FLSA Rewinds the Time Clock

FLSA pressures are bringing back the time clock, and some workers are more than a little ticked off.

It’s baaaack!

No, not some undead spirit from a horror movie, but something just as upsetting to some workers … the old-fashioned, punch-in and punch-out time clock.

Time clocks never really left industrial workplaces, but that’s not been the case in white-collar settings. There, many workers record their own attendance on paper time cards or time sheets, operating largely on the honor system. Under such systems, it’s common to see workers record a steady stream of “9-5”, “9-5”, “9-5”, even though it’s likely few arrive and leave at precisely those hours, day after day.

What’s changed things is the new emphasis the Department of Labor and plaintiff attorney community have put on making sure overtime is properly paid under the Fair Labor Standards Act (FLSA). Alleged FLSA violations are now the number one form of class action employment lawsuits. As a result, employers are increasingly looking for more precise means of tracking worker time.

Like many other technologies, the “old-fashioned time clock” is no longer so oldfashioned. These days, employees don’t punch in and out as much as they let their fingers–or rather their fingerprints–do the clocking, by passing them over a scanner. The idea is to defeat the old “buddy system,” in which one employee clocks in for another.

Clocks Not Just for Nonexempts Anymore

The FLSA is the big issue with nonexempts, but, says The Wall Street Journal, attendance and tardiness by exempt workers is also being scrutinized, in the name of greater efficiency. It’s not about money, since exempts must generally be paid their full salaries under the FLSA, regardless of hours worked. Instead, it’s about issues like long lunches or extended breaks. “Everybody wants … long lunch information on their salary people,” says Brent Larsen, of the attendance-tracking company, Count Me In, LLC. “They don’t use it for payroll, but to chew [workers] out.”

The return of the time clock has met with resistance. Workplace rights groups complain that fingerprint tracking invades privacy and that time tracking in general has little to do with effective performance. “Being chained to your desk is only one measure of productivity,” says privacy rights expert Pam Dixon. Her preference: a workplace that “fosters creativity and flexibility.”

Employers that use the systems defend them. “I probably save 10-15 minutes a day per employee, by preventing workers from padding their time sheets by staying late or unnecessarily starting early,” says Doug Leighner, a manager at an Illinois credit union.

If you do consider an automated timekeeping system, the experts have a few pointers:

–Give advance warning of the change and make employees understand why it’s needed.

–Work with vendors who can adapt their software to meet your needs.

–Require multiple levels of management to sign off on any overtime.

–Discipline for any unauthorized overtime, and keep records of your actions. Should there be later claims that a worker was not paid for “off the clock” work, you can then show that you not only did not order such work, but you actively discouraged it, even though you still paid the employee for the time worked.

Should every business have its employees punch a time clock? Or is the ‘‘honor system” the way to go? Use the Share Your Comments button and let us know your thoughts.

  • Riles Jr.

    Hello. We have an active full-time employee who works on our night shift from 5p to 2a. This person is a salaried exempt employee earning around $24/hour.

    They would like to take on an additional shift at our company – working 4 hours per day in our warehouse. We realize we would have to pay them time and a half for this role. This position would be non-exempt.

    My question is how do we go about structuring this persons pay? A day shift warehouse worker earns $16.50/hr. Can we pay this person an hourly rate of $8.25/hr which, with time and a half, would work out to the same rate as a current warehouse worker?

    What is the best way to handle this situation while remaining in compliance with FLSA rules and regs?

    Thanks in advance for your help.

  • Rhonda Knapp

    At our organization it would be wonderful if all employees had to punch a clock. There are multiple times when we are figuring paychecks that it seems like our salaried employees are getting paid their full pay but have only shown up for work a portion of the time. This leads to resentment with our hourly wage workers who do punch a clock. They feel that if they have to show that they were here putting in their time then the salaried workers should too. The honor system is a nice concept in a perfect world but anymore it seems that if an employee can fudge on their hours to get more pay they are going to. That seems like a harsh statement but anymore it seems that it is the norm.

  • jschleifer

    Editor’s Note: Mr. Reilly, here’s the answer to your question above, from the BLR Editors:

    “Exempt salaried employees often want to work additional hours for their employer doing nonexempt work (such as data entry) to augment their salary. If this work is paid on an hourly basis, the employee may no longer be exempt, and overtime will be owed, including overtime for hours over 40 per week that the employee works in his or her formerly exempt job.

    “This problem can be avoided by paying the employee a fixed salary for the second job that does not vary from week to week based on the number of hours worked. In addition, the hours worked in the second job must not be so large that the employee’s ‘primary duty’ no longer qualifies for the professional, administrative, or executive exemptions.”

    We’re happy to answer Mr. Reilly’s question but we do want to note that normally, answers to individualized questions are a part of the service at our excellent subscriber website, HR.BLR.com, which provides those answers within one business day. We encourage you to try the site FREE for 14 days at http://www.hr.blr.com. It’s really amazing in how it meets virtually all your HR needs.

    Regarding the above answer, this communication is designed to provide general information regarding the subject matter covered. It does not constitute legal advice. If legal advice or other expert assistance is required, the services of a competent legal professional should be sought.

  • Anonymous

    Forcing employees to punch in & out on a clock is very degrading, unless the manager and/or upper management do the same.

    If a company hires an employee full-time, every employee should be a salaried employee.

    Managers who worry if employees are a few minutes under are over will never get 100% support from their employees .

    If managers treat their employees like human beings, the employees will always work hard for that manager.

    Punching in & out is a negative in today’s work place and should be done away with.

    If companies want to be more efficient and streamlined, they should do away with hourly workers and make all workers salaried employees.

    They also need to changeover from candles to electricity (I wonder if companies will  understand this)?