Overtime Advisor : New York Employment Lawyer & Attorney : Greenwald Doherty Law Firm : NY Wage & Hour & Discrimination : Overtime Advisor Law Blog

Appropriate remedies for inefficient work are performance management and redistribution of workloads, not modification of time records regarding overtime. Employers should be realistic in terms of setting expectations for use of overtime and the workload assigned.  Even if workers take longer than the time designated for a task, employers still must pay overtime.  In short, to control overtime employers should manage their workers and discipline them if necessary, not modify time records. 

However, these rules can be hard for employers frustrated with employee performance to follow.  Even the federal government – this time, the U.S. Postal Service – has been accused of violating the federal overtime rules.  In a lawsuit filed on June 10, 2009 in the Eastern District of Texas, mail carriers in Texarkana and surrounding areas allege that the USPS violated the Fair Labor Standards Act by requiring them to deliver all assigned mail within eight (8) hours, even though their supervisors were informed or should have known that it would take longer.  The lawsuit also alleges that the supervisors would routinely modify time records to ensure that no overtime was recorded.  The lawsuit seeks $10,000 or more for each plaintiff and estimates that approximately 20,000 mail carriers might be part of the class – i.e., there is a possible total of $200 million in compensatory damages alone.   So, while it may be true that “neither rain, nor sleet, nor gloom of night stays these couriers from the swift completion of their appointed rounds,” when doing so takes more than 40 hours a week, mail carriers are entitled to overtime pay.

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Last year’s revelations regarding certain common  immigration and wage and hour violations within the kosher meat processing industry has led social justice groups within the Jewish community to take responsive action. Motivated mainly by Jewish legal and ethical imperatives, these groups are seeking to acquaint kosher processors with the law and prevent violations, like those notably discovered at the Agriprocessors plant located in Iowa last year. 

Among the steps they have taken is to devise a new “ethical seal” of approval for display by kosher restaurants and eating establishments. One such seal is known as “Tav HaYosher,” and is intended to indicate the establishment’s adherence to wage and hour law, particularly in the areas such as minimum wage, overtime pay, work breaks and tip distribution for those employees who mainly rely on tips. 

Reflecting its ethical component, the seal also conveys that the workers are treated humanely. The seal would be provided to establishments that meet detailed guidelines, and may include detailed inspections similar to those that are conducted in Israel by trained compliance monitors. A companion effort geared to kosher food manufacturers would place a “Hekhsher Tzedek” seal on food that is manufactured in accordance with the kosher laws as well as underlying Jewish ethical standards. 

Much has been made of the need to comply with federal and state wage and hour laws in order to avoid employee lawsuits, agency audits, and diminished employee morale. Although these practical considerations should be reason enough to motivate employers to comply with the law, needless to say, that is not always the case. The soul-searching engendered in certain portions of the Jewish community after the alleged processing plant abuses came to light suggest that ethical and moral considerations might provide certain employers with a separate (and perhaps more powerful) motivation to follow civil laws related to paying workers properly and treating them with dignity.

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On July 13, 2008, Massachusetts’  “Act to Clarify the Law Protecting Employee Compensation”  went into effect, making the Commonwealth the first state to mandate treble damages in wage cases. The Act also mandates that costs and attorneys fees be awarded in addition to treble (triple) damages in all successful civil lawsuits filed under Massachusetts' wage payment, prevailing wage, minimum wage, overtime, weekly wage and other miscellaneous wage-related laws. Previously, Massachusetts judges had the discretion to award treble damages, but considered such issues as whether employers had acted in good faith and whether violations had been willful. Prior to the new Act, judges followed the precedent set by the Massachusetts Supreme Court in Wiedmann v. The Bradford Group, Inc. [444 Mass. 698 (2005)], which established the option to award treble damages for willful violations only.

The Act has now been in effect for close to a year. Some predicted would drive business out of the Commonwealth and/or make it the venue of choice for class action wage and hour cases. Our informal survey of Massachusetts attorneys suggests that the most significant impact of the Act has actually been to move employers to the settlement table more quickly. 

Also, in January of this year a bill was introduced in the Massachusetts House of Representatives at the behest of the Associated Industries of Massachusetts (AIM) that would amend the Act to add one crucial word – “willful.” The bill, which currently languishes in the Joint Committee on Labor and Workforce Development, would amend the bill to mandate treble damages only in the case of willful violations. With the same governor who permitted the Act to become law still in place, it remains to be seen whether this bill will have legs. 

The Massachusetts Treble Damages Act is part of a wave of increased legislation and enforcement of wage and hour laws at the state level that is presently sweeping across the country. Employers, particularly in Massachusetts, need to take compliance very seriously in the current climate.

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In an all too familiar scenario, another large wireless operator has been forced to pay back wages for overtime work. This time, Sprint (which has paid out millions in collective action wage suits in recent years) paid a $120,000 fine after a federal labor investigation revealed that non-exempt employees at a call center in a Bristol, Virginia were not paid for “off-the-clock” work. 

Courts have held in similar situations at telecommunications companies (including Sprint) that “off-the-clock” work call center employees must do before they can take their first call of the day – booting up their computers, logging onto the company's network, opening computer programs and reviewing company e-mails –  constitutes preliminary work that is necessary to the principal activity performed by these individuals. Since this preliminary work is done for the benefit of the employer, it is compensable under the Portal-to-Portal Act. While the Sprint fine was based on an average of only 9 minutes per employee per day of unpaid time, a class action lawsuit just filed by former employees of a call center operated by APAC Customer Services, Inc. in La Crosse, Wisconsin alleges that employees (who engaged in the same type of activities before clocking in as the Sprint workers) were underpaid for 45 minutes per day for three years – and APAC has around 9,000 workers who could join this suit.  

Lawsuits in such situations have been more frequent and successful in recent years. This may be the result of the 2005 U.S. Supreme Court decision, Alvarez v. IBP [546 U.S. 21 (no. 03-1238)],which affirmed that when non-exempt employees perform “integral and indispensable” activities for their employer's benefit, their workday begins, and it continues until they complete their last task of the day.

The takeaway is simple. Companies must be aware of what non-exempt employees are doing before they officially “begin” the workday. Companies should develop a policy that ensures that non-exempt employees are not permitted to begin work prior to their regular starting time (or continue working after their ending time). However, employees who break the rules, even if they are disciplined, may be entitled to be paid for unauthorized overtime work in certain situations. Thus, workplace policies alone are not enough – companies must monitor and enforce these policies to avoid liability.

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