Benefits & Compensation News

This should never be in an employee handbook

Be careful what you write in employee handbooks. Seemingly innocent mistakes or careless wording can create major liabilities.

One statement that should never be in a handbook is “authorized overtime
is paid at 1.5 the hourly rate.”

Legally, that’s the same as saying “Our organization violates FLSA.”

Under FLSA, if a non-exempt employee works overtime – whether authorized or not – you must pay the overtime rate. What is legal is to head off unwanted OT before it happens.

It’s fine to say, “All overtime must be authorized by your supervisor.”

Next, describe the authorization process, and the disciplinary steps (if any) for breaking the rules.

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  • Tom

    Just another example of how lawyers write laws that create work for other lawyers.

  • mike R

    To Bill:

    “One statement that should never be in a handbook is “authorized overtime
    is paid at 1.5 the hourly rate.”

    Legally, that’s the same as saying “Our organization violates FLSA.””

    I disagree. They did not say “ONLY authorized overtime is paid at the 1.5 the hourly rate” or “unauthorized overtime will NOT be paid at the 1.5 the hourly rate.” Nothing in the statement says the “Organization violates FLSA.” As long as payroll is paying the OT according to the FLSA, the statement in the handbook should be fine.

    It does not make any business sense to communicate to employees “IF you work unscheduled and unapproved hours we will pay you anyway (even though we will).” With potential layoffs and marginal employees who feel they are about to lose their jobs, you don’t want to highlight for them the option to work unauthorized overtime prior to getting canned to tide them over until their unemployment checks start.

  • http://www.swktech.com Kathleen Weiss

    I agree with Mike.

  • http://www.epitometraining.com Brenetia Adams-Robinson

    The article is only suggesting that if you want to avoid the POTENTIAL for litigation that you should be very cautious of the wording in your employee handbook or on any other published documentation. What you say can be taken literally in a court of law. Thus, to assure a strong legal defense, organizations should take every measure to state things carefully. If one wants to emphasize the approval issue, simply state that “overtime must be approved in advance. Violation of this directive will result in disciplinary action”. Simple wording… protects everyone. As an HR manager who has dealt with various litigious issues, this advice is very timely and should be heeded for the protection of the organization.

  • Kristen

    What about state specific laws such as double time at 12 hours for non exempts? Being this specific with your statements will get you into trouble. And if you are looking at it from a plaintiffs attorney’s standpoint, the statement in the handbook could be interpreted as a willful violation of the FLSA.