Off-the-clock work is a big problem for employers. Whether it is supervisors encouraging employees to work through breaks or employees who take things home to work on after hours, off-the-clock work can become costly for a company if an employee decides to seek back pay. Employees need to be paid for all hours worked. In addition, they need to be paid overtime in accordance with the law, so you could end up with even bigger problems if supervisors are encouraging employees to work off-the-clock to avoid overtime. Here are some suggestions for minimizing your risk when it comes to off-the-clock work.
Non-Exempt workers & unpaid time
Non-exempt employees must receive pay for all hours worked. It’s that simple. Failure to do so could result in you paying back wages as well as penalties. Unpaid time by non-exempt employees can occur when an employee clocks out to avoid working overtime hours and then heads back to their desk to finish up a few things. It can also be time spent working during a meal break or time answering email in the morning before clocking in.
In my HR experience, non-exempt managers are often the ones most likely to work off-the-clock. The job of a manager is very demanding. They are often trying to maximize productivity while keeping labor costs down and reducing overtime. With the manager typically being the highest paid in the department, they may be tempted to take things home and finish work up after clocking out for the day in order to avoid costly overtime. This may seem well-intentioned because the managers want to save their departments a few dollars, but it would be a violation of the law not to pay them for the extra time worked.
Of course, there is also the problem of managers who encourage off-the-clock work. These are the managers who have no problem interrupting an employee’s unpaid meal break to tell them they are needed on the floor. There are also the managers who require employees to clock out before doing side work—a practice that seems especially common in the restaurant industry. The fact is, encouraging this kind of unpaid work can ended up costing a fortune. As I have said already, all hours worked must be paid.
The problem with technology
Technology has allowed us the ability to work from anywhere. We can respond to email by phone, text a quick answer to an employee needing guidance on a project or use the VPN to access all our files from home. I have had HR jobs that involved traveling to multiple sites, and technology made it possible for me to set up a workstation wherever I was. All I needed was my laptop, cell phone and an Internet connection.
This is great for exempt employees; however, it can be an off-the-clock nightmare for your non-exempt staff. That time your non-exempt employee spends responding to email while sitting on their couch at night needs to be paid. As technology allows for more and more possibilities for working from anywhere, employers need to be especially vigilant about all the resulting off-the-clock work. Consider working with your IT department to limit access to email and your network for non-exempt employees, so they are unable to log in after hours.
Stopping off-the-clock work
Now you know the risks of off-the-clock work, but how do you stop it? Have a clear policy in your handbook that states that you prohibit off-the-clock work. All hours worked need to be recorded using your timekeeping system. Reinforce this by training managers on the policy, and also remind them that tampering with an employee’s timecard is also wrong. Ensure that they understand that encouraging employees to work off-the-clock could result in disciplinary action or termination.
You will also want to make sure that employees understand that off-the-clock work is not allowed. Maintain an open-door environment, so employees feel safe coming forward to report a manager who encourages off-the-clock work. When an employee reports that they were unpaid for hours worked, remedy the situation as quickly as possible to ensure that they receive the pay they are owed.
Some employers may be tempted to make employees exempt in order to avoid the off-the-clock problem. Be careful with this approach and only make an employee exempt if they fit within the legal requirements for such classification. If the only reason you classify someone as exempt is to get out of paying them overtime, you may be misclassifying them.
Keep an eye out for employees (especially non-exempt managers) who seem to get an impossible amount of work done. These folks may be able to do that much because they take things home after they clock out. Address the issues that are making the employee feel like they have to do work off-the-clock. Whether it is providing some time management training or extra help, find ways to make sure the employee knows off-the-clock work is not part of their job.