Making a payroll mistake could mean getting reported to the Department of Labor. It could mean that you’ll get sued, fined, ordered to pay back wages, and forever fear the DOL. It’ll be an ugly mess over an honest mistake, right?
Well, not necessarily. If employers honestly try to follow the rules and don’t deliberately try to reduce overtime, the DOL may be lenient with a payroll mistake. At least that’s how it has appeared in a recent case.
On March 6, 2018 the Department of Labor launched a pilot program allowing employers to audit their own pay practices and catch and report their own wage and hour mistakes. It’s called the Payroll Audit Independent Determination (PAID) Program and will operate for six months as a pilot program.
Prior to now, wage and hour mistakes would land employers in court where they would have to pay court and lawyer fees, back wages, and liquidated damages. With the PAID program, if mistakes are caught independently and in good faith, employers can avoid the extra costs and simply pay employees back for the mistakes made.
With the exempt salary threshold saga finally behind us, the latest Bed Bath & Beyond wage and hour suit is a good reminder that following the FLSA’s exemption status requirements is just as important as ever.
Employers hear a lot about overtime violations and other wage and hour offenses. There are so many rules to learn and so many cases in the news. It can be a little scary to think about the consequences of getting an employee’s payroll wrong.
There’s some good news and some bad news for employers in this regard.
Owners of very small businesses often do everything themselves. They don’t have an HR person reminding them what’s legal and what’s not and so they try to keep up with the changing federal and state laws on their own. The problem with this approach is that many small business owners don’t even know what to watch out for. It’s hard to be compliant with wage and hour labor laws when you don’t even know them. Employers running very small businesses should be familiar with wage and hour best practices so that they can avoid labor lawsuits.
Overtime violations are something all employers want to avoid but a lot of small businesses don’t know overtime law. Running a small business is hard enough without also having to be familiar with all the federal and state labor laws.
It’s our job to know overtime laws. That’s why we’ve put together this infographic. It highlights the most common ways employers violate overtime laws, how to avoid violations, and the penalties that might ensue.
How to Avoid Overtime Violations
An HR consultant or in house HR department can help companies stay compliant with overtime laws. Human resources professionals are trained in labor laws and are a great resource to have on your team.
However, some small businesses cannot bear that expense. This infographic will help keep you informed so that you can make good labor decisions. Using a time tracking service will also help reduce the possibility of errors.
Making a mistake on your employee’s payroll obviously costs the employee their due wages but it can also cost you, the employer, in lawsuit damages. This is the last place you want to end up. Wage and hour lawsuits are expensive. And with the Department of Labor planning to hire 300 more investigators, small businesses will be even more at risk for getting caught.