Workday Trends Blur Overtime Rules
What is overtime and who is entitled to get paid for
It's a heated question that has set off alarms for
employers and spawned hundreds of lawsuits in courts nationwide. And it will
only get more attention as employers squeeze productivity from workers and
lawyers cash in on the most lucrative area of employment litigation.
Employees seeking work/life balance clearly want to
be compensated for hours on the clock, especially those who are living without
the high salaries that give executives an exemption from overtime. Those earning
overtime get 1.5 times pay when working more than 40 hours a week.
But in an evolving, always-on workplace where
employees routinely put in extra hours and shoot off e-mails late at night from
mobile devices, where the workday begins and ends has become an issue for
employers of all sizes.
"The whole definition of 'working' is being
questioned," says Gary A. Costales, a Miami attorney who both sues employers and
In South Florida, two concrete-cutting truck drivers
are suing their employer for overtime, claiming they should be paid for their
commute. The drivers say that driving to the work sites in their trucks with all
the equipment is part of their jobs and should be considered as on-the-clock
time. They also assert they didn't get paid for working through lunch or
attending mandatory safety meetings.
As the work week becomes a 24/7 affair for many
industries, attorneys are advising companies to revise their employment
agreements. Some employers could require employees to get permission before
using their BlackBerrys or checking e-mail after work hours.
"Technology is a huge part of cases now because it
creates a work record," said Michael Casey, an employment lawyer with Epstein
Becker & Green in Miami.
Just last month, ABC News faced overtime requests
from its employees who use their BlackBerrys for work purposes after hours.
Management quickly drew up agreements with the Writers Union for employees to
waive their right to overtime pay. Those who did not sign the waiver had their
BlackBerrys taken away.
Then there's the issue of working off the clock. As
the economy heads south, employees routinely find themselves in the same shoes
as Dara Fresco, a longtime employee of Canadian Imperial Bank.
She contends the company piles so much work on its
employees, they have no choice but to stay late to finish it all. And, she says
she was told she couldn't file for overtime. Fresco has sued for $50,000 in
overtime. She is hoping the institution's 10,000 former and current
non-management employees come on board and is asking for $500 million in damages
on their behalf. The bank denies the contentions.
Attorney Robert Turk says employers are looking more
carefully at staff hours and work habits, even trying to stop hourly people from
working through lunch. "It may be innocent but if a couple hundred employees are
working through lunch that adds up to lot of money."
Of course, not everyone is owed overtime. About 115
million employees - 86 percent of the workforce are eligible to receive overtime
under federal rules, according to the U.S. Labor Department. The rules apply to
salaried and hourly workers with some exemptions such as those for various
professionals, executives and highly compensated individuals.
Meanwhile judges are complaining that overtime suits
are clogging the federal courts. Some of the momentum comes from the attorneys
who find wage-and-hour violations are far more lucrative than harassment or
discrimination lawsuits. Lawyers estimate that over the last few years firms
have paid out more than $1 billion annually to resolve these claims.
This infuriates small-business owners like Geniveve
Henriques, who operates a law office and real estate company in Miami. Henriques
says after two employees resigned, they sued her for overtime, claiming she
misclassified them as salaried professionals. They asked to be paid for working
through lunch and breaks and taking cell phone calls after hours.
Henriques fought back and won. "It still cost me
emotionally and financially," she said. Going forward, Henriques said any
employees she hires will be hourly and will clock in and out.
Tom Roses, president of The Continental Group, a
property management and services company which employs 6,500 mostly hourly
workers throughout Florida, has made changes, too.
During orientation, the company now clarifies when
work starts and ends, what will be accomplished in a work week, and whether the
commute to the job site counts as work time. Roses says he eliminated comp time
and went to 37-hour work weeks to allow extra hours without the need for
"We don't want a complaint against us because we
haven't been clear," Roses says. "We have made sure that there is no wiggle