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Dispelling the 10 Biggest Wage and Hour Myths – Part II

I’m happy to report (at least from the standpoint of my own safety) that I was unable to find any evidence last night of the existence of a Big Foot or Sasquatch roaming the neighborhoods of Orefield, Pennsylvania.  That said, let’s continue on with the second half of the biggest wage and hour myths.

  1. Job title dictates exempt status. NEVER!  Simply inserting the word “supervisor,” “executive,” or “manager” into an employee’s job title does not make the employee “exempt” from the overtime provisions of the FLSA (e.g.,  Assistant Manager, Shift Supervisor, Executive Assistant, Custodial Manager, Environmental Specialist).  In order to qualify for the FLSA’s executive exemption, the employee must meet all of the requirement for the exemption:  (1) guaranteed salary of at least $455 per week (the proposed changes to the salary threshold are currently on hold thanks to the United States District Court for the Eastern District of Texas); (2) primary duty is managing the employer or a customarily recognized department or subdivision of the employer; (3) the employee regularly supervises two or more full-time employees or their equivalent; and (4) the employee has the authority to hire/fire, or the employee’s recommendations in this regard are given particular weight by management.
  1. Subsequent to exhausting paid leave, the salary of an exempt employee can be docked when the employee comes in late or leaves early due to sickness or personal reasons. SORRY.  WRONG AGAIN.  An employer can never dock an exempt employee’s salary for partial day absences (unless the absence is FMLA-qualifying).  The only permissible deductions from an exempt employee’s salary are for:  (1) full day absences after the employee has exhausted all available paid leave; (2) infractions of safety rules of major significance; (3) disciplinary suspensions of one or more full days for violation of workplace conduct rules; (4) pro rata adjustments for the first and last week of employment; and (5) unpaid leave pursuant to the FMLA.  Consequently, if an exempt employee has exhausted all available paid leave, arrives to work at 8 am, and leaves work at 8:30 am because of sickness (that is not FMLA-qualifying), the employer cannot deduct any amount from the employee’s weekly salary because this was not a full day absence.
  1. Employees who perform work during their unpaid lunch do not have to be paid. NO! NO! NO!  In order for a lunch/meal break to be unpaid, the break must be 20 minutes or more and the employee must be “completely relieved” of all work during the break.  Any work performed by the employee during an “unpaid” lunch break transforms the break into a paid break.  This is true even if the employee performs the work “voluntarily” or “without authorization.”
  1. We require our employees to “clock out” for all breaks and therefore all breaks are unpaid. DO NOT PASS GO!  HEAD STRAIGHT TO JAIL.  According to FLSA regulations, only breaks of 20 minutes or more can be unpaid.  Consequently, any breaks of less than 20 minutes must be paid.  It does not matter if the employer has required the employee to “clock out” for the duration of the break.  If the break was for less than 20 minutes, the employee must be paid for the time (even though his or her time card indicates no work during that time period).
  1. An employer cannot unilaterally reduce an employee’s rate of pay. GAME OVER.  FEEL FREE TO TRY AGAIN!  Absent an employment agreement or some other contractual limitation, employers can unilaterally reduce an employee’s rate of pay.  There are no federal laws limiting this right.  Under Pennsylvania law, the only requirement is that the employer must give the employee advance notice at least one full pay period prior to the effective date of the change.  Obviously, a retroactive reduction in an employee’s pay rate is impermissible.  If, however, the employer informs the employee in advance (by at least one pay period), the employer is permitted to reduce the employee’s rate of pay (both hourly and salary).
  1. Employees who work more than 8 hours in a day are entitled to overtime. I know that I said 10, but I lied.  I couldn’t resist adding one more. An employee is not entitled to overtime compensation for working more than 8 hours in a day.  An employee can work 24 hours in a day and still not be entitled to overtime compensation.  In order to have an overtime entitlement, the employee must work more than 40 hours in a work week.

I hope you enjoyed my own special version of Myth Busters.  I’m off now to see whether I can find any Leprechauns for next Friday’s festivities!

For more information regarding wage and hour or any other labor and employment law matter, please do not hesitate to contact a member of our Labor and Employment Department.