HR Management & Compliance

The Wage-Hour Risks of an Electronic Leash


Many of our employees
carry company-issued cell phones, PDAs, and laptop computers. And,
unfortunately, some of our managers have made full use of this technology by
calling and e-mailing their subordinates at all hours of the day and even on
weekends. I’ve become concerned that we could have a wage and hour problem on
our hands because we’re not tracking the time employees spend outside of their
normal workdays on work-related calls, e-mail and the like, so we’re not paying
overtime. Could this be a problem?

– Anne in Southern California

Your instincts are on
target. Since the 1990s, as our culture has become accustomed

to cell phones, e-mail,
etc., new technology has made it easier than ever for employees to stay in touch
with the office and clients.


If the employee is
properly classified as an exempt manager, administrator, or professional, the
extra time spent outside of work hours doesn’t pose an overtime issue. But a
nonexempt employee who puts in 8 hours a day in the office, or 40 for the week,
and then goes home and has to answer e-mails from a boss or client on the
weekend, could have a legitimate overtime claim.


Generally, if an
employee is required or permitted to work, the employer must pay for that work
time. This is true even if the employee isn’t instructed, requested, or
authorized to put in the time as long as the employer knows or has reason to
know the employee is working. This work time must be paid for at an overtime
rate if it puts the employee over 8 hours in a day or 40 in a week.


However, if the time
spent is insubstantial or insignificant—what’s referred to as “de minimus”—the employer
probably doesn’t have to pay for it. Whether an employee’s time is de minimus
depends on several factors, including: whether it’s administratively difficult to
record the bits of time; whether the employee regularly puts in such time; and
the aggregate amount of the time. Generally, anything more than just a few minutes
a day won’t be de minimus. And as we all know, minutes spent on e-mail or cell
phone calls quickly add up.


So what can employers do
to avoid overtime liability stemming from being on an “electronic leash”? Here are
some suggestions:


1. Encourage managers
and employees to leave technology behind whenever possible, such as on vacations,
weekends, family gatherings, etc. Although this could require a real shift in
company culture, it will help limit your overtime liability.


2. Make sure you have an
overtime policy making it clear that employees must receive advance
authorization for overtime work or face discipline.


3. It is critical to
ensure that managers are on board with company policy so that they’re not
encouraging (or even tacitly requiring) employees to work overtime while
turning a blind eye to it. Make it clear that you will discipline managers who
permit or require employees to work “off the clock.”


4. Regardless of your
policy, you must pay for overtime worked. If you suspect a nonexempt employee
is putting in unauthorized time outside of work hours, pay for the time, but
also take steps to address the situation from a disciplinary standpoint (if
necessary) to ensure the employee doesn’t continue to work unauthorized overtime.


The HR Management & Compliance Report: How To Comply with California Wage & Hour Law, explains everything you need to know to stay in compliance with the state’s complex and ever-changing rules, laws, and regulations in this area. Coverage on bonuses, meal and rest breaks, overtime, alternative workweeks, final paychecks, and more.


Another point to
consider: Regardless of an employee’s exempt or nonexempt status, the ease of
working whenever and wherever and the workplace pressures to do so can make for
an unhealthy lifestyle. In fact, a recent Rutgers
University School of Business study concludes that information and
communication technology (ICT) can turn into an employee addiction. According
to a researcher, such addiction is “a kind of elephant in the room—everyone
sees it, but no one wants to acknowledge it directly. Owing to vested interests
of the employers and the ICT industry, signs of possible addiction—excess use
of ICT and related stress illnesses—are often ignored.”



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