Time For A Wage and Hour Audit

Mar 10 2014

In the past few years, we have seen a radical increase in the number of Fair Labor Standards Act and wage and hour class action lawsuits. Attorneys for employees have focused their efforts on class-wide claims asserting that an entire work site population is not being properly compensated for all hours worked or, in other words, are working for "free". These attorneys have focused their efforts on cases involving:

  • Unpaid meal breaks;
  • Being required to remain on-site during unpaid breaks;
  • Automatic break deduction;
  • Time clock rounding;
  • No compensation for "donning and doffing", or changing into uniforms and protective gear; and
  • Misclassification of hourly workers as "exempt".

With this increase in wage and hour litigation, employers of all types should examine their employment practices and conduct a wage and hour compliance audit. Special attention should not only be given to policies, but implementation of these policies and "traditional" practices. Employers should examine:

  • Preparation time;
  • Clean-up time;
  • Time record retention;
  • Automatic lunch deductions;
  • Any requirement to stay on campus;
  • Cellphone or pager use;
  • Responding to calls, emails, texts, or pagers during off-duty or unpaid time;
  • Interrupted unpaid breaks; and
  • Recording of actual beginning and end times for breaks.

Many employers have policies that allow for some, if not all, of the above practices. However, employers should look beyond the policy. The key to compliance is not the existence of the practice but how the practice is carried out. Employers should review the following:

  • How do I maintain my time records?
  • Are breaks paid or unpaid?
  • Are there any policies or practices that require my employees to remain on-site "at all times" without providing an exception for unpaid breaks?
  • What distance do my employees have to travel between the time clock and their work station?
  • Do my employees perform work during unpaid breaks? If so, is this work "de minimus"?
  • How do I handle reports of de minimus work during an unpaid break?
  • How do I track adjustments to automatic break deductions?
  • Do I provide cellphones, tablets, or pagers to my employees? Is there an expectation to monitor these devices during unpaid time?
  • Do policies and procedures relating to the use of work cellphones, tablets, or pagers address off-duty and unpaid break time use?
  • What clothes or protective gear are required to perform job duties?
  • How do I monitor and pay (or not pay) for time spent changing into clothes or protective gear?
  • Do my employees spend time going through a security check before entering or leaving the facility?
  • Are time clock punches rounded or do I use exact time of punch in/out to determine pay?
  • Does the payroll system automatically round times or are time clock punches rounded manually?
  • On what basis does someone manually round time clock punches? Is this spelled out in a written policy?
  • Are my job descriptions accurate as to duties actually performed?
  • When was the last time I reviewed job descriptions and actual duties to determine the accuracy of exempt and non-exempt designations?

The answers to any of the above questions will not definitively determine whether an employer is in compliance with state and federal wage and hour law. Instead, employers must examine how all of their policies and practices work together. We have helped employers meet the day-to-day challenges of wage and hour compliance, in addition to defending against numerous wage and hour claims.

von Briesen & Roper Legal Update is a periodic publication of von Briesen & Roper, s.c. It is intended for general information purposes for the community and highlights recent changes and developments in the legal area. This publication does not constitute legal advice, and the reader should consult legal counsel to determine how this information applies to any specific situation.