The Department of Labor (“DOL”) released an opinion letter addressing whether certain overtime payments based on an expected number of hours may be credited towards the amount of overtime pay owed under the Fair Labor Standards Act (“FLSA”) and whether such overtime payments are excludable from the regular rate. The answer to both questions is yes.

The inquiry came from a business that provides in-home care services on a live-in basis or for shifts of 24 hours or more. The employer pays an hourly rate plus overtime based on anticipated overtime hours. The caregivers typically work five days a week for 120 or more hours. Given the nature of the caregivers’ work, the employer found it difficult to track which hours the caregivers were actually working. The employer therefore treats the employees as performing compensable work for the entire extended shift, minus 8 hours allotted for sleeping and meal breaks. If a caregiver has any work-related interruptions to meal or sleep periods, the caregiver is to track those hours and they are counted as compensable time. If a caregiver works more than anticipated, then the employer supplements the prepaid compensation at a rate of 1.5 times the caregiver’s hourly rate for each unanticipated hour of work over 40 hours.


Continue Reading Pay Me Now, or Pay Me Later? Wages Paid for Anticipated Overtime are Excludable from Employees’ Regular Rate

In July, we wrote about the Department of Labor’s proposed changes to the regulations governing the white collar exemptions of the Fair Labor Standards Act. The current regulations governing these exemptions—executive, administrative, and professional—include a salary basis test by which to determine if an employee meets one of these exemptions. The salary basis test currently

In case there was any question, an Indiana staffing company, Access Therapies, learned late last month that the Immigration and Nationality Act (INA) does not absolve employers of their responsibilities under state wage and hour laws. The Southern District of Indiana denied Access Therapies’ motion to dismiss a counterclaims filed by a Philippine citizen who

Direct Deposit Slip iStock_000017654852XSmall.jpgQ. We would like to require employees to accept pay via direct deposit. Is this permitted?

A. Direct deposit is an increasingly common method of paying employees, with numerous advantages for employees (fewer trips to the bank, no worry about losing a check) and employers (reduced cost and administrative hassle).

The Fair Labor Standards Act

Shortly after my co-author, Bill Pokorny, wrote about celebrity and Iron Chef Mario Batali’s multi-million dollar settlement of a class action tip pooling lawsuit, another celebrity chef here in Chicago was sued for violating tip pooling laws.  In March 2012, a lawsuit was filed against Master Chef Graham Elliot by 14 former employees over tip