Liable for previous overtime?

FJN

I am undertaking a company-wide job analysis and have discovered at least one class of employees who need to be non-exempt, rather than exempt. Should we attempt to go back and pay them for uncompensated overtime or are we simply bound to pay overtime from this point forward? Thanks for quick replies!

TheCol

Liable? Yes. Back three years, in my experience. If you have accurate records of overtime then you should calculate what's owed. I would try to "lump sum" the individual owings with a letter of regret for omissions, and a receipt from each employee. Normal payroll, FICA, all that. You might even solicit the support of your local Dept of Labor, Wage/Hour Administration Div. here at this point. What we are trying in this instance is to avoid the "liquidated damages" that DOL can impose for non-payment. No IRS problems this way, it's wages in this calendar year.

nancy rochman

I know from a previous DOL audit at our company that if you did not correctly classify an employee as nonexepmt but that you were not deemed to be merely avoiding your responsibility of overtime, you would be told to pay 2 years back overtime pay. If you do this, I doubt the DOL would fine your company with penalties, even if they did audit these years.