Flex Overtime

flaroyale

Has anyone here ever heard of this. I was just told by one of our clients that a company they worked for previously in Texas use to do this. To get around paying overtime. I have never heard of it. THanks

Don D

[font size="1" color="#FF0000"]LAST EDITED ON 01-20-04 AT 04:09AM (CST)[/font][br][br]I'm not sure what they were talking about because you didn't explain it. I do know that within a defined 40 hour work week the employer can flex a non-exempts hours to avoid overtime kicking in. For example: On the first three days of the workweek the employee works eleven hours per day. That's 33, right. On the fourth day the employee flexes their hours and tells them to work 7 hours and not report to work on the fifth. Their hours were flexed to avoid having to pay overtime. Is this anywhere close to what you're talking about?

However, if your client is suggesting that an employer can flex up the second week of a two week pay cycle, by working the ee less than 40, to compensate for the employee having worked more than 40 the first week, that's not legal.

LarryC

They may have changed their workweek, which need not coincide with the calendar week. A workweek is seven consecutive 24-hour periods however you want to set it up. It can also start at any hour of the day. I'm sure businesses have reasons why they would do this.

Regardless, OT must be paid for any hours over 40 in a workweek.

It also could be that they are using the word "flex" as in "stretch" as in "stretching the rules". Texas, eh?

flaroyale

I think stretching the rules is exactly what she is talking about. I will try to explain what she was telling me. She stated that they had non-exempt salaried employees who when they worked over 40 hours they simply paid half time for the hours over 40 and reduced their regular hourly rate for that time so their salary still came out the same no matter how many hours they worked. I told her that was not legal, and that she was not to tell her employer they could do it. She became very upset with me and proceeded to tell me that I did not know what I was talking about because they did it in Texas and DOL approved of it. I don't pretent to know everything about HR, however I have been in this field for over 10 years and do have my certification so I know some. I sent her the web address to DOL which addresses Overtime and tried to explain to her she could not change an employees hourly salary bi-weekly to make it come out the same salary each pay period but she did not want to listen to me. I could be wrong, it wouldn't be the first time nor will it be the last I am sure I just can't imagine that this is correct. Thanks for all the imput.

Tammy

Don D

She became very upset with me and proceeded
>to tell me that I did not know what I was
>talking about because they did it in Texas and
>DOL approved of it.

I regularly see the bumper stickers that read "Don't Mess With Texas". I think it also means, "Or Women Who Hail From There".

flaroyale

Yea Don, I think your right. Even though she is not...x;-)

mwild31

You have said that this information was provided to you from a client - so, I don't know how deep you want to pursue it, but I did some quick research. Anyway, (and please fellow forumites, don't crucify me if I'm wrong) she may have a point. I love Texas, but their ee rules are a little strange. In their payday laws, they do talk quite a bit about piece work - if this company pays people through piece work & the method has been approved by the state commissioner, then it might be right. However, if that's not the case, Texas falls back on the FLSA for its rules on wages - to include how to calculate OT. Here's a link to Texas: [url]http://www.twc.state.tx.us/customers/bemp/bempsub5.html[/url]

blw

Being from Texas, I wouldn't do it that way - it is illegal! It sounds like they have twisted things a bit. It is often not realized that if a non-exempt employee is on salary, that covers the regular rate of pay for all hours worked in the week - you only owe the 1/2 overtime. So depending on the hours worked, the hourly rate of pay can go up and down and be constantly changing. However, it is based on salary divided by total hours worked, and you can't manipulate that to get the same pay every week. Not even in Texas!

flaroyale

blw,

You may have a point I am not sure how involved with payroll she was so she may have thought the employees were non exempt salaried when they were actually hourly. Which would mean they were paid time and 1/2 for over time.

Thanks for the web site mwild I will check it out also.

Thanks everyone for your time and comments.

Brad Forrister

This sounds like the "fluctuating workweek" that's allowed for in the DOL regulations. It's a bizarre little exception.

Here's how our Special Report on overtime explains it:

Fluctuating Workweek. For employees whose work hours fluctuate from week to week, the regulations allow employers to pay a base salary plus an overtime premium of just one-half the employees’ regular hourly rate for overtime hours worked. But in order to use the fluctuating workweek method of calculating overtime, the employer must meet certain requirements:

➣ The employee must be employed and paid on a salary basis. (i.e., salaried non-exempt)

➣ The employee’s hours must fluctuate from week to week.

➣ The employee’s salary must be the same regardless of the number of hours the employee works in a workweek. This means that the employee’s regular hourly rate will vary from week to week. The regular hourly rate for any given week is calculated by dividing the
number of hours worked that week into the amount of the salary.

➣ The amount of the employee’s salary must be high enough to ensure that the actual hourly rate at which the employee is paid never drops below the minimum wage rate.

➣ The employer must pay overtime for hours in excess of 40 per workweek at a rate of at least one-half the employee’s regular rate of pay for that week.

➣ The employer and employee must have a clear mutual understanding of the manner in which the salary and overtime hours will be paid.


Brad Forrister
Director of Publishing
M. Lee Smith Publishers

Hatchetman

Without trying to sond pretentious,I agree with Mr. Forrister.

However, in Flaroyale's description of what the manager said, it sounds as if what was happening in Texas was that AFTER the overtime was calculated at half pay, then the rate of pay was reduced, so that the entire salary, base salary and the half pay overtime was paid at a lower rate than it should have been in order to wind up with the original amount of the base salary as the total payment for the week. That would be "illegal" under the relevant FLSA provision (29CFR778.114).

FLSA does require that the base salary be unchanged. So, if 40 hours are worked and on top of that the overtime, the only variation would be the number of overtime hours at half pay and not the base salary from week to week.

It's interesting to note that FLSA also recognizez the non-exempt salaried who works a fixed number of hours per week. But in that case, the employer is allowed to treat the emplyee as an hourly, and dock hourly absences...but has to pay overtime (over 40 hours) at time and a half.