Help Wanted: On hook for paying overtime

DEAR CARRIE: We are a small office and employ mainly hourly people. We have told everyone that we don't want people working overtime because we cannot afford it. Our problem is that we have one employee who stays an extra half-hour here and there and winds up working more than 40 hours a week. Her hours are 8:30 a.m. to 4:30 p.m. But she often stays until 5 p.m. We have other staff who are designated to work 9 to 5 so that the office can stay open.

Despite this, the problem employee stays late even when the office manager has told her to go home after her eight-hour day is over. What are our responsibilities regarding her salary? Do we have to pay her for the extra hours, and if so, do we have to pay her time-and-a-half when she exceeds the 40-hour limit?

On another subject: If we get a time clock and a person forgets to clock in or clock out on a particular day, what hours are we obligated to pay? Right now, everyone writes their hours down. Unfortunately, some of the staff take advantage and are not honest when they write down their hours at the end of the week. -- Managing Problems

DEAR MANAGING: If she works, then you're on the hook for paying her since she is hourly.

"This employee is being allowed to work, and she must be paid for it," said Irv Miljoner, who heads the U.S. Labor Department's Long Island office.

"Further, if that work puts her over 40 hours for the workweek, as an hourly paid, nonexempt worker, she must be paid overtime premiums at the rate of time-and-a-half her regular rate of pay for each hour over 40 in the week."

He noted that the statutory definition of the term "employ" includes "to suffer or permit to work." And all that time for hourly employees is considered compensable. But you don't have to pay them for a genuine meal break, that is one that doesn't require them to do any work.

It's worth noting that staying "late here and there" isn't going to put her over the all-important 40-hour mark, assuming she has an unpaid hour for lunch. Even if she built in an extra half-hour every day, her payable, or compensable, hours would total 37½ for the week. Even if she had just a half-hour for lunch and occasionally worked an extra half-hour, she still wouldn't exceed 40 hours. So maybe she is building in more extra time than you noted.

Here are my suggestions: If she doesn't have an hour for lunch, you might want to consider upping that time. And if she works more than her scheduled time, give her a later start the following day to even things out. If the workload is a problem, then consider adjustments.

Also consider writing the overtime issue into your handbook. Tell workers the difficulty it puts you in both financially and legally and inform them that violators will be subject to warnings and a possible dismissal. Even avid workers shouldn't cost their company unnecessary money or put them at risk for Labor Department audits and fines.

On the time clock issue, even if a person forgets to clock in or out on a particular day, the actual hours worked still must be paid, if the matter involves hourly employees.

"The bottom line is that company management has the responsibility to control the amount of hours being worked by the employees, [and to] direct and ensure that they are being recorded accurately on a daily basis, and to pay everyone for all hours worked," Miljoner said.

You should also include this issue in your handbook.

Click here to read more on what constitutes "hours worked," at www.dol.gov/whd/regs/compliance/whdfs22.pdf. For more on overtime, Click here to go to www.dol.gov/whd/regs/compliance/whdfs23.pdf.