Giving an employee a fancy or creative title is one of many ways that employers try to skirt overtime laws. What they fail or refuse to understand, however, is that merely handing out a title does not negate an employer’s obligation to pay the employee overtime. This practice has recently caught the attention of several U.S. senators, who are investigating whether multiple companies are violating federal overtime requirements. Do you know your rights to overtime? We can help you protect them.
Several large employers under fire
Two dozen companies, including Pizza Hut, H&R Block, and Burger King are under investigation for potentially violating federal overtime law. The companies allegedly handed out the title of “manager” to employees performing non-managerial duties. This was apparently done in an effort to exploit part of a federal law that, under limited circumstances, allows employers to not have to pay their managers overtime. By doing this, the employers cheated their employees out of approximately $4 billion in overtime each year.
Senators Elizabeth Warren and Sherrod Brown announced the probe after a recently released report found a disturbing pattern of employers labeling their employees “managers” and paying them salaries, which (when done legally) allow them to evade traditional overtime requirements. Under federal law (the Fair Labor Standards Act, or FLSA) most hourly workers are entitled to time and a half pay for each hour worked over 40 in a week. Managers who earn a salary of at least $35,568 per year do not have to be paid overtime. However, they must actually be managers, which is where the problem arises.
What does it take to be a bona fide manager?
“Manager” is not simply a title to apply to an employee in an effort to circumvent overtime laws. It matters what the employee’s actual job responsibilities are. A manager, quite simply, must occupy a management position, which under the FLSA includes such job duties as:
- Interviewing, selecting, and training employees
- Setting and adjusting employees’ rates of pay and hours of work
- Directing the work of employees
- Maintaining production or sales records for use in supervision or control
- Appraising employees’ productivity and efficiency for the purpose of recommending promotions and other changes in employment status
- Handling employee complaints and grievances
- Disciplining employees
- Planning the work that employees are to do
- Determining the techniques to be used by employees in carrying out their duties
- Apportioning work among the employees
- Determining the type of materials, supplies, machinery, equipment, and/or tools to be used or merchandise to be bought, stocked, and sold by the employer
- Controlling the flow and distribution of materials, merchandise, and/or supplies
- Providing for the safety and security of the employees or the business property
- Planning and controlling the company budget
- Monitoring or implementing legal compliance measures
Therefore, it’s not enough to be paid a certain salary with a particular job title attached to it. If the employee is not responsible for managerial and or supervisory duties, there’s a good chance the title “manager” is only being used to get around overtime of other wage and hour laws.
Do You Know Your Right to Overtime?
Have you been given a questionable title such as manager, while still performing entry- or low-level job duties? Do you routinely work over 40 hours per week, but you’re paid a salary or told you don’t qualify for overtime? Our legal team stands up for the rights of workers who are denied the time and a half pay to which the law entitles them. Connect today with The Lore Law Firm by filling out our confidential client intake form.
