The current worker shortage is putting the squeeze on employers and forcing them to take new measures to run their businesses. For example, many employers are dealing with stagnant hiring and skeleton crews by requesting employees to “volunteer” to work extra hours.
But when is this acceptable, and what are the guidelines regarding mandatory overtime? How can you address the need for additional labor from your existing staff, without violating federal and state time and pay laws?
Is It Legal to Force Employees to Work Overtime?
Before we get into the legalities regarding overtime under these current circumstances, consider the broader issue of employee morale. Forcing employees to work more hours than they’re interested in (even when paid appropriately) can create frustration and resentment. Similarly, expecting maximum productivity from a skeleton crew for weeks and months at a time can hurt morale and push your valued workers out the door.
If your business is struggling to fill positions or maintain a full staff, you may turn to existing employees to work more hours. But before doing so, be clear on the rules and restrictions with mandatory overtime.
With those considerations in mind, you may decide “volunteerism” for additional hours is the only solution to the labor shortage. To stay on the right side of the Fair Labor Standards Act (FLSA) and avoid complications, be aware that:
- Nonexempt (or hourly) employees must be paid at least the minimum wage for all hours worked for the benefit of your business, as well as overtime for 40+ hours in a week (and possibly daily overtime depending on state/local law). This overtime distinction is critical: Nonexempt employees are entitled to pay at the rate of 1.5 times their regular hourly rate for their overtime work.
- Similarly, nonexempt workers must be paid for all hours worked, whether it’s work done at the job site, during a commute or at home. Never ask them to work “off the clock,” which may include answering emails or using other communication platforms outside of working hours.
- You can request and/or require extras hours from your exempt (or salaried) employees, as needed. But be certain the additional work meets the criteria for specific job duties tests – typically for executive, administrative and professional employees — to avoid destroying the employee’s exemption status under the FLSA. For example, having an employee with an executive exemption perform a significant amount of nonexempt, manual work, such as stuffing envelopes, answering phones or cleaning up the facility. In this case, the employee’s primary duty is no longer supervising the work of two or more employees, per the applicable exemption test.
- A nonexempt employee cannot volunteer to work without pay or off the clock for a for-profit or private sector employer. This is strictly prohibited under federal law, regardless of the employee’s wishes, and you must compensate employees for their time. (The rules are different, however, for public agencies and nonprofit organizations.)
- Developing an organized and flexible process for overseeing volunteer or mandatory overtime is recommended. Employees should feel comfortable speaking with their managers about any personal reasons preventing them from working overtime. And it’s a courtesy to give employees at least two to three weeks’ notice of any mandatory extra time.
Under the FLSA, employers must maintain accurate records of payroll status and total hours worked by nonexempt employees. You can use any timekeeping method you choose, including written time sheets and automated systems.
Prioritize Posting Compliance During These Changing Times
To ensure complete compliance with FLSA requirements, you must also display all applicable postings in every business location. For 365 days of federal, state and local posting compliance, rely on the industry-leading labor law poster service, Poster Guard® Compliance Protection. Coverage includes all necessary labor law postings (including the FLSA posting), automatic replacements at no additional charge, a 100% Compliance Guarantee against posting fines, and continual legal monitoring and expert.
Be aware, too, that some states require employers to provide handouts to new hires specifying rate of pay, overtime policy (including when overtime will be paid and the applicable rate of pay) and other pay-related protections. The Premium Mandatory Employee Handout Service helps businesses with 50 or more employees comply with federal, state, county and city notice requirements like this, as well as other triggered notifications.