How Do I Compensate a Problem Employee? - IE3: Indoor Environment & Energy Efficiency

How Do I Compensate a Problem Employee?

Question: I have an installer that shows up to the shop every day at 6:30 AM, loads his company issued truck for the job that day, he says he does not take a lunch and leaves the job at 2:30 PM. He then comes back to the shop and discusses what happened that day and also hands in any metal fab/material sheets into the shop area. When he was hired I told him I pay for the hours spent on the job only, no travel time or load time. He wants to be paid from 6:30 till he leaves the shop at the end of the day. Am I required to pay him for that time? If yes, is it considered overtime even though he was not on the job site?

Answer: The Fair Labor Standards Act (FLSA) requires employers to pay employees who are not otherwise exempt at least the federal minimum wage and overtime pay for all hours worked over 40 in a workweek. Under the FLSA, the Department of Labor (DOL) has relegated technicians, such as your employee to the non-exempt category, and as such they are eligible for overtime. FLSA-covered employees must be paid for all hours in the workweek. In general, compensable hours worked include all time an employee is on duty or at a prescribed place of work and any time that an employee is permitted to work. This generally would include work performed at home, travel time, waiting time, training, and probationary periods.

The general rule adopted by the Wage and Hour Division of the DOL is that travel time between jobs is compensable, but travel from home to the job site, or from the job site home, is not. However, the government agency has also issued an opinion letter that indicates that employees who are required to take company vehicles home must be compensated for the time going to and from home. Employees who choose voluntarily to use company vehicles, however, are not entitled to this type of compensation. Another test used by the courts and DOL in interpreting an employer’s obligations under the FLSA for payment of travel time is whether it is for the benefit of the employer, and in those cases the courts have stated that employers must pay employees for that time spent to and from a job site.

In your situation you have stated that you will not pay for either travel time or load time, but only for time spent on the job. If your employee is using a company vehicle that you require him to take home in the evenings, the DOL has said that this is compensable, as is the time he spends driving between jobs. Additionally, there are no exceptions to payment of time spent by this employee off-loading materials, and if this time causes his hours to exceed 40 in a workweek, then he must be compensated for any overtime worked.

However, as an employer you can certainly cite him for disciplinary problems if, even after being warned, he wastes time back at your facility and exceeds his 40 hour allotted workweek when he could easily finish his job without clocking any overtime. You would also need to notify him that any overtime work must be approved by his employer in advance (as well as require him to take and account for a lunch hour.) But remember, if he does work any overtime hours, you cannot withhold this pay and he must be paid accordingly. Be careful that your policies regarding your hours are conducted evenly with the rest of your employees. You need to have uniform hours for all, and make sure that management enforces them across the board.

DISCLAIMER
This response is intended for general informational purposes only and should not be construed as legal advice or a legal opinion, nor is this column a substitute for formal legal assistance. For help with particular legal needs, members are invited to consult with ACCA’s LegalTools Counsel, Brooke Duncan III of Adams and Reese LLP. Mr. Duncan can be reached at 504-585-0220 or by email at brooke.duncan@arlaw.com.

Hilary Atkins

Hilary Atkins

Hilary Atkins is ACCA General Counsel & Senior Vice President for Finance & Administration.
Hilary Atkins

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