QUESTION: I manage the payroll for a company and I know that we are misclassifying employees (exempt vs. nonexempt; independent contractors vs. employees). I advised the owner, but he chose to leave it as is. Could I be held liable as the payroll administrator?
ANSWER: Under the Fair Labor Standards Act (FLSA) and certain state laws, individuals involved in making classification decisions can be personally liable for misclassifications. The FLSA defines “employer” broadly to include “any person acting directly or indirectly in the interest of an employer in relation to an employee.” Whether you could be held liable likely depends on your role in determining the classification and your role within the company.
QUESTION: One of our hourly employees ($17 per hour) arrives late way too often. We’d like her to get here on time, so we are considering cutting her hourly rate when she arrives late. For example, if she arrives an hour late, we would not pay her for the hour and cut her pay to minimum wage for the rest of the day. Can we do that?
ANSWER: First, you must only pay hourly employees for the time they actually work. If your employee arrives an hour late, you obviously don’t need to pay her for the hour she didn’t work.
Generally speaking, employers are free to prospectively change the wage rate of their at-will employees and may adjust those rates up or down. However, you should give advance notice in writing of this policy, and you should check your state wage payment laws to determine whether any state or local laws limit implementing this policy.
You should not cut her pay to minimum wage without giving her advance notice. You can, however, discipline her some other way for being late and then warn her that future tardiness may mean a wage cut.
MORE HUMAN RESOURCES QUESTIONS:
Uniform policies, and two-week notices
I-9 forms, and payroll debit cards
Can employee resign and then change her mind?
Human Resources Tips for Dental Practices is provided by Tim Twigg and Rebecca Crane of Bent Ericksen & Associates. Tim Twigg is president and Rebecca Crane is a human resource compliance consultant with Bent Ericksen & Associates. For 30 years, the company has been a leading authority in human resource and personnel issues, helping dentists deal successfully with the ever-changing and complex labor laws. To receive a complimentary copy of the company’s quarterly newsletter or to learn more about its services, call (800) 679-2760 or visit bentericksen.com.
