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Category: Unreimbursed Expenses

Articles and information on Unreimbursed Expenses

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Retaliation Frustration?

Shavitz Law Group

Did you ever feel that your employer treated you differently after you questioned your pay or overtime? After making such an inquiry, maybe your hours got cut or perhaps it’s something more significant like an undeserved reprimand. The Fair Labor Standards Act (FLSA) provides essential protections for workers, including the right to not be retaliated against for asserting a good faith belief that you’re being underpaid.

The anti-retaliation provisions of the FLSA cover variety of adverse employment actions. This basically means that an employer cannot “punish” employees for asserting their legal right to be lawfully paid for all of their hours worked. Employees can assert their legal rights in a variety of ways, including raising a pay issue informally, contacting the Department of Labor, filing a claim or lawsuit, or even participating in an investigation about an employer’s wage and hour practices. “Adverse employment action” includes a variety of negative consequences, including firing, demotion/failure to promote, pay cuts, or even more subtle changes like reducing an employee’s hours or responsibilities.

The FLSA ensures that employees can seek fair treatment without putting their job in jeopardy. Retaliation is a separate claim that employees can bring along with their original wage dispute and provides additional damages.

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AI May Make More Employees Eligible for Overtime

Shavitz Law Group

With the recent implementation of artificial intelligence (AI) in the workplace, the line between who is performing those duties — people or AI — can become less clear. While AI is undoubtedly a useful tool, it also can create shifts in workers’ duties which may raise issues concerning employees’ classification. Specifically, when AI replaces certain duties of employee classified as exempt, some of those employees may not maintain their exempt status and therefore would be entitled to overtime.

By way of example, if AI assumes managerial tasks such as decision-making, scheduling, supervision, or planning, previously exempt classified employees may be eligible for overtime compensation. One of the hallmarks of a managerially-exempt employee is the authority to hire or fire other employees. Similarly, one of the criteria for administratively-exempt employees is the ability to exercise discretion over matters of significance. However, when AI is utilized to determine employees’ productivity through tools like tracking keystrokes, mouse clicks, presence in front of webcam, and website browsing, previously managerially/administratively exempt employees may find themselves simply implementing AI suggestions rather than exercising discretion over those decisions, including hiring and firing, as well as others.

If you are an exempt employee who has had some duties assumed by AI, your exempt status may be in question and you may be entitled to overtime. Should you have any concerns about how AI has affected your eligibility for overtime, please contact Shavitz Law Group.

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How to Be Correctly Paid in the “Always-On” Culture of Remote Work

Shavitz Law Group

After the Covid lockdown, many employees transitioned to remote or hybrid work. While this new work setting has been beneficial to many, it has also brought new complications, including complications related to compensation.

The standard rule for overtime compensation is that a non-exempt employee must work more than 40 hours a week to be eligible for overtime compensation. Under most scenarios, such an employee is entitled to time-and-a-half of their hourly rate for the hours worked over 40 in a work week.

Tracking hours worked remotely can be difficult, especially if an employer fails to implement policies and practices to track all of the time worked by employees.  For example, answering phone calls or responding to messages on days off or before or after work hours has become the norm.  Although employees may feel like such duties are simply expected by employers, such tasks count as work for which employees should be compensated. And, if that extra time spent answering calls or responding to texts puts an employee over 40 hours  for that work week, then the employee is entitled to be paid time-and-a-half for those hours worked over 40.

The desire to meet employers’ expectations can make it difficult for employees to differentiate between work time (which is compensable) and their own leisure time (which is not). When the line between work time and leisure time is blurred it can foster an “always-on” culture. “Always-on” manifests in a variety of ways, including constantly checking and responding to emails (even during dinner or other non-working time), responding to messages and calls when not working, and even joining  Zoom calls while on vacation. Because employees can feel that they are “always-on,” these activities often results in unpaid overtime hours. However, employers must pay for all hours worked, regardless of when or where, and this is  particularly true for employers which presume that employees are available at all times.

In order to ensure that they are paid for all of their hours worked in this “always-on” culture, it is helpful for employees working remotely to keep track of all of the time they work, including time associated with tasks performed while they are off-the-clock. Importantly, even if employees do not log or track their own time and the employer does not provide the means for capturing all hours worked – including hours worked remotely —  the law permits such employees to rely on their best estimate of their actual, total hours worked.

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Artificial Intelligence and OT

Shavitz Law Group

Artificial Intelligence (AI) and Your Overtime Rights

As more employers start to use AI to keep track of time, tasks, and other work data, it is important to keep in mind that AI logs can be inaccurate, causing employees to miss out on overtime hours worked. The Department of Labor (DOL) recently issued a Field Assistance Bulletin (FAB) which outlines possible issues that may arise in the workplace with the rising use of AI and technology.

Tracking Work Time:

Employers can utilize AI to track whether an employee is “active” or “idle.” This can be done through tracking keystrokes, mouse clicks, presence in front of a web camera, and website browsing. However, the FAB cautions that without proper human supervision, AI tracking of work time can cause issues in determining the true amount of time an employee has worked because these tracking methods are not determinative of hours worked under the FLSA.

Monitoring Break Time:

AI can be used to create time slots for breaks based on previous data entries, such as prior time entries, usual shift times and break times, business rules, and other data. Again, however, this data may not always be accurate given an employee’s workload. It is imperative that human oversight is involved.

Work Performed at Multiple Geographic Locations:

Some employers use location-based monitoring to determine if an employee is working. However, complications may arise if the system fails to account for work done in different locations (i.e. employer asking employee to pick up supplies before heading to designated workspace).

AI and Prohibited Retaliation:

AI should not be used to “bust” employees engaging in protected activities, such as web searches regarding overtime rights, and taking adverse actions against said employees. In addition, AI should not be used to track employees who have filed a complaint with DOL investigators.

In sum, if an employer uses AI then employees must ensure that they are being properly credited for all of their hours worked. If employees are unsure, they can ask their employer if it is using AI and if it is, for what purpose. It should be noted such inquiries are themselves protected activity that an employer cannot retaliate against.

If you have questions regarding overtime or your employment, please contact Shavitz Law Group at [email protected].

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When High Earners are Eligible for Overtime

Shavitz Law Group

Highly Compensated Managers, Administrators, and Other Employees May Be Entitled to Overtime

While many believe highly compensated managers, administrators, and other employees are not entitled to overtime under the federal law known as the Fair Labor Standards Act (FLSA), that notion is incorrect. In the recent case of Helix Energy Solutions v. Hewitt, the Supreme Court held that if highly compensated employees do not satisfy the “salary basis test” – one of the essential elements for key exemptions to the FLSA – then the employees may be entitled to overtime notwithstanding their high salary. In Hewitt, the plaintiff earned over $200,000 per year. Nonetheless, the high Court held that because he was compensated on a day rate (per diem) basis instead of a salary basis, he was entitled to overtime.

Pursuant to the FLSA, in order for managers and administrators, as well as some other “white-collar” workers to be considered exempt from overtime they must (1) be paid on a salary basis; (2) earn above the minimum salary threshold which is, as of July 1, 2024, $844 per week (or $43,888 per year); and (3) have management or administration as their primary duty.

The issue in Helix Energy related to the first requirement. Specifically, the Court considered whether Hewitt’s day rate passed the salary basis test. The salary basis test requires employees to be paid a predetermined amount of money that is not subject to reduction based upon the quality or quantity of work done. Because Hewitt’s day rate varied depending on the number of days he worked each week, his compensation was not “predetermined” as required and therefore he was entitled to overtime for the hours he worked over 40 in a work week.

Helix Energy makes clear that the amount of money an employee makes is not dispositive of certain FLSA exemptions. Indeed, based upon his compensation and hours worked, Hewitt could be entitled to upwards of $11,500 per week in overtime. Thus, even employees making significant annual compensation can be overtime-eligible if their employer does not guarantee them an unvarying salary. This means that many engineers, banking and finance workers, and other high-income earners and professionals, may be entitled to overtime if they are not paid a salary.

If you have questions regarding overtime or your employment, please contact Shavitz Law Group at [email protected].

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California Employee Expense Reimbursements

Shavitz Law Group

The federal statute known as the Fair Labor Standards Act (FLSA) requires employers to pay overtime and minimum wage for non-exempt employees.  As a federal law, the FLSA applies nationwide. However, some states offer more protection than the FLSA. For example, in California, employers are required to reimburse employees for necessary expenses incurred while performing their jobs.

This requirement comes from Section 2802 of the California Labor Code, which ensures that employees are not forced to pay out-of-pocket for work-related expenses. Section 2802 specifically states: “An employer shall indemnify his or her employee for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties . . .” The protections of § 2802 are broad and apply to all employees.

Here are a few examples of how § 2802 operates:

Personal Vehicles

When employees use their personal vehicles for work purposes, employers must reimburse them for the associated costs. Reimbursement should cover all expenses related to the vehicle’s use, including maintenance, insurance, and wear and tear. The most common method for calculating this reimbursement is by using the IRS standard mileage rate, which provides a per-mile rate that factors in all these costs.

For example, if the IRS mileage rate is 67 cents per mile and an employee drives 100 miles for work, the employer would reimburse $67.

Use of Personal Cell Phones

Similarly, if employees use their personal cell phones for work, employers must cover a fair share of the costs. This includes voice calls, text messages, and data usage necessary to perform their job.

One approach is for employers to reimburse a reasonable percentage of the employee’s phone bill. For example, if it’s determined that 30% of the phone usage is work-related, then 30% of the monthly bill should be reimbursed. If you work in California and believe you have not been properly reimbursed for expenses you incurred as a direct result of your job duties, please contact Shavitz Law Group at [email protected].

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After-Hours Communications

Shavitz Law Group

The Fair Labor Standards Act mandates that employers compensate non-exempt employees for all overtime hours worked. What many employers fail to appreciate is that “work” encompasses not only to traditional tasks performed at a worksite. In this age of technology where communication can occur 24/7, various work-related activities conducted outside regular working hours are considered “work” for which employees are entitled to be paid, including off-site and after-hours communications, such as emails, texts, messages, and phone calls.

For instance, when non-exempt employees respond to work emails/texts/messages during evenings or weekends when they are otherwise off-shift, the time spent engaging in these communications is considered compensable work and should be factored into the calculation of overtime pay. Similarly, if employees are required to participate in work-related phone conferences outside of their standard work hours, the additional time dedicated to these activities qualifies as overtime.

Employers now take it as a given that they can communicate with their employees after hours, via email/text/messaging/phone. While such communication may be considered the “new normal,” employers are required to accurately track and pay for all compensable time, irrespective of the method or medium of communication. If non-exempt employees engage in work-related communications through emails, texts, messages, or phone calls after hours, when they are off the clock, they are entitled to overtime for those additional hours worked.

 

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Reimbursement for Expenses May Include Cell Phone, Home Internet Use and Related Home Office Costs

Track & Trigger: Work at home reimbursements

Track & Trigger: Work at home reimbursementsWe recently wrote about how employers may not accurately track the hours worked by remote workers, particularly for employees thrust into the “work-from-home” role as a result of coronavirus-related office closures and state and local stay-at-home orders.  To effectively work from home, almost all employees must use their own internet access, cell phones, tablets, or other devices.  In addition to internet and cell phone costs, some employees have incurred expenses to upgrade their equipment (faster laptops, computer cameras, headsets, workspace furniture, etc.) or to pay for subscriptions to services that allow them to participate in video work meetings, sales calls and otherwise perform their duties.

Although federal law does not require employers to reimburse their employees for their necessary expenses, many states do, including:  California, Illinois, Iowa, Massachusetts, Montana, New York, Pennsylvania, and Washington, D.C.  Each state has its own requirements as to what qualifies as a reimbursable expense, and what employees must do to notify their employer of the expense to trigger the employer’s obligation to pay.

If like many of us, you are working from home using your own equipment, internet access, and cell phone plan, you may be eligible to recover those expenses if you live in a state requiring reimbursement.  If you have any questions about reimbursable work-related expenses in your state, please reach out to the Shavitz Law Group at (800) 616-4000 for a free consultation.

YOU EARNED IT, NOW LETS GO GET IT.

Gregg Shavitz, Shavitz Law Group, 951 Yamato Rd Ste 285, Boca Raton, FL and 800 3rd Ave, Suite 2800, New York, NY.  Lawyers licensed in states including FL, NY, NJ, and TX.  The choice of a lawyer is an important decision and should not be based on advertisements alone.

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