Overtime, Minimum Wage, Unpaid Commissions and other “Wage Theft” claims.
Each one of these claims has different components and variables so we will discuss each one separately.
Let’s start with the most common one- overtime.
THE BASICS OF AN OVERTIME CLAIM
The most common principle of law known to most employees is the general statement that if an “employee works over forty (40) hours a week for a covered employer, they are entitled to be paid time and one half or overtime for any hours worked over forty.”
HEAR WHY WE FIGHT FOR EVERY EMPLOYEES RIGHT TO WAGES
So why do things always get so complicated?
That’s because if you take a closer look at the words in bold above, there are different factors that need to be addressed so that employees know whether they are entitled to overtime pay. CLICK HERE TO FIND OUT COMMON MISTAKES EMPLOYEES MAKE REGARDING OVERTIME.
“COVERED EMPLOYER”
For starters, the overtime laws only apply to “covered employers.”
What this means in general terms, is that for an employer to be legally obligated to pay overtime under the Fair Labor Standards Act (“FLSA”), the employer must have two or more employees and have gross revenues of $500,000 per year (note that I said revenue, not profit).
Or, if the employer does not make that $500,000 per year revenue threshold, an employee may still be entitled to overtime if that employee is regularly involved in interstate (across states) transactions, such as regularly dealing with customers or vendors in other states, processing credit cards or payments for customers in other states, or travelling to and from other states as part of their job duties.
These tests can get a little technical from a legal standpoint with all sorts of legal jargon, but the point of this is to give you a basic understanding of the law, rather than try to impress you with our knowledge and understanding of terms like “continuity of interstate commerce.”
WHAT DOES THE FEDERAL OVERTIME LAW SAYS ABOUT WORKING OVER 40 HOURS
Many clients ask us how they are supposed to know whether their employer is covered.
Of course, unless the employee has access to the books and records of the business, they cannot state for certain.
But, here is what we always tell our clients to do to help us both estimate- figure out how many employees work for the company at any time, and multiply what you (the potential client) makes per hour by the number of employees.
Then multiply that number by 40 hours per week and then again by 52 weeks a year.
If that payroll number is close to $500,000 (because we have not included over head costs such as equipment, office space, insurance, etc.), we generally have a good understanding that the employer is “covered.”
So, for example, let’s say there are 25 employees just like you making $12 per hour (totaling $300 per hour) X 40 hours per week (totaling $12,000 per week) X 52 weeks a year (totaling $624,000 just in labor costs) per year, it is pretty likely the employer is covered. Be your own math sleuth on this.
You have more information up front than the lawyer you are speaking to, and this type of information helps us evaluate your case.
“ONLY EMPLOYEES GET OVERTIME”
Step 2 (assuming that the employer is “covered”)- The FLSA only applies to “employees.”
Therefore, if you are a true independent contractor, the overtime laws do not apply to you.
Now, here is a trick that employers use to steal wages – they call you an “independent contractor” and give you a 1099, but the reality of the relationship, is that you are an employee. Important Lesson- Labels mean nothing under the law.
Generally speaking, a true “independent contractor” is someone who: (a) has their own company or is incorporated; (b) works for whomever whenever (not just the employer at issue); (c) provides their own tools and materials to do the job; (d) controls the work they do (rather than being restricted by the employer’s policies); (e) can turn down work for the employer without consequence; and (e) is truly in a separate business for him/her self.
Example 1 If you go to the same office or work site everyday, for the same employer, and the employer provides you with the materials or tools (office, computer, stapler) to do your job, and on top of that the employer tells you what to do, and how to do it, you are an employee. It doesn’t matter if they call you an “independent contractor.”
This is true even if you signed an independent contractor agreement. You are entitled to overtime (and possibly repayment of some taxes that you overpaid by being mislabeled).
Example 2 – You provide your own tools and materials to do a job. You work for different clients during the week or month at your choosing. You are incorporated or own your own business. You can hire your own staff to do the job for a client. You don’t have a set schedule with a particular client. You determine how the work is going to be done under your own standards. You invoice the client for your work.
In this situation, you most likely are properly labeled as an independent contractor, and you are not entitled to overtime.
HEAR HOW WE INVESTIGATE CLAIMS FOR OUR CLIENTS
“HOURS WORKED” If you work for a “covered employer” and you are an “employee,” the rule states you are entitled to be paid for your “hours worked.”
In general terms, here is what this means – If your employer knows, or should know that you are performing tasks (whether at home, in the field, or in the office) for the benefit of the company, that is working time and it counts toward your “hours worked” during the week.
Obviously, the easiest time to count is the hours you are “on the clock” or in the office doing work with everyone else. The trickier part, and where employers try to steal time, are the following examples:
Drive Time – This is the basic rule. Travel from your home to the job site generally is not covered. Once you arrive at the job site and the work day begins (discussed below), any travel during the day to and from customers counts as “hours worked.”
Many employers try to punch out or exclude this time during the workday. That is illegal.
Again, the rule of thumb is that if you are travelling for the benefit of your employer or one of the employer’s customers or clients during the work day, that has to be counted.End of the day drive time is another way employers try to steal your time.
Again, here is the basic rule on this – If your employer requires you to travel back to the office or shop at the end of the day, whether it be to drop off paperwork, tools, clean the truck, etc., that drive time is “hours worked” and you must be paid for that time (including the time you are working back at the office or shop) until you are done with all work related tasks, and you punch out to drive home.
But, if you can simply drive home from the work site without having to stop at your employer’s office or shop, that drive time, no matter how long, is not considered “hours worked” and does not count toward your overtime hours.
“Off the Clock Work” – With the invention of modern devices such as smart phones, tablets, and the improvement of laptops and wireless technology, the traditional work space (the office) no longer exists.
The office has now become our homes, cars, hotel rooms, and work sites.
As employees, we are now connected to work 24/7. But guess what, your employers don’t want to pay you for the after hour work at your home, kid’s soccer game, etc.
So again, here is the basic rule – If you are doing work anywhere, and your employer knows or should know you are doing the work (late night emails copying a supervisor, phone calls on the company phone late at night with clients, etc.) you are entitled to be paid for that as “hours worked.”
Here are some common examples of how employers try to steal this time away from employees.
Pre or Post Shift Work/Meetings – Once you arrive at the job site or office, and actually start performing work (vs. drinking coffee and talking to your friends) such as loading up your truck, getting paperwork ready, starting up your computer, taking customer calls, or attending a meeting with your employer, that is counted as working time regardless of whether you are on the clock or not.
Often times, employers see their employees doing this type of work to benefit the business, but will not allow employees to punch in until a set time. This is illegal.
Likewise, at the end of the day, employers often will have employees punch out, and keep them at work while their computer are shutting down, paperwork is completed, tables and work stations are mopped or cleaned, or the after hours meeting.
All of these tasks count towards your hours worked, whether they take 15 minutes or hours. Nobody should have to work for free.
Lunch Deductions – Employers love to make an automatic 30 minute or 1 hour deduction every day under the assumption that the employee is eating lunch free and uninterrupted.
We all know many employees work through lunch, by eating at their desk and taking calls or emails, or driving to the next work site while eating a sandwich.
The general rule is this – If you do not get a minimum of 15 minutes of free, uninterrupted time (no phone calls, driving, or work related tasks), you are entitled to be paid for that time, and it is illegal for your employer to make a deduction for this time.
At 30 minutes a day, 5 days a week, that’s 2.5 hours of work (and likely overtime) that your employer is stealing from you. That’s illegal.
On Call/Wait Time – There are numerous legal challenges to decide whether someone should be compensated for on call or wait time.
Rather than bore you with the legal definitions and issues, I’ve boiled the basics of this rule down to the following: If you are required to wait, or be on call for the benefit of your employer, and you are not free to use the waiting/call time for your own personal benefit, that time is counted as hours worked.
So, here’s what I mean – If you are required to sit and wait for a delivery or a call, and you cannot leave the premises, or attend to personal business like another person who is not working, that time generally should be paid.
Common examples of restrictions that don’t allow the individual to be free (making the time “hours worked”) are when: (a) employers require you to call a customer or employee back within 10 minutes or less; (b) employers require that you be within 15 or so miles of the office in case of a call; (c) employers require you to check in hourly or otherwise to see if you are needed to work; or (d) you are given a company phone or computer, and are told that calls and emails must be handled as they arrive (i.e, an air conditioning repair company). For the most part, this is the type of time that is counted as “hours worked.” CLICK HERE TO FIND OUT THE MOST COMMON WAYS EMPLOYERS STEAL TIME AND PAY FROM THEIR EMPLOYEES.
LEARN WHY YOU DON”T HAVE TO PAY A DIME IN ATTORNEYS FEES WITH YOUR UNPAID WAGE CLAIM
THE MYTHS ABOUT OVERTIME
For years, employers have been feeding employees lies about their entitlement to overtime. The 5 most common ones are:
- “You are salaried so you don’t get overtime.” LIE. Here is the deal- there are some employees who, because they are salaried (at least $455 per week) AND because they perform certain duties (like being a manager or high ranking executive who can hire and fire, and/or make important business decisions for the company) are not entitled to overtime. But, if you are paid a salary and are doing manual labor, or not supervising anyone, or making important decisions on behalf of the company), you likely are entitled to overtime. Piece Rate, Day Rate, and many commissioned employees also are entitled to overtime- NO MATTER WHAT THEIR EMPLOYER SAYS.
- “Comp time is legal.” LIE. Unless you work for the government, “comp time.” is illegal. You must be paid overtime (anything over 40 hours) in every workweek. There is no such thing as “comp. time” and employers cannot combine weeks to avoid paying overtime. If you work 50 hours in one week and 30 hours in the next week, you still are entitled to 10 hours of overtime pay.
- “Only Overtime That is Approved is Payable” LIE- If your employer knows, or has reason to know you are working overtime, it must be paid whether approved or not. Employers know, or have reason to know, by looking at login times, noticing late night emails or calls, or just using common sense that the employee is working beyond normally scheduled hours.
- “Salespeople don’t get overtime.” LIE- Here’s the easy rule, if your commissions don’t exceed your base pay, you generally are entitled to overtime pay (except if you work at a car dealership – then you don’t get overtime).
- “Employees can waive overtime pay.” LIE- The Supreme Court says that even if you agree not to accept overtime or just get straight time pay for overtime hours, that agreement is unenforceable as a matter of law. So, don’t let your employer tell you that you guys can agree not to be paid overtime. It’s wrong.
LISTEN TO A QUICK STORY ABOUT A COMMON EMPLOYER TRICK TO AVOID PAYING COMMISSIONS
THE INDUSTRIES WITH THE MOST COMMON OVERTIME VIOLATIONS
Certain industry employers are more likely to violate the overtime laws than others. The most common ones we run into are as follows:
- RESTAURANT AND SERVICE INDUSTRY EMPLOYEES
- CONSTRUCTION WORKERS OR LABORERS
- HOME HEALTH CARE AIDES
- LIMOUSINE DRIVERS
- HOSPITAL EMPLOYEES
- MEDICAL SUPPORT STAFF
- IT HELP DESK EMPLOYEES
- SALESPEOPLE
- COMPUTER MAINTENANCE
- NETWORK REPAIR WORKERS
- BOOKKEEPERS
- JUNIOR ACCOUNTANTS
- PARALEGALS
- SECRETARIES
- ADMINISTRATIVE ASSISTANTS
SO I HAVE A CASE, WHAT AM I ENTITLED TO?
Well, we have made you read this much to see if you have a case under the overtime laws, we would expect that you would want to know what damages you are entitled to and whether it is worth pursuing your case. So, here is what the law allows:
- The law generally allows an employee to secure unpaid overtime wages 2 years from the date the employee files a lawsuit for them. In certain situations where we can show that the violation was knowing or purposeful (what the judges call “willful”), we can go back 3 years from the date we file the lawsuit. This is very important- UNLIKE MOST CLAIMS WHERE THE STATUTE OF LIMITATIONS DOES NOT RUN FOR YEARS, YOUR OVERTIME STATUTE OF LIMITATIONS RUNS UNTIL YOU FILE A LAWSUIT. THEREFORE, FOR EVERY DAY YOU WAIT TO FILE, THAT IS A DAY OF WAGES LOST THAT CANNOT BE RECOVERED. We tell you this not to push or rush you into litigation, but because it is a little known fact that costs employees millions of dollars a year as the clock ticks and ticks.
- If there is an overtime violation, the employee generally is not only entitled to their overtime damages for 2 or 3 years, but in most cases, double the actual damages owed.
- Your employer also is required to pay for your attorneys’ fees and costs. This is important, because the law wants employees to come forward no matter how big or small their case may be, because the attorneys can handle the case regardless of size, because they know that they will be properly compensated by the offending employer.
Example: Let’s say you made/make $10.00 per hour and worked 50 hours a week for 3 years with no overtime pay. Under this scenario, you would most likely be owed $15.00 per overtime hour ($10.00 X 1.5) X 10 overtime hours per week (50 hours a week is 10 overtime hours) for a total of $150.00 owed per week X 156 weeks= $23,400 X 2 (double or “liquidated damages” as the courts call them) = $46,800.00 plus the employer’s payment of your attorneys’ fees and costs incurred on your behalf by us or the law firm of your choice.
LISTEN AS I EXPLAIN HOW LIQUIDATED DAMAGES WORK AND WHY IT MATTERS TO YOU
The same damages are available on a minimum wage claim discussed below.
MINIMUM WAGE
Effective September 30, 2023, Florida’s minimum wage increased to $12 per hour for non-tipped employees, and $6.98 an hour for tipped employees after applying the maximum tip credit of $3.02. The federal minimum wage is $7.25 per hour.
Everyone knows that an employee must be paid the minimum wage for every hour worked, so long as the employer is “covered” as discussed above.
While minimum wage violations are pretty rare in the non-tipped work force (unless an employer fails to pay an employee his/her final paycheck or owed commissions which drop the total weekly compensation below minimum wage), they are very common in the restaurant and other service industry sectors regarding tipped employees. CLICK HERE FOR AN ARTICLE ON THE MOST COMMON WAYS EMPLOYERS STEAL WAGES FROM TIPPED EMPLOYEES.
HEAR ABOUT A VERY COMMON WAY TIPPED EMPLOYEES WAGES ARE ILLEGALLY DISTRIBUTED
COMMISSIONS AND OTHER “WAGE THEFT” CLAIMS
In our practice area, we see a very common violation where employers either fire an employee before their commissions and wages are due (common in real estate and other sales jobs) in an effort to avoid paying overtime.
In Florida, we have been successful in recovering hundreds of thousands of dollars for employees wronged by their employers in this regard.
What we generally do in this instance, is file a claim for breach of contract, and, because commissions are considered “wages” under Florida law, this generally means that the employer is required to pay our attorneys’ fees and costs if we prevail.
We may also file a claim for what is called “civil theft” which, if successful, may entitle the employee to three times the amount of wages wrongfully withheld.
You work hard for your wages. Your employer has no right to keep them, and we make sure they don’t.
Contact our Davie, Florida Overtime and Unpaid Wages Attorney Attorney at Celler, Legal, P.A. for a FREE consultation regarding your discrimination case.
WATCH THE FULL INTERVIEW WITH UNPAID WAGE ATTORNEY RICHARD CELLER HERE