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Nine Steps To Reducing Your Wage & Hour Liability

Today, some tips to reduce your chances of being at the wrong end of a filing:

  1. Audit all positions classified as exempt from overtime;

  2. Re-write your job descriptions, even if they were last done within the last few years;

  3. Review your policies to determine whether steps can be taken to eliminate or substantially reduce the possibility that an employee can claim to have been working, including reviewing such things as “automatic deductions for lunch,” rounding, and similar practices.

  4. Analyze policies and procedures to review deductions from wages and salaries to ensure that they comply with the minimum wage and overtime requirements of state and federal law. These are the first steps toward minimizing liability.

Train Managers. Making sure managers understand the rules is paramount. Managers can avoid costly mistakes and spot problems before they become too costly.

Think Exempt – Non-Exempt, Not Just Salary – Hourly. Too many employers pay employees a salary and then believe that relieves them from any obligation to pay overtime. Employees need to make sure those employees are properly classified as exempt (someone who is typically not paid overtime) or non-exempt (someone that is generally entitled to overtime).

Take Complaints on Wage Issues Seriously. You want to treat wage and hour complaints just as seriously as employment issues including harassment or discrimination. In fact, these wage and hour lawsuits could be more costly to your business.

Do Not Retaliate. Never, never, never retaliate against someone that makes a complaint for wage and hour issues.

Develop strong policies on pay practices and employee hours. Make sure employees work those hours assigned and do not work off-the-clock. Above all, properly document the number of hours worked because just like in baseball where a tie goes to the runner – if the employer has not documented the hours worked by the employee – the benefit of the doubt will go to the employee.

Courtesy Rush on Business (we wish he was in California!), Elarbee Thompson,


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Dave Berkus is an accomplished speaker, author and angel investor.  He provides common sense advice to all businesses through his blog, Berkonomics. His recent post deals with the frustrations of busi

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