Don't Round Time Worked and Deny Employees Overtime Pay
Non-exempt workers need to be paid for ALL time worked. Failing to do so can lead to substantial liability, especially for unpaid overtime pay. Amazon.com may be in the process of learning that lesson painfully.
In November, a former warehouse worker filed a lawsuit seeking unpaid overpaid overtime plus interest. The suit alleges that Amazon rounded start and end times for shifts to the nearest quarter hour, costing workers up to 15 minutes of overtime pay a day. The lawsuit is seeking class action status, which could draw in up to 21,000 additional plaintiffs, so Amazon’s potential exposure is as great as the Kindle’s hype.
Rounding start and ending times is permitted under the law, as long as “it will not result, over a period of time, in failure to compensate the employees properly for all the time they have actually worked.” The Department of Labor regulation presumes that “this arrangement averages out so that the employees are fully compensated for all the time they actually work.” And in theory, it should: about half their shifts should be rounded down to the previous 15 minutes, and half the time it should be rounded up to the next 15. However, in practice, any system can be gerrymandered to the employer’s benefit. For example, if employees regularly start 5 minutes early and are held 7 minutes late, that would be 12 minutes per day they are not paid for—which is not allowed. Having a policy in place to clarify this can help which specifies how and when time is rounded.
There’s really no excuse for not tracking time properly—especially for Amazon. Although there is a rule that permits ignoring insignificant periods of time, this is only permitted when “the failure to count such time is due to considerations justified by industrial realities.” However, with today’s time clocks and computer-based time-tracking systems, there’s no reason for rounding off in large increments that create improper records. Amazon can track the tastes and preferences of millions of customers in thousands of product categories—it will be difficult to claim it lacks the technology to record shift lengths accurately.
