Calculating hourly pay

wiremanufacturer · December 2002

We calculate an hourly employees pay using the 6 minute rule. If an employee works from 6:03 to 2:30 they get paid 7.9 hours (we get 30 minute lunch). If an employee works from 6:57 to 2:30 they get paid 7 hours. This has been questioned if it is legal since we are not actually paying an employee for every minute they are working. If we must pay for every minute does anyone have suggestions on how to calculate manually.
Thanks
Susan

Anita · December 2002

I'm not sure what you mean by the 6 minute rule. I would think that it would mean they could clock in 6 minutes early or 6 minutes late and still come up with the same start time.(ie, 5:54-6:06) would still be 6am start time.

We use the quarter hour and which ever is the closest quarter is how we pay.

NaeNae55 · December 2002

I believe if you have a policy in place and follow it consistantly, you are not violating FSLA. Fortunately, legislators understand the hassle of having to calculate every single minute. Since you adjust both before and after the hour, it should pretty much all equal out. Of course, you may live in a state that requires a minute to minute calculation, but I have never heard of one.

Good luck

wiremanufacturer · December 2002

Thanks for your help. Yes we are consistent we have calculated payroll the same way since we opened (1994). I just didn't want to get caught up in the "this is the way we've always done it" mode.

Theresa Gegen TX · December 2002

As far as rounding the time by 6 or 10 or 15 minutes, the rule is that the employer must round up as well as round down. An employer who always rounds down (so that the rounding is always in the employer's favor) would violate the law.

Pork · December 2002

Susan, Refer to Regulations Part 785 "Hours worked under the FLSA of 1938, as amended, section 785.48 (b) page 12. "Rounding Practices" is the law...."provided that it is used in such a manner that it will not result, over a long period of time, in failure to compensate the employees properly for all the time they have actually worked". This means rounded must work fairly for both the company and the employee. You can not round forward for the company and not round backwards for the benefit of the employee. In our company we use the 7/8 minute rule. If 8 minutes before the quarter hour we roll back to the quarter hour. If 7 minutes until we roll forward to the quarter hour for both reporting to work and the departure from work. Good luck, hope this helps! Pork

Calculating hourly pay

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