Failing to Pay Managers Overtime to Reduce Labor Costs

Bearing the brunt of budget cuts

Bearing the brunt of budget cutsEmployers often try to control costs by establishing labor or payroll budgets which limit the amount of payroll that can be spent on staffing the workplace.

For large companies with multiple locations, labor budgets are often set through corporate directives, and the managers at the locations have little or no input into deciding how much staff is needed for the operation to run smoothly. To keep labor costs low, the corporation often requires salaried managers to perform the same duties as hourly employees in addition to performing their managerial duties, or they will set a budget labor that is too low to adequately staff the business. However, that does not allow for hourly employees to work overtime hours.

When this occurs, it is common for managers to find themselves spending most of their time performing hourly duties instead of managing.  Managers who are salaried and classified as exempt work additional hours without exceeding the labor budget or causing the company to incur additional payroll costs, so they are often expected to work long hours, which they spend performing the same work as hourly employees.

In essence, the manager is a “glorified” staff member who can work limitless hours without having any impact on the labor budget. It is not uncommon for us to hear from managers who have compared their salary to what hourly workers would be earning if they worked the same number of hours and were paid overtime, only to find that their rate of pay is not much more than what the hourly workers earn.

Many salaried managers believe they can be legally required to work overtime hours without additional compensation. However, when a company’s model is to use a manager to perform a vast majority of non-managerial tasks, it is often the case that the manager’s non-managerial duties are more important than their managerial duties, particularly when the manager is also closely supervised by higher level managers or most of their duties are governed by corporate policies and directives.

Many “managers” will report that they spend as much as 90% of their time on the job performing the same tasks as hourly employees.  It is illegal for a company to classify a manager as exempt if the manager’s primary duty is to perform non-managerial tasks such as customer service, manual labor or sales, rather than actually managing the business and other employees. Under this scenario, the manager cannot be legally classified as exempt and must receive overtime pay for hours worked over 40 per week.

Shavitz Law Group has recovered hundreds of millions of dollars for managers who have been misclassified as exempt due to their primary duties being non-managerial. This is often driven by labor or payroll budgets that are set too low or that depend upon managers performing non-exempt tasks.

If you are working long hours as a manager due to labor budgeting, we can evaluate whether you may be misclassified.  If so, you could be entitled to recover overtime pay and other compensation for every hour you’ve worked over 40 each week. Contact us today at [email protected] or call us directly at (800) 616-4000 for a free consultation.



Helpdesk employees are essential employees, and they deserve overtime pay

Feeling helpless at your help desk

Feeling helpless at your help desk

Helpdesk employees are critical to all companies.  They fix computer issues and make sure that all systems work properly to allow the business to function.  Without Helpdesk employees, other employees would not be able to use critical programs, and businesses would suffer.  To keep business running, many Helpdesk employees work long hours and field calls from employees at all hours, day and night.

However, some companies do not pay Helpdesk employees for all overtime hours worked.  Helpdesk employees often receive a salary for 40 hours but never receive any overtime pay, even if they work more than 40 hours in a week.  Helpdesk employees also work from home but are not reimbursed for the cost of using their personal internet and cell phone data plans.

In recent years, companies have paid millions of dollars to settle unpaid wage claims for Helpdesk employees.

Even though Helpdesk employees are often paid a salary, they still may be able to claim back-pay for up to three years, plus double damages. Even if there are no time records, the law still provides employees a remedy and does not waive that employee’s ability to rely upon their reasonable recollection of hours worked.

Does this sound familiar to you?   If you are interested in pursuing recovery of such damages for your unpaid overtime wages please contact us today at [email protected] or call us directly at (800) 616-4000 for a free consultation. At Shavitz Law Group, we have helped thousands of workers stand up for their right to be fairly compensated.



Road Rules: Does your employer have to pay you for drive time?

Roadblock for drive time pay

Roadblock for drive time payWhen it comes to drive time, the rules of the road are often unclear. For hourly and other non-exempt employees who drive as part of their jobs, it is important to know whether and when drive time must be paid.

Generally, regular commuting from your home to your worksite is not compensable, even if your home is far away from your work. However, significant work performed at home prior to driving to work, such as calling or emailing clients, completing work-related paperwork, and mapping out their assignments may make the commute time compensable.

In addition, if you are required to stop someplace on the way to your job site, such as at your employer’s facility to pick up tools or parts, you are entitled to be paid for the time spent driving from the facility to the job site, and from the job site back to the facility, if you must stop at the facility before going home. There are also exceptions for employees who regularly commute from home to assignments in variable locations if the assignment impacts the employee’s ordinary commute to different locations.

Employees who drive from job site to job site must be paid for the time spent driving in between job sites.

Many employers pay for drive time separately, often at a lower rate of pay than they pay for regular hours worked. This is not illegal, so long as your employer notifies you in advance of the different rate and you are being paid at least minimum wage to drive, but all hours worked – including compensable drive time – must be included for determining whether an employee is due overtime pay at one and one-half times the employee’s regular rate of pay. When a different rate of pay is used, there is a special calculation that an employer must use in order to blend the various rates of pay to ensure they are paying the right amount of overtime.

Many employees who travel during the workday do not stop for lunch and eat lunch while on the road.  It is illegal for your employer to require that you clock out for a lunch break or automatically deduct time for lunch from your pay if you are eating while engaged in compensable drive time and do not actually take a break for lunch.

Employees who drive to a special assignment in another city and return the same day must be paid for their drive time, minus the amount of time they would normally spend on their commute.

Employees who drive to another city for an overnight trip must be compensated for drive time that occurs during the employee’s normal working hours on their regular workday or the same hours on their non-workdays. If the employee is required to drive to the assignment, then drive time occurring outside of regular non-working hours must also be compensated. Travel time outside of regular working hours as a passenger on an airplane, train, boat, bus or automobile is not considered work time and does not have to be compensated, unless traveling as a passenger to assist the driver is required by the employer.

If the employee performs work while traveling as a passenger, such as working on a laptop while on a plane, the time spent working must be compensated. In addition, while drive time from a hotel where the employee is staying to the job site and time spent sleeping is not compensable, all work performed must be compensated, so employees who perform work while at a hotel (such as working from a laptop or making work-related calls while in the hotel) must be compensated for their time spent performing work.

As you navigate the road rules relating to compensation, workplace drive time issues may arise.  We help employees ensure they are paid for their compensable work time.  If you have questions about your drive time being included in your hours worked, contact us at (800) 616-4000 or [email protected]. At Shavitz Law Group, we have helped thousands of workers stand up for their right to be fairly compensated.



New year, new potential for overtime pay: Understanding DOL’s Final Rule

Follow the rules: Get overtime

Follow the rules: Get overtimeThe United States Department of Labor has issued a Final Rule which will raise the minimum salary threshold applicable to the executive, administrative and professional exemptions.  The new rule will go into effect on January 1, 2020.  Currently, the salary threshold is $455.00 per week, or $23,660.00 per year.  Employees who meet the $455.00/week salary threshold, as well as the duties fall within the exemptions, need not be paid time-and-a-half for overtime hours worked.

Effective January 1, the new salary threshold will be $684.00 per week, or $35,568.00 per year.  This means that after January 1, 2020, if you are a salaried employee earning less than $35,568/year, you will be owed overtime pay for hours worked above 40 per week.   Employers have a choice if they want to maintain a salaried employees exempt status:   they can increase the salary to the new threshold, ensure they don’t work beyond 40 hours in a week to avoid having to pay premium pay, or re-classify the employee to non-exempt and pay time-and-a-half for overtime hours worked.

Additionally, if you already are a salaried employee earning more than the thresholds, you may be mis-classified as exempt if your duties don’t satisfy a specific exemption.   By way of example, if you earn a hefty salary for a retailer and are titled as an assistant manager, but you spend most of your time doing the same work as other hourly associates, then you may be owed overtime pay, despite being salaried and titled a manager. The Shavitz Law Group is a phone call or e-mail away to help evaluate your overtime rights despite being a salaried employee.

If you think you may be affected by the new Final Rule, and have questions about your compensation, please contact us today at [email protected], or call us directly at (800) 616-4000 for a free consultation. At Shavitz Law Group, we have helped thousands of workers stand up for their right to be fairly compensated. YOU EARNED IT, NOW LETS GO GET IT.


Manager of One: why you should pursue overtime pay as a small storefront or kiosk manager

Manager of no overtime

Manager of no overtimeMany retailers and service providers have reduced their footprint to make more use of small storefronts, kiosks, even mobile “carts” to sell their goods and services.

Usually, just one employee – maybe two during peak hours – are working at these locations. Frequently, that one person is the “manager” and is classified as exempt, so that they receive a salary but no overtime pay when they work more than 40 hours in a workweek.
However, even if the employer calls them a “manager,” to avoid paying them overtime, the law requires that an exempt classified manager has to supervise at least the equivalent of two full time employees (FTEs). So, the “manager” of a small storefront in a shopping center or a kiosk at the mall MUST still be paid overtime if they only supervise one other full-time employee.

If the manager works with part-time employees, their employer has to add up the hours that the part-timers work to see if the manager meets the “two FTE” requirement. The test requires that the “manager” supervise at least 80 hours per week of others working for the employer. If the associates work less than 80 hours per week total, then they are not two full-time equivalent employees. For example, if a manager works at a small store and works with three part-time employees, each working 24 hours a week, then the “manager” only manages 72 hours of work a week – less than the 80-hour requirement – the manager must be paid overtime pay whenever he or she works more than 40 hours in a week.

Are you a salaried small storefront or kiosk employee ? If so, you may claim unpaid overtime wages for the past three (3) years, plus an additional equal amount of damages (i.e. double damages) under the federal law known as the Fair Labor Standards Act (“FLSA”) if your store was not sufficiently staffed. The FLSA also provides for the employer, not you, to pay any attorney’s fees and costs incurred.

If you are interested in pursuing recovery of such damages for your unpaid overtime wages please contact us today at [email protected], or call us directly at (800) 616-4000 for a free consultation. At Shavitz Law Group, we have helped thousands of workers stand up for their right to be fairly compensated. YOU EARNED IT, NOW LETS GO GET IT.


Is Management Taking Your Tips? Employer with Sticky Fingers?

Lock down your tip jar!

Lock down your tip jar!Servers and bartenders work hard to make sure their customers have a great meal and fun time.  For that great service, they are rewarded with tips from the grateful customers.  These restaurant employees rely on those tips as the primary source of their income.

By law, management typically cannot take any portion of those tips.  However, that does not stop them.  There have been many lawsuits and large settlements where management took a percentage of the tips which should have gone to the servers or busboys or bartenders, and management tried to share in those tips. Additionally, an employer is not allowed to take a portion of a tipped employee’s tips to share them with employees who do not generally earn tips. For example, it is unlawful for an establishment to take a percentage of a server’s tips and give that to a cook or dishwasher.

Have you ever worked at a restaurant, bar, or catering hall and had management take a portion of your tips?

If so, the Shavitz Law Group can help.  We represent employees who were not paid all wages due to them.  We take on the biggest employers across the country and fight for YOU.   Your tips were left for you by a satisfied customer.   If your employer shared in your tips, please contact us today at [email protected] , or call us directly at (800) 616-4000 for a free consultation. YOU EARNED IT, NOW LETS GO GET IT.


Are you an Independent Contractor or Really an Employee Entitled to Overtime Pay?

Shavitz Law Group

Many Employers in Industries Such as Medicine, Mental Health, Construction, Transportation, and Finance Owe Overtime to Misclassified “Independent Contractors”

Some employers call them “Independent Contractors,” and in some industries, they call them “Per Diem,” or “Field Workers,”– but the result is always the same: Workers putting in long hours and not receiving time-and-a-half wages for overtime hours worked.

The workers usually are led to believe that, because they are called “independent contractors,” they are not entitled to overtime pay. However, the Fair Labor Standards Act and the wage and hour laws in many states say that these workers are, in fact, employees entitled to overtime, even if the employer called the worker an “independent contractor.”
Whether a worker should have been regarded as an employee entitled to overtime, and not an independent contractor, comes down to an evaluation of several factors: 1) whether the work is essential to the employer’s core business, and 2) the degree of control the employer exercise over the worker.
As to the first factor, for example, a worker who performs medical services for a medical service company drives for a transportation company or builds for a construction company – those workers are most likely employees entitled to overtime.

The second factor above comes down to how much control the employer has over the work performed. For example, if a healthcare worker is hired by a company as an independent contractor, they may nonetheless be employees entitled to overtime if:

• The worker is required to work at the location employer’s
• The worker must use forms and procedures provided by the employer
• The worker is subject to specific time constraints such as when the work is performed, or the number of hours required per week
• The worker is required to obtain permission for time off
• The employer requires the worker to attend staff meetings
• The employer has a continuing education requirement for the worker

If your employer classifies you as an independent contractor, you may in the eyes of the law really be an employee entitled to overtime wages for hours you worked over 40 per week in the past 3 years, as well as other benefits and damages.
If you have questions about your rights or would like to discuss these unpaid overtime claims and damages, please click here to complete our Contact Us form, and a member of our law firm will contact you.

The content of the article is for informational purposes only and does not contain legal or other advice and/or opinions. Shares and posts are not endorsements. Prior outcomes do not dictate future results.

13 States, Including Florida Raise Pay for Minimum-wage Workers

Shavitz Law Group

On January 1, 2014, the minimum wage for employees working in Florida rose to $7.93 per hour, a 14 cent increase.  Also effective on January 1, 2014, “tipped employees” in Florida who otherwise meet eligibility requirements for the tip credit under the federal Fair Labor Standards Act (FLSA) must be paid a direct cash wage of at least $4.91 per hour. This is an amount equal to the new Florida minimum of $7.93 per hour, minus the $3.02 hourly tip credit permitted under Florida law.

In addition, as of January 1, 2014, Florida employers will be required to post a new “Notice to Employee” issued by the Florida Department of Economic Opportunity.

Hourly employees working in Florida should review their pay stubs for work performed after January 1, 2014, to ensure that their employer has paid them at least $7.93 per hour for all their hours up to 40 in a work week and $11.89 for every hour thereafter.

If you have questions whether your employer is compliant with these most recent changes to the Florida minimum wage, please contact Shavitz Law Group for a free consultation.

On Jan. 1, the minimum wage in 13 states will increase to these amounts.

State New minimum wage
Arizona $7.90
Colorado $8.00
Connecticut $8.70
Florida $7.93
Missouri $7.50
Montana $7.90
New Jersey $8.25
New York $8.00
Ohio $7.95
Oregon $9.10
Rhode Island $8.00
Vermont $8.73
Washington $9.32