Articles Posted in Wage and Hour

Given the technological advancements over the past few decades, more and more employees are expected to be on call – either officially or unofficially – all day, every day. Most often, this occurs when an employee receives a phone call or email after they have left the office for the day. And depending on the sender of the communication, the subject, and the workplace culture, an employee may feel as though they must address the issue although they are technically off the clock.

The question frequently comes up whether an employee must be compensated for this type of work. The answer depends if the employee is exempt or non-exempt. Non-exempt employees must be paid for all the time they work, whereas exempt employees do not. If a non-exempt employee is not paid for their off-the-clock work, they can pursue an FLSA or unpaid wages claim against their employer.

An exempt employee is one who is exempt from the minimum wage and overtime requirements of the Fair Labor Standards Act (FLSA). For an employee to be characterized as exempt, an employer must pay them a salary rather than an hourly wage. The idea being that an exempt employee is compensated for getting a job done, regardless of the time it takes. Typically, exempt positions are reserved for executive, management, and professional employees.

For many Texas employees, monetary pay is only a part of the overall compensation package offered by employers. For employees who have children or care for a sick family member, the paid- and unpaid-leave benefits provided by many employers are just as important as one’s salary or wages. Unfortunately, Texas employers are not required under any state or federal law to provide paid-leave benefits to employees, except under certain circumstances.

As a general rule, a Texas employer can decide whether to offer benefits to its employees. There are times, however, where an employer is required to provide certain benefits to its employees. One example is where an employer’s written policy provides benefits to employees, but the employer denies a qualifying employee access to these benefits. The Texas Payday Law states that an agreement to provide paid or unpaid leave is an enforceable term of the wage agreement. Thus, an employer who may not be required by law to offer benefits becomes obligated to provide them if there is a written policy offering benefits to qualifying employees.

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For those who work in the service industry, the importance of tips cannot be overstated. Many service employees work primarily for tips, meaning that their employer only provides them with a minimal level of base hourly compensation. Thus, for many service employees, their lives literally depend on the amount of tips they bring in.

On its face, the concept of tipping seems to only benefit the employee receiving the tip. However, over the years, employers have also found ways to benefit from society’s expectation that an employee will be tipped for the services they provide. For example, under Texas law, an employer is able to pay a tip-eligible employee less than those employees who do not receive tips by taking a “tip credit.”

A tip credit is an adjustment that employers can make to a tipped employee’s wage, assuming that the employee will make up the difference in tips. For example, the minimum wage in Texas is $7.25/hour. However, an employer only needs to pay a tip-eligible employee $2.13/hour. The remaining $5.12/hour is considered a tip credit. If, however, the employee does not bring in at least an additional $5.12/hour, the employer will be required to pay the difference. Thus, tipping allows for an employer to pay its tipped employees less than they pay non-tipped employees.

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The federal minimum wage for hourly employees is $7.25 per hour. Unlike other states that allow for a higher minimum wage, the Texas minimum wage is $7.25. Advocates of a higher minimum wage have cited the unrealistic expectation that people are able to live on $7.25 per hour. Furthermore, they have argued that a higher minimum wage will foster the economic growth of the United States and close the gap between low- and middle-income families.On the other side, those in favor of keeping the minimum wage lower argue that employers cannot keep up with the higher wages and will have to lay off more employees, increasing the unemployment rate. However, despite the opposition to increasing the minimum wage, the fact remains that individuals in these positions often face many obstacles surviving on so little income. In some cases, employers will try to get around complying with the minimum wage requirement, which leads employees to face even more issues.

There are very few instances when an employer does not need to comply with federal minimum-wage standards. Some exceptions are if the employee is a farm worker, student learner, independent contractor, or tipped employee. If an employee is not sure if they fall into one of these categories, or they believe their employer is not complying with federal statutes, they should contact a Dallas wage and hour attorney.

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Studies have found that employers underpaying workers is a huge problem in America. Texas is not immune from this problem. From 2014 to July 2017, $29.5 million in back pay was awarded to workers under the Texas Payday Law. However, this figure may not represent what’s truly owed. It doesn’t include back pay owed to workers who don’t realize they’ve been shorted, or who are undocumented and are afraid to involve the government for fear of deportation or other retaliation.

From January 2014 – July 2017, there were 42,788 complaints filed under Texas law. Eight hundred employers were assessed bad-faith penalties of $1.17 million for knowing underpayment of workers. Under Texas law, individual penalties cannot be more than the lesser of $1,000 or unpaid wages.

Sometimes Texas employers require or encourage workers to do work “off the clock.” This is work that isn’t compensated and isn’t tallied as part of your weekly hours when calculating overtime. Off-the-clock work may be illegal. Assuming you are a nonexempt employee, the time you spend doing things for your employer is supposed to be compensated. However, in some cases, employees do not realize this. They may volunteer to do work off the clock so that they seem appropriately enthusiastic about their careers, or simply because they enjoy working.

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Waiters and bartenders are among the least compensated people in the nation. Their median hourly wage is $9.61 each hour. Under the Obama Administration’s 2011 regulations, their tips are their property. These regulations prevent an employer from using the tips for any reasons other than as a credit against its usual obligation to pay its employees minimum wage or in order to create a valid tip pool. Valid tip pools are sharing arrangements among employees who customarily get tips, like wait staff, but they don’t include employees who don’t customarily get tips, such as dishwashers or janitors.

Moreover, under section 3(m) of the Fair Labor Standards Act, an employer is permitted to take a tip credit toward its minimum wage obligation for tipped employees that’s equal to the difference between the required cash wage and the federal minimum wage. In certain situations, an employer is able to claim additional overtime tip credit against its overtime duties.

The United States Department of Labor has estimated that around the country, there are about 1.08 million wait staff and 219,000 bartenders who receive tips in 280,000 establishments.

Sometimes Texas workers believe that they must be as helpful as possible to an employer, even if it means working off the clock. For example, sometimes workers come in early to help an employer set up for that day’s work, but they don’t punch in for that period. Or, sometimes, an employee participates in work during lunch hours that isn’t counted toward their work hours for that week. Under the Fair Labor Standards Act (FLSA), work that is not counted toward overtime or goes uncompensated is illegal.

The FLSA requires that nonexempt employees be paid overtime if they work more than 40 hours per week for all work done. Most employees are considered nonexempt and are covered by the FLSA for the purposes of overtime, as well as the minimum wage. Exempt employees are those who are considered professional, administrative, or executive, or are within certain industries such as commission-based sales.

All work for an employer should be on the clock. If an employer requires or allows employees to do any work for it without compensating the employee and counting it toward weekly hours for the purposes of calculating overtime, it is “off the clock.” What counts as work? Whenever an employee engages in work that’s not requested but allowed, such as helping a colleague or coming in early to set up, this is work that is completed and should still be compensated.

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Many workers do not realize that they do not need to go off the clock for short lunch breaks or snacks. If you take yourself off the clock for breaks under 30 minutes, you may not be getting the wages to which you’re entitled.

There are many employment practices not regulated by the federal Fair Labor Standards Act (FLSA). For example, there’s no requirement under the FLSA that you get vacation pay, meal periods, holidays off, premium compensation for working weekends or holidays, pay raises, a reason to be discharged, or pay stubs. There are no collection procedures in place if you are promised wages or due commissions that are greater than what’s required. Moreover, there are no limitations about how many hours in a single day you can be scheduled to work if you are at least 16 years old. Generally, these issues are agreed upon between an employer and an employee.

However, rest periods or short lunch breaks are quite common in all workplaces. There is no requirement that a lunch or coffee break be given under federal law. However, if your employer chooses to offer you a short break, these breaks are considered compensable hours that are included when determining overtime and minimum wage, and they are regulated under the FLSA. Any rest period of short duration (such as one that is 20 minutes or less) is supposed to be paid as working time and included when calculating overtime.

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The Fair Labor Standards Act (FLSA) is the federal law that regulates minimum wage and overtime, including how these issues should be handled in connection with a summer internship. Employment is defined broadly such that anyone who is suffered or permitted to work is employed. The United States Department of Labor enforces the FLSA, and it uses a six-part test to decide whether you should be paid minimum wage for your summer internship.

An unpaid internship is only appropriate under the six-part test when:  (1) the intern doesn’t displace a paid employee, (2) the internship is for the intern’s benefit, (3) the internship is similar to training that would be provided in school, (4) the employer doesn’t benefit from the intern’s work and sometimes may be disrupted by what the intern is doing, (5) the intern isn’t promised a job once the internship is over, and (6) both the intern and the employer understand that the job is an unpaid position.

If you are closely supervised by existing staff and are not “seasonal help,” you probably didn’t displace a paid employee. However, if your employer would have hired more people to do the work you’re doing if you hadn’t joined as an intern, you are likely entitled to FLSA pay.

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The eight-hour workday was developed during the Industrial Revolution so that workers doing manual labor in a factory would not have to work as many hours. Prior to that, in the late 18th century, factory workers worked 10-16 hours days to keep factories running 24/7. A campaign was started to have people work no more than eight hours in a day so that they would have eight hours of work, eight hours of recreation, and eight hours of rest. The campaign was successful.

The goal was humane, but it doesn’t take into account our modern situation in which employees who work steadily for hours on end, sometimes for 10 to 12 hours in a day, are assumed to be more productive than employees who take breaks. According to the Bureau of Labor Statistics, the average American actually works 8.8 hours in a day. This is more time than the average worker spends doing anything else.

However, one study shows that workers who take brief breaks are more productive than those who keep working continuously for more hours, regardless of the number of hours they were working overall. Ideally, according to that study, there is an hour of uninterrupted work and then a break of about 15-20 minutes.

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