A: Paying an employee a salary is not inherently legal or illegal. You can certainly pay someone a salary, but you need to ensure compliance with other rules and laws.
First, under the Federal Fair Labor Standards Act, there are two employee classifications, “exempt” and “non-exempt.” Second, about 95% of all dental staff land in the “non-exempt” category, meaning they are entitled to pay for the hours they actually work and must be paid overtime anytime the total hours exceed the “overtime trigger” under federal laws or under the laws of your state.
There are two common mistakes made by many dental practices: 1) thinking that overtime can be avoided or not paid when salary pay is provided. This is absolutely not true. It must always be paid to non-exempt employees, and, 2) thinking that salary pay will simplify your recordkeeping requirements. You still must track and account for all hours worked to meet recordkeeping and retention requirements for non-exempt employees.
Another consideration is that the term “salary” can have the affect of misleading your employees. A salary is often thought of as being guaranteed, even in times when an employee isn’t working. While this is mostly true for “exempt-level” employees, this isn’t the case for non-exempt employees.
Non-exempt level employees can have their salary reduced to account for hours not worked. However, since you are paying them a salary, this may cause problems if not addressed and understood upfront. Thus it is recommended that you clearly spell out in your employee policy manual how an employee’s wages will be affected in certain situations, such as when the office closed when doctor is away, or when an employee goes home early.
You must define how many hours per week the salary is based upon. This is usually determined by how much you are expecting the employees to work, but it cannot exceed 40 hours in a week. For example, you can pay your employees a salary of $50,000 per year to work 36 hours a week. However, if your non-exempt employees work 38 hours in any given week, that extra two hours must be accounted for on their paychecks even though overtime did not occur. This is because non-exempt employees must be paid for all hours worked and the salary is based on 36 hours, not 38.
As you can see, administratively, paying non-exempt employees a salary does not necessarily make things easier, nor does it guarantee an employee’s paychecks will be even and consistent. The salary may need adjusting regularly to reflect time off, extra hours worked without overtime, and/or extra hours with overtime. Thus in the long run it can be more hassle than it’s worth for the employer. Paying non-exempt employees an hourly wage removes confusion and keeps administrative headaches to a minimum.
QUESTION: What should we do if one of our team members gets a stick from an instrument that has just been used on a patient?
ANSWER: 1) Immediately flood the exposed area with water and clean any wound with soap and water, or skin disinfectant if available.
2) Send the employee to a professional for medical attention, and follow any requirements imposed by the medical professional to manage the wound and/or test for potential infections.
3) Complete workers’ compensation claim paperwork and submit to your carrier. This is an injury on the job and is required to be handled through your workers’ compensation insurance.
4) Follow up with the employee to ensure everything is okay and that no further action is required.
RECENT HUMAN RESOURCES QUESTIONS:
Blue nail polish, and 'working interviews'
Time allotted for breastfeeding; What is a 'protected class'?
What to do with staff who were caught red-handed?
This article first appeared in DE's Expert Tips & Tricks. To receive enlightening and helpful practice management articles in this e-newsletter twice a month, visit dentistryiq.com/subscribe.
Human Resources Questions for Dentists is provided by Tim Twigg and Rebecca Boartfield of Bent Ericksen & Associates. Tim Twigg is president and Rebecca Boartfield is a human resources 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.
