FLSA lawsuits: Where does your state rank?
June 11, 2009 by Bill MeltzerPosted in: Latest News & Views, Money
Over the last year, there’s been a dramatic rise in the number of wage-and-hour lawsuits.
The spike has affected employers in all states. Why? For one, the economy has employees hypersensitive about their pay. If they feel they’re being cheated in any way, they’ll sue.
For another, highly publicized class-action cases involving Wal-Mart and other well-known employers have spurred copycat lawsuits.
A recent study by Seyfarth Shaw tracked wage-and-hour lawsuit activity in every state. The eight most active states are:
- California
- Florida
- Illinois
- Massachusetts
- New York
- New Jersey
- Pennsylvania, and
- Texas
A growing number of law firms specialize in wage-and-hour lawsuits. Such cases are considered low-hanging fruit because it’s easy for employers to accidentally run afoul of FLSA.
June 12th, 2009 at 1:32 pm
Employer does not want to pay unemployment. Employer is claiming employee turned in inaccurate hours to payroll department for payment.
Employee’s supervisor is the one who would call in the hours worked for each week. There was never a time sheet provided or a time clock to clock in and out. The employee never signed a time sheet one was not ever generated by the employer. What are the chances if any for the employee to be able to draw unemployment?
June 12th, 2009 at 2:45 pm
As per the case Bertha refers to, if the employee is right about not having anything to do with submitting the hours, signing/agreeing to what was being submitted, employer is gonna have a hard time defending it. Most likely the employee will get the award. The decision to make an award comes from a DOL arbitrator/judge (depending on the jurisdiction it covers) regardless of the info provided NOT from the employer. Unfortunately, 9 times out of 10 they favor employees. For the most part, employers don’t want to spend the time/resources to appeal the decisions as it is not only time consuming but also an increased expense. For this reason, often times, regardless of reason for termination, unless it was serious enough – such as theft, forgery, etc, companies tend to let go.
June 18th, 2009 at 4:35 pm
Bertha, under those circumstances, unemployment is the least of the worries. If the employee says they worked and the employer cannot prove otherwise, the Div. of Labor Standards Enforcement (CA agency) will automatically order payment, plus there will be interest and waiting penalties.
June 19th, 2009 at 10:11 am
I have a question for everyone…I’ve spent many hours online looking for an applicable law and have yet to find it.
We are set up on a Kronos timeclock and if an employee clocks in late, even if just one minute, their time is automatically rounded up to the nearest quarter hour. So if I clock in at 8:01, my time is rounded to 8:15 so technically I’m not being paid for 14 minutes. Is this legal?
I seem to remember something about a “7 minute rule”. Where the employee is not supposed to be docked if they clock in within 7 minutes of their start time. Does anyone have any input on this or any suggestions as to where I might find the answer?
Thanks!
June 19th, 2009 at 10:29 am
*Cynthia S. – the answer to your question is going to be dependent upon which state the worker is in?
June 19th, 2009 at 10:38 am
Oops, should have mentioned we’re in California.
June 19th, 2009 at 10:49 am
The clearest answer to your question will be found under CA state Labor Commissioner and rounding practices, as follows:
The state Labor Commissioner uses the U.S. Department of Labor practice of rounding employees’ hours to the nearest five minutes when calculating the number of hours worked.1 However, for enforcement purposes, the Labor Commissioner will accept the practice of computing working time by rounding to the nearest five minutes, or one-tenth or one-quarter of an hour, provided that it is used in such a manner that it will not result in failure to compensate the employees properly for all the time they actually worked over a period of time.
According to the Labor Commissioner, “When auditing payroll records, Division personnel will ascertain the facts regarding the time keeping requirements” (e.g., the true work patterns of the workers and whether the time records accurately reflect these patterns).2 In recording working time, you may disregard insubstantial or insignificant periods of time beyond the scheduled working hours, which cannot be precisely recorded for payroll purposes as a practical administrative matter.3
1. DLSE Enforcement Policies and Interpretations Manual sec. 47.1 and 47.2
2. DLSE Enforcement Policies and Interpretations Manual sec. 47.2.2.2; 29 CFR sec. 785.48(b)
3. DLSE Enforcement Policies and Interpretations Manual sec. 47.2.1 and 47.2.1.1
June 19th, 2009 at 12:54 pm
We use a rounding system on our time clock that refers to the 7 minute rule. The clock rounds to the next 15 minutes if punched after 7 minutes. So for example, employee punches in at 8:07, their time is recorded as 8:00. If they punch at 8:08 the time is recorded as 8:15. This should also be done on the back end when punching out. So if they punch out at 5:08, the time should be recorded at 5:15.
Many companies do this and if you Google 7 minute rule flsa, you should find plenty of opinions.
June 19th, 2009 at 1:03 pm
Thank you HR and Kelley M! I really appreciate your help.
June 25th, 2009 at 1:46 pm
That’s what is confusing to me. We were having employees clocking in 8 minutes early and 8 minutes late clocking out and because of the 15 minute thing the clock does they were being paid a total of an extra half hour for only working 2 extra minutes. I think we rectified that situation by making our attendance bonus policy stricter when it comes to time clock punches.
June 25th, 2009 at 1:50 pm
There is a 7 minute rule… but it does not sound like your employer is using it correctly.
The rule states that rounding is acceptable as long as it favors both the employer and the employee.
Just as Kelly M states.
Minutes 53-7 are rounded to the whole hour
Minutes 8-22 are rounded to the quarter hour
Minutes 23-37 are are rounded to the half hour
Minutes 38-52 are rounded to the three quarter hour
It really does make doing time cards so much easier than real time in 100th’s.
There is a downfall in using the 7 minute rule. I found that employees stand at the time clock and wait when they are clocking out for that extra minute.
June 25th, 2009 at 2:21 pm
Of course you need to have a policy in place regarding overtime and enforce it uniformly. Even if there is a policy, you must pay the non-exempt employee the overtime but you can discipline if they don’t follow the policy which can include termination if the policy states this.
June 25th, 2009 at 3:51 pm
We developed our own internal time clock (we have software developers on staff) that fixed the “hanging out at the time clock” issue to get credit for more time. When our programmer developed it, he set it up to round at the end of the week only. So rather than having a rounding opportunity in the morning, again when punching out for lunch and punching back in from lunch and again at the end of the day (4 times time over 5 days adds up to almost 2.5 hours over the course of the week), the computer time clock keeps accurate punches of all minutes worked between punches. At the end of the week, the total hours worked rounds to the 7 minute rule. We checked with Wage and Hour (federal and state) and were assured that this practice was fine. As long as the rounding favors both the employer and the employee, as Nita states, it’s fine. You might ask Kronos or other system whether the rounding rule can be changed in the system.
June 25th, 2009 at 4:00 pm
Nita, where can I find the applicable law that states what you have written? Are you in CA as well?
June 25th, 2009 at 5:40 pm
Its how our time clock is automatically set up through our vendor. If John’s shift is to begin at 7am and he clocks in at 6:52 am it pays him an extra 15 minutes. If John is to get off at 3PM and he clocks out at 3:08 it pays him another 15 minutes so it’s not that were not using it correctly. We have employees that were realizing this and coming in early to clock in 8 mins early and then standing around waiting until eight after the end of their shift to get an extra 15 min. Our time clock is automated and feeds into our payroll system which feeds into our HR system, so there is no way it could be used incorrectly. There are no manual inputs except for vacation time.