Our Blog

Articles and resources covering leave management, employee time and attendance, absence management and more.

Banner
By Sherman Morrison No Comments

New White Collar Overtime Eligibility Rules

When it comes to tracking employee time, one of the most important aspects is first accurately determining overtime eligibility for each worker. Who has to be paid overtime and who doesn’t have to be paid overtime has been relatively straightforward for a long time. This is because the rules around overtime eligibility haven’t changed much in a long time. But a big adjustment is in the works every business should know about. This article explains the change, what led up to it, a bit of history around overtime, and why it matters.

 

Overtime Eligibility Rules Date Back to the 1930s

With the Industrial Revolution in the 1800s, conditions for factory workers were often pretty horrible. And it took a long time for the federal government to do anything about it. It wasn’t until 1938 that the Fair Labor Standards Act (FLSA) was passed by Congress and signed into law by President Franklin D. Roosevelt. In addition to abolishing most child labor and establishing a minimum wage, it also required time-and-a-half overtime pay for some types of workers who put in more than 40 hours in a week.  

 

Keep in mind the spirit of the law was geared towards people involved in manufacturing kind of work, which is why a lot of employees are “exempt” from the regulation and don’t have to be paid overtime. The kinds of positions exempt from overtime include some administrative, professional and executive employees (and all the kinds of workers who are not employees, like independent contractors, outside salespeople, and many others) if they include the right mix of duties and are paid above a certain salary threshold. In other words, overtime laws were meant to protect blue collar workers, not white collar workers.

 

The white collar exemptions are tested three ways: If you are 1) paid a salary (not an hourly wage) and 2) are a white collar worker and 3) are paid above a weekly minimum salary, then you are considered exempt from the overtime regulations and your employer does not have to pay you overtime.

 

The Devilish Details of the Minimum Salary Test

The reason there is a minimum salary test is to protect low-income workers who have white collar jobs. The rule that’s in effect right now says any white collar workers who are paid a salary of less than $455/week ($23,660/year) have to be paid overtime for any hours worked beyond 40 in a given week. This particular minimum salary cutoff was enacted in 2004. Note that any white collar worker being paid a mere $24,000 could be required by their employer to work more than 40 hours/week with no overtime pay.

 

But here’s the thing most people don’t understand. Before the 2004 update of the rule, when was the last time the salary cutoff was adjusted? 1975! In fact, since the FLSA was passed in 1938, the salary threshold has only been updated a grand total of eight times in 75 years. And the adjustments are not tied to inflation, so increases are arbitrary and often fall short of what a fully-adjusted-for-inflation increase would be. The 2004 rule of $455/week, which is still in effect today, is less than the poverty threshold for a family of four! This overtime rule, for lack of keeping up with inflation, is playing a significant role in widening the gap between the rich and the poor in the United States. Back in 1975, nearly 63% of all full-time workers were eligible for overtime. The lack of updates to the rule has seen that number fall to less than 7% as of 2016. In other words, a whole lot of people who don’t make much money and who would really benefit from time-and-a-half overtime pay don’t get it because this rule’s salary threshold hasn’t been changed frequently enough and hasn’t been tied to inflation.

 

The Attempt to Update Overtime Eligibility 2016-2019

Towards the end of the Obama administration in May 2016, the Department of Labor (DOL) issued a rule to finally make a decent update to the rule that would have slightly more than doubled the salary threshold for while collar exemption to $913/week or $47,476/year. The percentage of full-time workers who would be eligible for overtime under the 2016 proposed rule would be 33% which is still a far cry from the 63% who were eligible after the 1975 update.

 

But the 2016 rule never took effect. It was challenged in the courts and declared invalid, which is really just another way of saying the business community didn’t want to pay fairer wages to their workers and rose up in opposition to the update, saying its hike was too high. Now, in 2019, another DOL rule update has been published for review, again attempting to increase the salary threshold, but not as high. The new cutoff would be $679/week or $35,308. If it is finalized, hard-working people in every state will benefit, but not as many or by as much as should be the case. The rule was proposed in March 2019. The required 60-day public comment period ended on May 21. If the rule is approved, it could still face court challenges similar to what happened in 2016. The DOL estimates the new rule will become effective in January 2020.  

 

Keep in mind that each state is free to pass its own overtime laws that are more generous than the federal law. When faced with different state and federal overtime laws, employers have to abide by whichever one results in more pay to the worker.

 

Other Considerations

Overtime eligibility through the FLSA law and DOL regulations are difficult to skirt. The regulations apply to all businesses engaged in any kind of “interstate commerce.” This covers virtually all businesses these days because most businesses can’t prove everything they do is contained within the state where they are headquartered. The rule covers anything bought from vendors, as well as banking relationships. It’s safest to assume your company will have to abide by the overtime laws and regulations at either the federal or state level.

 

Private sector employers also need to know they cannot just substitute “comp time” to avoid paying overtime. If a non-exempt employee works more than 40 hours in a given week, they must be paid time-and-a-half for the overtime. If an overtime-eligible employee works 56 hours in one week, you can’t give them two days off the next week to “even it out” and not pay overtime. You have to pay them 16 hours of overtime pay for the week where they worked 56 hours on their next regular payday. Comp time can only work within the span of a week. Note that some states specific eight-hour workdays as well, such that overtime has to be paid for more than eight hours in a day, regardless of the weekly total. Some states do allow private employers to make comp time arrangements with employees. Finally, public sector local, state or federal government entities are allowed to make comp time arrangements with employees in lieu of paying overtime, but there are strict rules governing this, and the comp time has to be “paid” at the time-and-a-half overtime rate.

 

Regardless of your opinion about the proposed overtime eligibility rule update, you still have to accurately track time worked and leave time for your employees. If your business is still trying to get by with paper forms and spreadsheets, we invite you to take a closer look at CaptureLeave. This cloud-based application is super-easy to use and yet offers robust functionality that can grow with your business. Give it a try before you buy with a 60-day free trial, and then enjoy affordable monthly pricing after that!

Tagged with: , , ,
By Sherman Morrison No Comments

7 Ways to Deal with Habitually Late Workers

If you’re a conscientious worker who always arrives to the office on-time, those who are habitually late workers probably drive you more than a little crazy – especially if you’re a manager or the person tasked with tracking and monitoring employee time. Part of the problem is how quickly late arrivals add up. If one employee arrives three minutes late twice week over the course of 48 weeks, that adds up to 4 hours and 48 minutes over the course of a work year or more than half a day! And if others notice that late arrivals are not dealt with, imagine how much time your company is missing out on if you’ve got a dozen employees doing the same. Here are 7 ways to deal with habitually late workers:

 

  1. Document Habitually Late Workers

Enlist the help of managers and supervisors in documenting late arrivals (or consider the use of some kind of time-clock app or even attendance beacons). Many employees simply don’t realize how often they are arriving late, and how much it adds up over time. While it may not be serious enough to warrant disciplinary action, you would at least have the data you need to include it in the employee’s performance review so they know it’s being noticed and a course-correction is in order. Having the data also helps when an employee pushes back about being late.

 

  1. Meet Privately with the Worker to Discuss

There’s no need to wait until an official performance review to let the worker that habitual lateness is both noticed and not acceptable – especially if your company only does performance reviews on an annual basis. In fact, you don’t want to let chronic tardiness go on for very long because the last thing you want to do is blow up at the employee. Have a low-key, private meeting with the employee to give them a chance to explain themselves because there could be very personal reasons for the lateness. No need for any public shaming here by calling them out in a meeting or anything like that. But this also doesn’t mean you have to just live with it. You’d be surprised how often people simply don’t realize how their lateness affects their co-workers or the company as a whole. Express your disappointment in the employee. If they like and respect you, they’ll feel bad about disappointing you and hopefully want to do better.

 

  1. Set Clear Expectations and Enforce Them

Getting to work on time is the most basic of company policies and expectations everyone has to follow or things can really start falling apart. This is why the ones who become the habitually late workers are so frustrating. You have to make it clear the tardiness is both unacceptable and will result in disciplinary consequences sooner than later if things don’t change. If that sounds like being “hard-nosed,” it’s not. Expecting workers to arrive on time is both reasonable and necessary to the success of your company. You might be surprised how many employees show up late simply because they can. It’s up to you and your managers to set clear expectations.

 

  1. Be Consistent with Expectations and Enforcement

Above all, you have to show everyone that your on-time arrival expectations apply to all workers and not just the ones that tend to get under your skin. Employees are highly attuned to fairness in the workplace. If some workers get away with being chronically late while others don’t, you’re going cause more problems than you fix. Some habitually late workers always make up their time by staying a little later, so you need to decide if that’s acceptable or not, and be prepared to answer questions about it when other people bring it up, which they will if they feel like they’re being singled out.

 

  1. Create an Improvement Plan

Put most of the onus on the employee to figure out what they need to do or change in their daily routines to get to work on time. If the problem is fairly serious, add in an accountability measure such as emailing you or the manager as soon as they arrive and sit down to get started with their work. Be as flexible as you can within reason to accommodate solutions. If changing the employee’s start time by 30 minutes (say because their daycare isn’t open early enough) doesn’t impact company operations, then go for it. That’s a win-win for everyone.

 

  1. Scale Disciplinary Action to Fit

You want to avoid taking disciplinary action if at all possible because it can create messy relationships and resentment, but you also need to be willing to do it if necessary, and make sure people know how that will work by outlining it to them. Start with something very light and scale it up if the employee fails to improve over time. You could begin with a verbal warning, and after that a written warning. From there, start docking their pay. One reasonable approach would be to dock their pay by the value of their late-time each quarter. Why quarterly? If taken out of each pay period, it might be too small to have much impact, but to see a larger chunk of money missing at the end of three months will be noticed and hopefully motivate change.

 

  1. Reward Improvement

If the employee corrects their tardiness issue, mention it from time-to-time. You should not reward improvement in this case with anything other than expressing your appreciation. After all, you’re already paying them to be here on time, so it’s a basic expectation they should be meeting and not something you should have to incentivize at all. Just thank them here and there for being on-time being willing to work on it.

 

As you can see, these are pretty standard approaches for dealing with habitually late workers. There’s nothing earth-shattering or creative here – the tried-and-true approaches are best in this situation. I did read about a psychologist who proposed a system where the employee with the most late-minutes in a given period would be required to tell a joke in a company meeting. I guess the idea is that this would be terrifying enough for most people to spur them to be on-time. Needless to say, I don’t think this is a good approach. Such a public calling-out could really traumatize some people. For others it might not be a punishment at all but an opportunity to perfect their stand-up act. But anyone would feel the pain of having their pay docked.

 

If your company is ready to ditch the paper forms and spreadsheets you’ve been using for time off requests and leave management, sign up for a 60-day free trial to see what CaptureLeave can do to automate and streamline your HR work!

Tagged with: ,
By Sherman Morrison No Comments

Handling Unpaid Leave Requests

There are times when an employee is going to want more time off than they have available to them through your company’s regular paid leave policies. Maybe the employee has applied for and won some kind of fellowship. Maybe they need to take some extra time to spend with family during a difficult time. Or maybe they want to embark on some kind of grand travel day. These kinds of situations can prompt an employee to file an unpaid leave request. Whether or not your company has an official policy covering this type of time off, handling unpaid leave requests can be tricky. This article provides some guidance on how to do it.

 

Pay Attention to How Employees Make Unpaid Leave Requests

Because most companies don’t have a specific policy around handling unpaid leave requests, a smart employee will go about this process delicately since they’re attempting to navigate largely unchartered waters. Managers and HR staff should keep an open mind to unpaid leave requests rather than just immediately rejecting them out of hand because they fall outside the company’s written benefits and leave policies. But savvy employees do negotiate unpaid leave. The ones who are successful approach it in thoughtful and creative ways.

 

The employee who asks for a substantial unpaid leave should be one who knows they bring a lot of value to the company and have a sense that you want to keep them on board. But this should also come through with a healthy dose of humility, not arrogance or cockiness. The desire to retain the employee also has to be balanced out with your desire to keep them close and engaged. If the employee is smart, they will have thought through any long-term goals they have with the company and address how those will be affected and maintained in light of an extended leave of absence. In other words, you want to see that they employee has thought through all the implications of this kind of leave and doesn’t approach it with a kind of cavalier attitude.

 

Is There Purpose to the Time Off Request?

Smart employees making unpaid leave requests will provide details on what it is they hope to accomplish during their time away and how it will benefit their work at your company. It might be developing a new skillset or making sure they don’t approach burnout. If they take the time to frame their request as something developmentally beneficial that will bring added value to the job, those efforts should be viewed favorably.

 

It also helps if they’ve put some effort into finding out the historical precedents of unpaid leave requests in your company, or even examples that they’ve learned of at other companies in your industry. In short, if an employee can present a compelling case for the purpose the time off, it should make a difference in how you respond. This would also include how well they’ve thought through potential objections, such as how their essential duties will be covered during an extended absence. If the employee has a solid plan for minimizing the impact of an absence (such as timing it to occur during a typically slow time for the business), that can go a long way towards easing understandable concerns your company may have.

 

Also assess the risks involved in your response. If this is a star performer you don’t want to lose, finding a way to work it out and grant the request could make a big difference to the employee’s long-term loyalty and tenure at the company. If denying the request might result in the employee quitting, are you willing to take on the cost of finding and hiring a replacement? Also, consider how willing the employee is to adjust their idea in order to make it happen, such as flexibility in timing of the leave, maybe doing it in several chunks if possible rather than all at once, and so forth. Be willing to work with the employee to figure it out in a way that is mutually acceptable to everyone involved.

 

As you can see, handling unpaid leave requests is a surprisingly complex negotiation process with many factors to consider. Both sides need to keep and open mind, be flexible, and plan carefully in order to find a mutually acceptable response that can provide benefits to both the employee and the company.

 

Whether it’s unpaid leave requests or regular paid time off, keeping accurate records of leave time is essential for your company to gain actionable insights into managing its workforce more effectively. If it’s time to ditch the paper forms and spreadsheets for a software solution that automates and streamlines many leave management tasks, take a look at what CaptureLeave offers your company. As a web-based, software-as-a-service (SaaS) solution, its robust features and ease of use are available to you 24/7/365 with nothing to download, install or maintain. Check it out for yourself with a 60-day free trial, after which you’ll love its affordable monthly pricing. Staying up-to-date on topics and developments related to leave management, employee time and attendance, absence management and more is easy when you bookmark the CaptureLeave Blog page and visit every week for the latest article and news you can use!

Tagged with: ,
By Sherman Morrison No Comments

Better Leave Management Brings 3 Big Benefits

A surprising number of companies aren’t doing one of the simplest things they could do to boost productivity and their bottom line: Better leave management. I think more companies would take this step if they truly understood what they’re missing out on. This article explains the 3 big benefits companies can reap with better leave management provided by the right software or app.

Read more ›

Tagged with: , ,
By Sherman Morrison No Comments

Is the Three Day Work Week Really a Thing?

Back in December 2018 I wrote an article here to answer the question, Is the Four-Day Work Week Finally Catching On? Soon after publishing the article, a number of people contacted me to say I should also write about the three-day work week. My initial reaction, I have to admit, was one of sheer incredulity. How can that even be possible? As it turns out, it is possible and people are doing it – but don’t worry, it’s more an individual thing than an employer thing. In other words, your company does not have to worry about offering a three day work week option any time soon, if ever. Read more ›

Tagged with: ,
By Sherman Morrison No Comments

Compassionate Leave: Expanding Bereavement Leave

Companies who want to do right by their employees have been revisiting their bereavement leave policies. In some cases, companies are expanding the traditional bereavement leave policy to include more paid time off. In other cases, companies are adding an additional category of leave called compassionate leave because life can serve up difficult situations that don’t include the death of a loved one.

 

Facebook Offers Expanded Bereavement Leave

Two years after Facebook COO Sheryl Sandberg’s husband passed away unexpectedly from a heart attack, the company revisited its bereavement policy. It expanded bereavement leave to 20 days of paid time off to mourn the death of an immediate family member, and 10 days of paid time off due to the death of an extended family member. This represented a doubling of their paid time off benefit for bereavement purposes. Facebook also adjusted illness-related time off to care for or be with sick family members. It now grants three days of paid time off to deal with a short-term illness, such as an immediate family member having the flu, and six weeks of paid time off within a rolling 12-month timeframe to be with a family member suffering from a more serious illness.

 

Other big companies such as Mastercard soon followed suit with similar expansions to their bereavement leave policies. It should be noted that there are no labor laws that require employers to offer bereavement leave of any kind, and only 60% of all workers and 71% of full-time workers have access to a bereavement leave benefit. When they do, it is on average only three days for the death of an immediate family member and only one day for an extended family member. When you think about the impact that grief can have on productivity in the workplace, these standard policies seem woefully inadequate.

 

Compassionate Leave for Life’s Major Curve Balls

There are also all kinds of difficult or traumatic events that can occur in life that have nothing to do with death of a loved one, which has prompted some companies to institute a new type of leave category called compassionate leave or family responsibility leave. In some cases, bereavement leave is included under this new umbrella category, but it’s meant to cover more than just death or serious illness. The types of emergency events that might qualify for compassionate leave are hugely variable, but in general would include an employee’s dependent suffering a traumatic event such as being the victim of a crime, having a nervous breakdown, a sudden change in caregiving of a dependent, and so on. Even though there may be no physical injury per se, the traumatic nature of the event can mean the dependent needs extra care and comfort or caregiver coverage.

 

There is no clear way to decide what sorts of emergencies might qualify for compassionate leave. Each company has to figure this out on their own, often on a case-by-case basis if it offers the benefit. Because of this variability, it’s also difficult to come up with a set amount of time off. For the sake of planning, a nominal amount of paid time off might be explicitly included in a policy, such as two or three days, with more time allowable if circumstances warrant it, the additional time off might be unpaid.

 

The nature of traumatic emergencies by definition means your company won’t have time to plan for a sudden unexpected absence. This highlights the importance of advanced contingency planning for how unexpected absences can be covered, whether that is accomplished through cross-training initiatives so multiple people know how to cover essential duties of other employees or having a good pool of on-call temporary workers who can step in when needed.

 

If your company is considering changes to its bereavement policies or instituting a new type of leave such as compassionate leave that covers emergencies other than bereavement, you’ll find leave management to be much easier if you adopt an easy-to-use robust software solution such as CaptureLeave. Because it is a web-based solution, you never have to worry about installing any software, maintaining it or updating it – we handle all of that behind the scenes. CaptureLeave can be accessed from your preferred devices that have an Internet connecting and web browser. Find out what CaptureLeave can do for you with a free 60-day trial after which you can enjoy affordable pricing as a monthly no-contract subscription fee based on the number of users at your company.

Tagged with: