Fastenal has announced an agreement to settle a wage-hour lawsuit filed against it toward the end of 2007. Wage-hour law can be a tricky area for employers, as we reported in our premium content newsletter back in October when the lawsuit was filed. In light of Fastenal's settlement, it's probably worth revisiting that report.
One lawyer from the national employment law firm Fisher & Phillips told me at that time that it's not unusual to see legal problems arise from confusion over the exemption status of certain workers, as Fastenal has recently seen. So-called "white-collar" exemptions depend in part on what kind of work the employee is actually performing rather than whether the employee is well-paid or high skilled, he says, or whether the employee has a "high-sounding" job title or are in a position with an "impressive-looking" job description. The firm has an explanatory booklet on the wage-hour law at laborlawyers.com. The exemption rule also depends on how much the employee is paid – at least $455 a week. (Though salaried employees are not always exempt.)
Other sticky areas of the law, according to the law firm, include "off-the-clock" work, deductions or other offsets to legally required pay, failing to figure overtime properly, or failing to figure overtime on bonuses or other incentive amounts, and failing to take into account differences between federal and state wage-hour laws.
Fisher & Phillips recommended avoiding these common errors in complying with the Fair Labor Standards Act:
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Assuming that all employees paid a salary are not due overtime
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Improperly labeling an employee as exempt
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Failing to pay for all hours an employee works
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Limiting the number of hours employees are allowed to record
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Failing to include all pay required to be included in calculating the regular rate for overtime
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Failing to add all hours worked in separate establishments for the same employer when calculating overtime due
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Making improper deductions from wages that cut into the required minimum wage or overtime. Examples: damage, tools, and uniforms.
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Treating an employee as an independent contractor
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Confusing federal and state laws
