FLSA
Elizabeth13
4 Posts
Hi there-I am the HR Manager at a fairly small (110 employees) company which is part of a division where the head of our company is based at the other site. WE are part of a large company. I have been concerned that some of our people have been wrongly classified as exempt. So I have been looking into this more closely with the help of a coprporate person and the company employment attorney. I am quite confident that I am correct but now the head of our division is telling me that he wants no changes. He is concernedwith all the canges and layoffs, etc. that we have been through in the last year that the folks who are on salary now and would be changed to non-exempt will be more upset and he does not want to upset the apple cart.
What do you think? I don't see any signs of being audited for FLSA issues by the DOL although we were audited by the DOL last year by the OFCCP.
I would appreciate any comments/advice.
Thanks
What do you think? I don't see any signs of being audited for FLSA issues by the DOL although we were audited by the DOL last year by the OFCCP.
I would appreciate any comments/advice.
Thanks
Comments
However, you options are more that just reclassify everyone.
First, have you considered whether the jobs that are classed as exempt but you think are not-exempt, could be somewhat restructured to make the exemption apply. It is not unusual for an exempt job to become non-exempt over time because the job changes, an no one looks at the exemption. If minor changes to the duties can make the jobs exempt, consider making them.
Second, have you considered maybe making the employees salaried non-exempt. In that case they would get a salary for hours worked, then also get overtime. But it is less of a shock then going to hourly for the employees.
Third, you can make sure that these misclassified employees do not work more than 40 hours per week. If that is the case, it really does not matter if they are mis classified because they wouldn't be due any overtime anyway. (NOTE; the employer needs to keep records, and if it doesn't the employees word will be taken about how many hours worked).
Fourth, calculate what your liability is for the past misclassification (overtime laws go back 2 or 3 years depending on whether the violation was willful). I would assume 2 years, and calculate wages that would be owed. Then the company can consider if it just wants to pay back wages and reclassify the employees (which should not really get the employees angry, because they would be getting more pay). Also, this liability data can be used to convince management that the situation should not remain without some action.
Your manager is correct to worry about communicating the issue to the employees. If not handled correctly, it could backfire. But what could backfire much worse is if any of the employees get wind of the fact that managment knew they were not being correctly compensated and took no action. A careful communication strategy can overcome these issues.
Please note: Misclassification is being a HOT issue. Many employee's attorneys have learned that they can make big bucks by bringing a class action misclassification lawsuit against an employer. If one employee goes to an attorney, you can bet that the attorney will look at all employees and try to turn it into a big case.
Good Luck!
The consulting group I contract with is presenting a seminar on wage and hour law in Portland on January 29th. If you're interested, I can e-mail you the info they sent me.
Eric