It is well understood that employees misclassified as exempt under the FLSA are entitled to overtime pay for hours worked in excess of forty in a week. However, while the United States Department of Labor takes the position that any unpaid overtime is calculated using the “half-time” method, not all of the Circuit Courts have confirmed
Damages
Seventh Circuit Upholds Pro-Employer Method of Overtime Calculation for Misclassified Employees
The Fair Labor Standards Act requires employers to pay non-exempt employees one and one half times their regular rate of pay for any hours worked in a workweek in excess of 40. United States Department of Labor regulations, as set forth in 29 C.F.R. § 778.114(a), allow an employer to utilize the fluctuating workweek (“FWW”) method…
Court Denies Claim For Alleged Unpaid Overtime Despite Employer’s Failure To Maintain Required Records
As discussed here, an employer’s maintenance of accurate records of hours worked by employees is not only a substantive requirement of the FLSA, but an essential component to defending against “off the clock” claims. But what happens if an employee brings such a claim and the employer has not maintained records? Is the employer defenseless?…
The Price of Non-Compliance with the Fluctuating Workweek Method of Overtime Calculation
Under the FLSA (and most state laws), the fluctuating workweek method (FWW) of overtime payment allows employers to reduce overtime expense by paying “half time” for all overtime hours if the following four factors are satisfied: 1) employees’ hours fluctuate from week; (2) employees receive a fixed salary each week that does not vary with…
Federal Court in Michigan Applies Equitable Principles and Allows Offsets from Different Pay Periods
The FLSA, as we know, is structured largely on a “workweek basis.” See, e.g. Bright v. Houston Northwest Medical Center Survivor, Inc., 934 F.2d 671, 678 (5th Cir. 1991). The standalone nature of each workweek can have draconian results for employers who overpay (intentionally or otherwise) in some workweeks, but underpay in others, as…