Non-profits and FSLA

dcastaneda · April 2005

I just got off the phone with FSLA and was surprised at the answer I received. Did anyone know that if you are a non-profit, to be eligible for OT pay, you must have some form of out-of-state commerce and this is based on each EE. In other words, if the receptionist gets an out-of-state phone call and works 40+ hours for that week she is entitled to OT, but if the bookkeeper does not do any type of out-of-state commerce that week and works 50 hours, she is not entitled to OT. This is a week by week, EE by EE, requirement. Am I the only one that had no clue about this? x:-/

marc · April 2005

[font size="1" color="#FF0000"]LAST EDITED ON 04-29-05 AT 10:45AM (CST)[/font][br][br]I have not heard that. We are also a non-profit, just a few miles from the CA border - so we have a fair amount if interstate activity.

Sounds like I have some research to do.

By the way - it's FLSA, Fair Labor Standards Act.

dcastaneda · May 2005

I know, I have a tad of dislexia. Sorry.

Geno · April 2005

Never hear of that exemption -- interesting though. Before I'd got too excited about it, I would want to know exactly how your contact at the DOL defines "out-of-state" commerce and make sure that they didn’t really mean “inter-state commerce.” The reason being that in this day and age (global economy) it is almost impossible not to be involved in some type of “inter-state” commerce in some form or another. Will be interesting to hear from others who may know more about this concept.

GENO

Geno · April 2005

[font size="1" color="#FF0000"]LAST EDITED ON 04-29-05 AT 01:50PM (CST)[/font][br][br]dcastaneda,

You might find the attached links of interest. GENO

[url]http://www.advantagepayroll.com/accountants/erguide4.asp[/url]

[url]http://www.twc.state.tx.us/news/efte/flsa_most_common_pitfalls.html[/url]

dcastaneda · May 2005

Thank you. So what is your take on this whole thing, I am so confused. I still think the EE should be paid OT, but unfortunately, I am in the minority in my office.

Shadowfax · May 2005

I had never seen that microsoft web site, but after a quick glance, I think I would be reluctant to rely completely on it!

Don D · April 2005

Three possibilities:
1) You misunderstood the government employee.
2) The government employee is untrained and wrong.
3) I don't know what I'm talking about.

yakley · May 2005

We're a political subdivision in TN - public employer; what's the definition of non-profit employer? We've been checked and double checked and our employees are eligible for OT. Only difference for us is that we can accummulate comp time in lieu of OT pay.

smsbookkeeper · May 2005

We are also a public employer, an elementary school, and we pay our employees overtime over 40 hours. My understanding is that FLSA applies to us with the addition of comp time being allowed as we are non-profit.

Shadowfax · May 2005

I really don't understand the comment as being only about non profits, since the FLSA doesn't apply to anyone - profit or not - unless the commerce tset is met. Before the 1961 amendment, all coverage was 'individual' as oppossed to 'enterprise'. So if the operation is of sufficient size, (I think it is $500,000) annual, engaged in commerce, then as an operation you are on the hook for FLSA. If you have a small operation not generally engaged in commerce, but individually employees have duties 'affecting commerce' then you can still experience individual coverage as opposed to enterprise coverage. Of course, since 1985 all state and local governments have been subject to FLSA.

jennifer jo · May 2005

Don, as much as I'd like to concur with your third option, I believe the first or second option are most feasible.

njjel · May 2005

[font size="1" color="#FF0000"]LAST EDITED ON 05-03-05 AT 08:51AM (CST)[/font][br][br]Never heard tell of such a thing myself and NJ law requires we pay OT hours at time and one half for all hourly ee's.

Don D · May 2005

Jennifer Jo: Every comment you have ever made about me or my posts is negative. Can you either lighten up or take a leap? Thanks.........

Don D · May 2005

[font size="1" color="#FF0000"]LAST EDITED ON 05-09-05 AT 06:25PM (CST)[/font][br][br]Sorry, double post. But, I mean it doubly anyway.

stilldazed · May 2005

My employer is nonprofit, single location, service organization, closely associated with a church, and has been for 90+ years. A story some of the 'old timers' still recall not so fondly in senior mgmt staff meetings is losing an OT dispute in the late 70s that cost the company thousands of dollars. If the story you got is correct, DOL must have made a mistake in the 70s!

System · May 2005

I have just come from a private employer to a not-for-profit organization, and I am a little confused. I didn't think anyone was exempt from FLSA except government employees could substitute comp time for OT. By the way, we have no timekeeping system, and I am shocked at that too. Most admin staff has been paid as "salary", and I am approaching a panic mode. No clock in our out times for the hourly (non-exempt) just hours per day recorded. Any suggestions on how to tackle this without a mutiny forming with the installation of a timeclock? People wander in in the morning at their leisure, but have been reporting 8 hours a day.

Shadowfax · May 2005

See post #9, it is hard to imagine e/ers who are not subject...but there may be a few - or at least a few ees in a few empers operations who are not covered. Of course, paying as 'salary' may be no problem if there is never any o/t involved - but you may not be getting your moneys worth either. Time keeping is another problem, and a favorite rant of mine. Everyone, both exempt and non should be keeping time records that they have to in some way verify - if only by signature - as accurate. Easiest way is to simply say it is a necessary record to be kept for all kinds of reasons (except for pay purposes if ee is exempt) including liability and knowing when peoploe are there or not. It will probably take you a couple of weeks to get everyone doing it - and there may be some griping during that time, but it will go away. Just stay on them and insist.

stilldazed · May 2005

You seem to be faced with many of the same challenges I found myself faced with at my present employer. I support Shaddowfax in that you pick an issue and pursue it will persistence. I will add that you should be prepared for the potential of a great deal of resistance. Much of what you currently face may be deeply engrained in your company's culture. My successful projects to date, and there have been few in nearly 4 years, have resulted from a multiple-point approach: education/information to the top level of management for their buy in and support for change, very careful grassroots guidance for the worker level (very careful to potentially minimize negative fall out), and extensive research by me to identify clear sources so I can back up my position on the issues. Even with that, I can't tell you how many times I have been the "bad guy" accused of "making this stuff up" or of being an alarmist who gets carried away with what-if scenarios. It will be frustrating, but the wins will be rewarding. Take baby steps and, wherever possible, tackle one issue at the time. Remember, you may not see results overnight, you're just the messenger, and your intent is aimed at the good of everyone. However, your changes will also mean changes for other folks, and many people see change as a painful process.

Best wishes.

marc · May 2005

I did the same thing back in the winter of 99 (sounds so much more dramatic than 5 1/2 years ago).

There are lots of changes to be made when you make this transition. Non-profits need the for profit mentality in many areas, HR included. I would suggest you get your list of changes together and prioritize them. Spend some time building up trust banks with the various shakers and movers in your company, and establish a relationship with a good HR attorney. It took some time to find one for us, but we got one who even discounts her rate significantly just because of who we are.

This person can do great things for you with respect to top level trainings in areas like harassment, ADA, FMLA. Having outside confirmation of your teachings will help cement your credibility.

Then tackle those areas like the timecards. We don't use a clock either, just an excel spreadsheet with both EE and supervisor sign-off on the way to payroll. At least you have a signature. Then supervisor becomes aware of signing off on hours claimed - this leads to attendance and tardiness policies. A very touch area.

Finally, going back a couple of years to estimate unpaid overtime can be an interesting exercise. In our case, no-one had any records to determine if OT was even worked, so when we made the transition to properly tracking hours and properly classifying exempt and non-exempt, we did not have additional costs. Just a couple of examples of big fines and payments assessed against local employers for not properly paying OT was enough to get the boards attention.

Then tackle the handbook. I am sure your eyes will be wide with surprise and dismay when you work you way through it.

AT the end of each day, the rewards working in a non profit are incredible - but not necessarily included in your paycheck. I would not trade them in.

Non-profits and FSLA

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