Millions of exempt employees will need to be reclassified to non-exempt by December 1, 2016 for FLSA change compliance. This will cause necessary changes in processes for both the employer and affected employee(s). This will undoubtedly be a difficult transitions and should be monitored closely.
Some changes are:
– Employers will need to account for newly non-exempt employees work time.
– Previously exempt employees will need to begin to track their hours worked.
Employers must be prepared to update policies and processes related to time tracking for employees and managers, and have time for training before the compliance deadline.
Simply because there is a formal change in the employees’ classifications to non-exempt, it doesn’t mean that they will stop thinking or behaving like exempt employees. These employees will need to adjust to the non-exempt employee wage and hour requirements, such as clocking in and out and not working outside of their schedule.
To implement this change, employers should take proactive steps to consider how their technology infrastructure can assist with ensuring FLSA compliance. Consider the ability to leverage existing or new low-cost technologies to assist in maintaining wage and hour compliance.
Technology areas to consider to assist in avoiding unplanned overtime:
– Does Time and Labor Management technology enable “off-the-clock” work? Is there a way to restrict it?
– Does it allow “remote/mobile” access? Can this access be controlled?
– Does it have the ability to ensure employees are not working over 40 hours in one workweek?
Here are three ways to use technology to assist with policy changes and protect the company from potential wage and hour claims:
1. Remote Access Restrictions-If non-exempt employees have remote access to company resources through a virtual private network (VPN) or other similar solutions, extra caution should be implemented. Consider creating a security group (based on the non-exempt employees IP address) and a rule prohibiting those in the group from accessing company resources and networks outside employer-defined time periods.
2. Time Keeping Software Configuration-Because the FLSA changes will affect employees who may have been compensated as exempt for several years, new tracking and reporting software or configuration changes to your current software could be required. Through the process of developing new policies you can use technology to put the practices in place. For example, OnePointHCM’s overtime request module can be utilized which is a tracking mechanism to capture the employee’s request for overtime as well as the manager’s approval of that overtime. Reports can be run to compare approved overtime with actual overtime worked.
3. Electronic Disclaimers and Notifications-Utilize your time keeping technology to include an attestation clause which employees and managers must acknowledge and sign prior to submitting time cards. The attestation clause should state the all time, including hours outside of the employee’s normally scheduled workweek, overtime, etc. has been submitted by the employee.
Keep in mind that no matter what policies and practices you put in place to prohibit unapproved overtime and work outside of the employee’s normally scheduled work shift, ALL time must be recorded and the employee must be compensated for that time. An employer’s only recourse when an employee continues to violate the overtime policy is to take disciplinary action (up to and including termination); however compensation for ALL time worked MUST be paid. Failure to compensate the employee would violate federal wage and hour laws (as well as most state laws) and therefore present what could be a substantial wage and hour claim liability.
*Contact your OnePointHCM CSR or Time and Labor Management implementations specialist to discuss additional ways to leverage the OnePointHCM system to assist in these areas.