are an hourly worker, you may be entitled to overtime compensation.

Counsel Comments:Speak to a lawyer if you are required to do extensive traveling on company business and are not paid for your time. The author recently represented a female television reporter-producer who was encouraged to spend hundreds of hours each month traveling around the world to obtain provocative news stories. The author obtained a large five-figure settlement representing overtime pay even though the reporter was paid a salary and was considered exempt by her employer.

Tip:Confer with counsel if you are unsure whether or not you are considered an exempt worker. Be sure that the company fairly rotates overtime between the sexes. Discrimination often ensues when supervisors fail to equalize overtime (e.g., they offer substantially more overtime to males than females or minority workers).

Question all attempts by your employer to dock you for time taken to attend jury duty, to vote, and to handle medical emergencies. Most states do not allow employers to do this. If you are in doubt about a company's action in this area, call your local U.S. Labor Department Wage and Hour Division office for further details.