It seems it would be a no-brainer. You have one employee who works two different shifts, or even two completely different jobs. You set the employee up on two different time clocks so you can track the time the employee spends in each position. This can be helpful, especially if the employee is working at two different rates. However, what if the employee works over 40 hours in a workweek on the two positions combined. Is the employee entitled to overtime pay?
Absolutely. Failing to combine the two time clocks to determine the total number of hours worked by a single employee can be quite dangerous and costly. The time needs to be properly combined as required by the Fair Labor Standards Act (“FLSA”). Nieman Printing Inc. had to learn this the hard way, after paying $96,335.00 in overtime back wages to 101 employees as well as $26,000.00 in civil penalties, following a U.S. Department of Labor (“DOL”) investigation.
Specifically, the DOL found that Niemen Printing required employees to record hours worked on two different time clocks at the same site, but did not combine those hours to determine when overtime was due. In an interesting twist of the “two time clocks scenario,” investigators found that employees were under contract to Niemen by two separate staffing agencies at the same time, with hours worked Monday through Wednesday charged to one agency and hours worked by the same employees Thursday through Sunday charged to the other agency. The company set up separate clocks for the separate agencies.
As a result, employees did not receive overtime pay of 1.5 times their regular wage for working more than 40 hours a week. Getting the same employees through different agencies was seen as an improper mechanism to avoid overtime pay.
Employers should learn from Nieman Printing’s mistake. Two clocks can be used, but make sure you combine the employee’s time when determining the total hours worked for overtime purposes!