Recent news items about recording employee work time have prompted me to republish this post from earlier this year. Try not to make these time recording mistakes.
In my consulting practice, I run across companies occasionally that are somewhat lackadaisical in keeping track of the time their employees are working. Often this comes from another error they are making that has them thinking that the exact time an employee works is not important. Nothing could be further from the truth.
Failed to pay for returning the truck
One company, based in California, was caught by the Wage and Hour Division of the USDOL not paying for the time it took workers to return a truck to the home base. I am sure the thought process was something akin to “They are in a truck not working so we don’t really owe them for just riding.” It is not hard to fathom such a mistake, after all, the travel time regulations are not exactly crystal clear. Regardless their thought process, they were incorrect and it cost them $62,672, paid to a dozen employees.
In a post called Five acts that violate the overtime provisions of the FLSA I wrote about several other mistakes employers make that could put them in violation of the FLSA. HR people are not immune to these mistakes. Just the other day, in a discussion group on Facebook, someone asked about the rules on rounding for payroll purposes. The answers varied. Not all were correct. According to USDOL, the rule is:
Some employers track employee hours worked in 15 minute increments, and the FLSA allows an employer to round employee time to the nearest quarter hour. However, an employer may violate the FLSA minimum wage and overtime pay requirements if the employer always rounds down. Employee time from 1 to 7 minutes may be rounded down, and thus not counted as hours worked, but employee time from 8 to 14 minutes must be rounded up and counted as a quarter hour of work time. See Regulations 29 CFR 785.48(b).
The best practice for dealing with the FLSA is to do your homework. Just blithely instituting a rule and going merrily along your way could end up being a very expensive lesson in wage and hour issues.