If you have employees, you run the risk of being struck with a claim for unpaid overtime at some point. Although not all businesses get hit with such claims, a fair amount do. As we’ve discussed elsewhere on our blog, overtime pay is something guaranteed by the Fair Labor Standards Act (FLSA), one of the more critical pieces of employment law which affects businesses. In this post, we will go over the basic overtime provisions of the FLSA, and then discuss how employers can deal with a claim for unpaid overtime if a current or former employee should make one.
Overtime Pay via the FLSA
Whenever an employee works more than 40 hours in a given 7 day period, that employee is entitled to “time and a half” pay, which means his or her normal pay rate plus an additional 50%. So, if an employee’s normal pay rate is $20 per hour, then his or her overtime pay rate would be $30 per hour. Importantly, per the FLSA, overtime pay is not something which can be suspended, declined or negotiated. When a non-exempt employee – i.e. an employee who qualifies for the protections of the FLSA – logs overtime, that employee is entitled to compensation at the overtime pay rate. An employer cannot withdraw or overlook this responsibility.
Bases on Which Claims Can Be Defeated
At some point, you may have a former employee who makes a claim for unpaid overtime; this claim could also come from a current employee as well. As mentioned, it’s actually not uncommon for employers to be struck with such claims at some point or another. The key thing you need to keep in mind is that you shouldn’t be intimidated by such claims. Oftentimes a former employee will come back and make such claims for frivolous reasons, such as dissatisfaction with the terms of his or her exit from the company. What you need to do is begin the process of identifying one of the bases on which you may overcome the claim.
There are basically three bases which you can cite to defeat a claim for unpaid overtime. The first is that the employee simply didn’t work the hours that he or she claims. As mentioned, overtime is based on hours worked during a given work week, and so showing that an employee didn’t work more than 40 hours is tantamount to dismantling the claim. The second basis is that the employee was actually compensated for whatever overtime pay is being cited. Finally, the last is that the employee is actually an “exempt” employee, which means that no overtime pay is required under the FLSA.
Calmly Collect Evidence for Your Case
No matter which basis you use to defeat the claim, the thing you need to remember in every situation is to remain calm and don’t panic. Take time and carefully gather the evidence you need to support your position. If you’re going to invoke the first basis, be sure to keep detailed time records so you can demonstrate clearly that no overtime hours were actually worked. Or, if you cite the second basis, be sure to provide bank records which show that you compensated your employee fully for all hours worked, including overtime.
If you argue that your employee was actually exempt, then you will also need to provide evidence to substantiate this position as well. Usually, this isn’t too difficult to prove on your part; in the majority of cases, employees are the ones who make this mistake because they aren’t familiar with the distinction between exempt and non-exempt under the FLSA.
Contact Trembly Law for More Info
Although claims for unpaid overtime can sometimes be intimidating, there is no reason to be alarmed. If you need further guidance, reach out to the Trembly Law Firm today for more information by calling (305) 431-5678.
Trembly Law Firm
9700 South Dixie Hwy Penthouse 1100
Miami, Florida 33156