By Martin Morgan of CAI
Regulations regarding employee overtime pay and recordkeeping can be difficult for any employer to keep up with and understand. In North Carolina employers must comply with both the federal Fair Labor Standards Act (FLSA) and the N.C. Wage and Hour Act. The minimum wage, overtime and youth employment provisions of the N.C. Wage and Hour Act follow closely those of the FLSA.
There are many aspects of wage and hour compliance that can be tricky for employers. Here are five regulations that are among the more frequently violated:
1. For-profit companies cannot accept volunteers. The FLSA does not permit volunteers in for-profit private companies. Even though employees may be willing to volunteer their time, the FLSA considers work performed as a benefit to the employer and views this as an employment relationship.
2. A working lunch is compensable work time. If an employee is eating lunch at his or her desk and while eating makes business calls and conducts business, it is considered compensable work time.
3. Meetings and training time count as compensable work time. For a lecture, meeting or training to not count as compensable work time it must meet the following criteria: 1) outside normal work hours, 2) attendance is voluntary, 3) not job related, and 4) no work is performed.
4. Commission plans should address what happens when an employee quits or is terminated. If the agreement does not specify, an employee could receive commissions on sales indefinitely.
5. Overtime should be paid on the “regular rate” not the base hourly rate. Examples of pay that should be included in the regular rate are commissions, incentives, other non-discretionary bonuses and shift premiums.