Tuesday, September 27, 2022

Dispelling six common wage and hour misconceptions


19 hours in a workday without overtime pay. That's how one Amazon delivery driver described his experience working for online conglomerate.

To be clear, while it might make for an awful work environment to work a 19-hour shift, there is nothing in the federal wage and hour laws that require overtime pay for a 19-hour workday. 

Overtime under the federal Fair Labor Standards Act is based on hours in a work week, not a workday. (Please check your state laws, employers in Alaska, California, Colorada, and Nevada, as your overtime obligations might be tied to hours in a workday, not work week.) The FLSA only requires time and a half of one's regular rate of pay is required for any hours in excess of 40 in a week. 

While it's easy to imagine 19-hour days quickly adding up to a number over 40 hours in a week, 19 hours in one workday, in and of itself, does not qualify one to overtime pay under the FLSA. 

Here are five other common FLSA misconceptions that can (and usually do) trap the unwary employer.

  • Assuming that all salaried employees are exempt and therefore not overtime eligible.
Under the FLSA, an employee is nonexempt (and therefore overtime eligible) unless the employer can establish that he or she meets a specific exemption. A base salary of $684 per week is only one part of the FLSA's test for certain exemptions. The other part — the duties test — requires the employer to show that an employee meets certain job-related requirements. Without meeting both the salary test and the duties test, an employee is nonexempt.

  • The administrative exemption covers all administrative employees.
It's unfortunate that the administrative exemption is called the administrative exemption, because it creates the false impression that anyone performing administrative functions meets the duties portion of that exemption. In fact, the administrative exemption only applies to a narrow group of employees — those whose primary duty is the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers, and which includes the exercise of discretion and independent judgment with respect to matters of significance.

  • Unauthorized overtime need not be paid.
The standard for whether an employer must pay an employee for time spent working is whether the employer knows or should know that the employee is working. Authorization of the time as working time plays no role in this calculus. The remedy for an employee working "off-the-clock" without authorization is discipline or termination, not withholding pay.

  • Commissioned workers aren't entitled to minimum wage and overtime.
Some commissioned workers are exempt, but the mere fact that one is paid on commission is not the determining factor. To be exempt, an employee must meet all of the requirements of at least one exemption. To meet the "outside sales" exemption, an employee's primary duty must be making sales customarily and regularly away from the employer's place of business. 

  • Independent contractors aren't owed minimum wage or overtime.
Technically, this is correct. However, the test for who actually qualifies as an independent contractor is so strict that it's all too easy to misclassify an employee as an independent contractor and err in how they are paid.


What wage and hour misconceptions would you add to my list? Drop a comment below or @ me on Twitter with the hashtag #FLSAmisconceptions. I'll compile the best in a future post.