Articles Posted in Wage & Hour Issues

As an employer or an employee, compliance with the Fair Labor Standards Act is important to you. If you are a worker, non-compliance often means denial of the total compensation the law says your employer owes you. As an employer, non-compliance can have numerous damaging and costly consequences. If you have questions about FLSA compliance, including classification and exemption issues, make sure you are getting reliable answers by contacting an experienced Atlanta wage and hour lawyer.

For employers, misclassification is a common basis for FSA violation liability. Errors can occur in the context of employer-versus-independent contractor classifications or exempt-employee-versus-non-exempt-employee determinations. When deeming a worker as an exempt employee, it is important to identify all bases under which that worker may be exempt under the law, as a recent ruling from the 11th Circuit Court of Appeals illustrates.

The unpaid overtime case involved an auto dealership group in West Palm Beach, Florida, and three of its call center employees. The employees, who worked in the dealership’s “business development center,” a separate building next door to the dealership’s auto showroom, spoke to prospective car buyers over the phone to convince them to make appointments to visit the showroom and speak with showroom salespersons.

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These days, ads for artificial intelligence-related programs and applications seem to be everywhere. AI has the potential to do many beneficial things like making workplaces more efficient and safer. It also has the possibility of negative impacts, including in the area of employment law. The U.S. Department of Labor’s Wage and Hour Division (WHD) recently released a publication warning of ways that AI can lead employers into violations of the Fair Labor Standards Act. Whether or not they are tied to AI, an experienced Atlanta wage and hour lawyer can provide very human answers to all your questions about FLSA compliance.

The WHD’s recent publication, Field Assistance Bulletin No. 2024-1, looked at ways AI could lead an employer into non-compliance. The first area the division discussed was AI productivity monitors.

Modern AI technology can monitor workers “in real time,” using metrics like website browsing, the number of computer keystrokes or mouse clicks, or eye movements (via webcam,) to ascertain an employee’s activity and productivity levels. While employers may use this technology and these metrics to assess employees’ diligence and productivity, those determinations do not necessarily govern how the law calculates workers’ hours worked.

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Many bartenders, restaurant servers, and others in the hospitality industry depend on tips for a substantial portion of their compensation. In these industries, minimum wage and overtime disputes are common, whether they arise from good-faith recordkeeping errors or intentional misconduct by employers. Whether you are an employer or a tipped employee, look to an experienced Atlanta wage and hour lawyer when you have questions about the laws and regulations regarding tipped work.

If you are a tipped employee or your team includes tipped employees, it is important to understand thoroughly the FLSA and the Labor Department’s rules regarding tipped workers.

The FLSA bars employers from paying tipped workers only in tips. Minimum wage law requires employers of tipped workers to pay those employees sub-minimum wages, but that sub-minimum floor is not zero. For states that do not have standards above the FLSA requirement, federal law controls.

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Commentators sometimes cast independent contractor status as a tool for employers to exploit employees and avoid paying those workers properly. In reality, independent contractor status can provide substantial advantages to workers… and some prefer it. With the U.S. Department of Labor’s new final rule regarding employee-versus-independent-contractor status having taken effect on March 11, independent contractors and hiring entities may wonder what they can do to ensure compliance with the new rule. A good place to start is peaking to a knowledgeable Atlanta wage and hour lawyer.

As noted above, some workers firmly prefer independent status. Independent contractor status allows workers to set their own schedule/hours, control how they do their work, and, in many situations, not have the income limitations that salaried work does.

One industry with many independent contractors is real estate. According to the National Association of Realtors, around 89% of its members work as independent contractors.

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One way for an employer to defeat an employee’s unpaid overtime claim is to establish that the worker was exempt from those provisions in the Fair Labor Standards Act. The law has several types of FLSA exemptions, including the executive exemption, the administrative exemption, the professional exemption, the computer employee exemption, the outside sales exemption, and the highly compensated employee exemption, among others. Whether you are an employee or an employer, understanding the scope of these exemptions, and when they do (or don’t) apply can be crucial. An experienced Atlanta wage-and-hour lawyer can provide much-needed advice and information about these exemptions.

A recent case from the Middle District of Georgia looked at one exemption in particular – the administrative exemption.

According to the employees’ lawsuit, their employer illegally failed to pay them overtime compensation in violation of the FLSA. The employer contended that it did not owe the women overtime pay because the administrative exemption applied.

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Back in January, the U.S. Department of Labor published its annual report detailing the accomplishments of its Wage and Hour Division. The “WHD by the Numbers 2023” report revealed several key things. One was the cost of employers’ failure to comply with the Fair Labor Standards Act. In 2023 alone, employers paid out more than $151 million to the WHD due to overtime and minimum wage violations. This should tell readers that FLSA non-compliance can be a substantial – and often unnecessary – drain on a business’s revenues. To ensure your business is fully compliant with all the FLSA’s demands, be sure you’ve consulted an experienced Atlanta wage and hour lawyer.

Overtime and minimum wage compensation are areas where misclassification often plays a major role. Overtime non-compliance can arise from misclassifying an employee as an independent contractor or misclassifying a non-exempt employee as an exempt employee. Misclassification-related minimum wage violations often are the result of erroneously classifying an employee as an independent contractor.

The report highlighted some other noteworthy information, including:

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Yesterday, the U.S. Department of Labor announced the publication of a new regulation governing the salary minimums applicable to certain exemptions under the Fair Labor Standards Act; namely, the executive, administrative, professional, outside sales, [or] computer employee” (a/k/a “EAP”) exemption and the highly compensated employee (HCE) exemption. According to DOL estimates, the new rule is a major departure from the previous rule, potentially moving as many as four million employees from exempt to non-exempt status. This change may significantly benefit those workers who become non-exempt. It also represents a critical decision-making juncture for employers. To ensure your business remains compliant with the FLSA in the face of the changing exempt-versus-non-exempt landscape, consult a knowledgeable Atlanta wage and hour lawyer.

The new rule is the result of a months-long rulemaking process. Last September, the DOL published a proposed version of the regulation. The proposed rule called for increasing the minimum salary level for qualifying as an exempt EAP employee to $1,059 per week (or $55,068 annually.) The department chose that figure because it represented “the 35th percentile of weekly earnings of full-time salaried workers in the lowest-wage Census Region.” (By the way, that lowest region is here in the South.)

The proposed rule also called for raising the minimum salary for qualifying under the HCE exemption to $143,988 annually. That figure was equal to the “annualized weekly earnings of the 85th percentile of full-time salaried workers nationally.”

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Whether you are an employer or a worker, employee-versus-nonemployee classification for purposes of employment law is a vital step, and the extreme importance of this classification process is something where you definitely should consult a knowledgeable Atlanta wage and hour lawyer. As a worker, misclassification may improperly deny you access to many statutory rights, including those guaranteed by the Fair Labor Status Act. As an employer, misclassification can inflict its own potential harm, including legal liability and an obligation to pay substantial court-ordered compensation to the worker(s) who sued your business.

Often, misclassification disputes involve deciding whether a worker is an employee or an independent (1099) contractor. As an FLSA case that recently came before the 11th Circuit Court of Appeals illustrates, that’s not the only way that misclassification can occur, and any classification that improperly fails to designate a worker as an employee can have serious negative consequences.

The plaintiffs performed services at a public golf club in South Florida. These roles included course rangers, cart attendants, driving range attendants, and bag drop attendants. The county specifically listed the positions as “volunteer” roles. They received no wages but were allowed to accept tips. As a perk, volunteers performing these tasks were entitled to “reduced fees to play and practice golf.” Specifically, volunteers who worked at least one seven-hour shift each week were entitled to “unlimited” rounds of golf at a steep discount ($5 per round instead of the standard $96 per round.)

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A recent minimum wage case from Massachusetts is a reminder that just because an employee is not actively engaged in conducting the employer’s business — or maybe even is asleep — that doesn’t mean those hours aren’t compensable time. Hours spent on-call or waiting to work may or may not be compensable time under the Fair Labor Standards Act. The analysis depends on the totality of the circumstances and, as the courts have put it, were the employees “engaged to wait” or waiting to be engaged? Whether or not you’re an employer or an employee, understanding what time is compensable (and what isn’t) is crucial. An experienced Atlanta wage and hour lawyer can help you make those assessments and take the appropriate next steps.

The case from the Massachusetts federal court involved long-haul truck drivers. Federal regulations demand that truck drivers spend 10 hours of every 24 off duty, but other regulations say that employers when determining compensation, can deduct a maximum of eight hours of every 24 as a sleeping period. The drivers’ minimum wage lawsuit contended that they should be entitled to compensation for 16 hours, not 14.

The court sided with the employees. Given that the drivers spent the hours in dispute in a moving semi-truck (a confined space “that is ill-equipped for many activities,” “containing only some basic living essentials,” and that drivers cannot leave until the truck stops moving,) the court concluded that the time was not truly the drivers’ own but instead spent predominantly for the benefit of the employer, making it compensable.

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Domestic workers (like nannies and housekeepers) are a diverse group. Even fictional depictions range from Julie Andrews’ Mary Poppins to Robin Williams’ Mrs. Doubtfire. In real life, these workers often put in long hours, working more than 40 hours a week. Those facts may mean that a nanny or housekeeper may be entitled to substantial overtime compensation if they qualify as a non-exempt employee. If you have questions about the Fair Labor Standards Act’s overtime requirement or the domestic service exemption, consult an experienced Atlanta wage and hour lawyer.

A South Florida nanny’s recent unpaid overtime case clarified the breadth/narrowness of the domestic service exemption in federal cases in Georgia and two surrounding states.

The worker began as a full-time nanny and housekeeper for two South Florida parents in 2019. The nanny worked overnight shifts for five consecutive nights, totaling 79 hours per week. The parents paid the nanny a flat rate of between $800 and $880 weekly.

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