The law divides nearly all workforces into classes of “Exempt” and “Nonexempt” employees. If your job position is classified as “Nonexempt” and you worked more than forty hours per week, you are entitled to overtime pay, that’s the law. This also applies to people who work for tips and commissions, as well as salaried employees. Employers who ask employees to work through lunch, work after hours, work off the clock, volunteer weekend or night time to perform normal work duties, or have employees work more than forty hours in a week, owe their employees over time pay.
Under the Fair Labor Standards Act (“the FLSA”) non-exempt employees are entitled to time-and-a-half compensation, and the FLSA makes it illegal for an employer to withhold overtime pay from a non-exempt employee who works over 40 hours in a workweek. This means that any overtime worked in a particular workweek must be paid on the pay day covering the same pay period in which the overtime hours were worked.
Even so, employers often try to avoid paying overtime by misclassifying employees as “exempt,” having employees work “off the clock,” or refusing to pay employees for certain hours worked (such as putting on uniforms or equipment or putting these same things away).
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Employers also sometimes do not pay any wages at all, claiming that they do not have the money or the tools, books, uniforms and the like were not returned. Very often this leads to a minimum wage violation under the FLSA, as this conduct is illegal in most circumstances. In other cases, employers do not pay full wages to employees or pay below minimum wage when the wages for the week are averaged. This is almost always an illegal wage violation under the FLSA.
It does not matter if you agreed to work for less than minimum wage or for free; under the FLSA an employee cannot waive their rights. So, when an employer strikes a deal with an employee allowing the employee to work off the clock for tips or for some other purposes, the employer still has to pay wages. The FLSA doesn’t let employers take advantage of employees in this manner because it would be so easy for an employer to just claim “he just wanted to work a little more for free.” The rule is that if the employer allows you to work, you have to get paid for all of the time you worked.
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Pay for overtime is most every employee’s right, with the exception of exempt employees, as long as they have not been misclassified as exempt. Overtime labor laws are in place to ensure that an employer adheres to overtime rules, but employers may look for ways to avoid employee overtime pay. Countless employees have filed lawsuits against their bosses to recoup overtime pay, and increasingly, many of them are winning.
A number of America’s biggest employers, including Wal-Mart, Starbucks, IBM, Morgan Stanley and Merrill Lynch, have all been sued for overtime violations, and their employees were awarded back pay and sometimes damages.
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Not only are blue collar workers filing lawsuits: traditional white collar workers, from IT workers to stockbrokers to pharmaceutical reps (Abbott Laboratories, AstraZeneca, and Eli Lilly, to name a few) have filed overtime lawsuits, and they have won. All the above companies either face large scale class-action overtime lawsuits or have recently paid out eight- or nine-figure settlements in overtime cases. Some companies have repeatedly violated overtime labor laws.
According to The Department of Labor, in fiscal year 2008, more than 197,000 employees received a total of $140.2 million in minimum wage and overtime back wages as a result of Fair Labor Standards Act (FLSA) violations. The most frequently cited violation was the payment of straight-time pay for overtime-hours worked.
Overtime–and overtime lawsuits–is on the rise for a number of reasons. Historically, both employment and overtime have increased as the US economy emerged from recessions. As well, as the US has moved toward a service economy, blue collar and white collar workers are not so clearly defined, causing many workers to be misclassified as exempt. Employers are facing rising healthcare and other benefit costs and to counter their expenses, demanding more hours from employees is more cost -effective than hiring new workers. And some companies avoid paying overtime altogether.
To Be Exempt as an Executive Employee, a Person Must:
1. customarily and regularly direct the work of two or more other full-time employees;
2. have management as his/her “primary duty;”
3. have the authority to hire and fire, or effectively to recommend such action or other changes in status;
4. customarily and regularly exercise discretionary powers;
5. spend no more than 20% of his/her hours in the workweek in activities not directly and closely related to the above duties, or 40% in a retail or service establishment.
6. be paid “on a salary basis.”
To Be Exempt as an Administrative Employee, a Person Must:
1. have as his/her “primary duty;”
a. office or non-manual work directly related to management policies or general business operations; or
b. performing work in educational administration, which work is directly related to academic instruction or training
2. customarily and regularly exercise discretion and independent judgment;
3. regularly and directly assist a bona fide executive or administrative employees; or
i. perform under only general supervision work that is specialized or technical and that requires special training, experience, or knowledge; or
ii. perform special assignments or tasks under only general supervision;
4. spend no more than 20% of his/her hours in the workweek in activities not directly and closely related to the above duties, or 40% in a retail or service establishment; and
5. be paid “on a salary basis.”
To Be Exempt as a Professional Employee, a Person Must:
1. have as his/her primary duty work which requires:
a. advanced knowledge customarily requiring extensive education; or
b. originality and creativity in a recognized artistic field; or
c. teaching or otherwise imparting knowledge as a teacher in a school or in an academic or educational institution; or
d. theoretical and practical application of highly specialized knowledge in computer systems analysis, programming, and software engineering in a computer/software occupation;
2. consistently exercise discretion and judgment;
3. perform work which is predominantly intellectual and varied, and which cannot be standardized in relation to a given period of time.
4. spend no more than 20% of his/her hours in the week in activities not essential and necessarily incidental to the above duties; and
5. be paid on “a salary basis.”
If you worked for any employer for more than 40 hours per week and did not receive overtime pay, contact a member of our Mass Torts Department at (800)-285-4878, or by clicking the link to your right.