$50 (bonus) + $750 (hourly earnings) = $800 (all compensation)
$800 (all compensation) / 50 (hours worked) = $16 (“regular rate” of pay)
$16 (regular rate) / 2 = $8 (per hour that is owed for overtime)
In this case, $16 is the regular rate of pay that is used for calculating overtime. Because the employee worked 10 hours of overtime, the employer would still owe $8 per hour for 10 hours, which amounts to an additional $80.
Keep in mind one note about bonuses. Bo- nuses of a “discretionary” character are not included in calculating the “regular rate” of pay. Accordingly, if an employer provides a holiday bonus not dependent on factors such as productivity, quality or attendance, those bonus amounts are not included in the “regu- lar rate.” Importantly, employees must not come to expect or rely on such “discretion- ary” bonuses and both the fact of payment and the amount of payment must remain in the sole discretion of the employer. Never- theless, based on the calculation above, it is easy to see the importance in distinguishing the traditional “hourly rate” of pay from the “regular rate.”
What are my recordkeeping obligations?
The FLSA sets forth specific recordkeeping requirements applicable to both exempt and nonexempt employees. For both exempt and nonexempt employees, employers must maintain the following information for each employee: 1) full name; 2) home address in- cluding zip code; 3) date of birth, if under 19; 4) gender; 5) occupation; 6) the time and day on which the employee’s workweek begins; 7) the total wages paid each pay period; and, 8) the date of payment and pay period covered by each payment.
Additionally, for nonexempt employees (i.e., those employees subject to the FLSA’s minimum wage and overtime provisions), employers must maintain the following information: 1) the regular hourly rate of pay; 2) the number of hours worked each workday and each workweek; 3) the total daily or weekly straight-time earnings; and, 4) the total overtime earnings.
In addition to the specific information that must be maintained, the regulations require that employers keep the above records at the “place or places of employment.” Payroll records must be retained for a period of three years while other employment information and earnings records must be retained for at least two years. Further, upon request from the DOL, the records must be made available for inspection within 72 hours of any request.
Do I have to provide paid lunch breaks?
Under the FLSA, employers are not required to provide lunch breaks of any set duration. Importantly, many state laws do require employers to provide lunch periods of a specific duration, generally dependent on the number of hours worked. Notably, however, Missouri does not impose any such require- ments but rather, leaves the issue of provid- ing breaks to the discretion of the employer. Further, if an employer does offer lunch breaks to its employees, then the FLSA does regulate whether that time is compensable.
One important distinction is whether the time is considered a rest break or a meal period. Under the FLSA, if an employer offers rest breaks, which are generally character- ized as breaks lasting between five and 20 minutes, then those rest breaks are compen- sable. However, if an employer offers a bona fide meal period (i.e., lunch break), generally lasting 30 minutes or more, then that time is not compensable. Significantly, to qualify as a bona fide meal period not compensable under the FLSA, the employee must be “com- pletely relieved from duty.” In other words, if the employer requires its employees to per- form work duties during those meal periods, then the time is compensable. For example, if employees in a dental office are required to remain at their desks or work stations during lunch, then the FLSA requires that lunch period be paid.
Accordingly, dental practitioners who provide unpaid lunch breaks should ensure that employees are not performing work during such breaks. Remember, the employee must be completely relieved of perform- ing any work in order for a meal period to be unpaid. A dental practice should have in place a policy and procedure whereby it
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instruct its employees to record as work time any portion of the meal period in which they work to ensure they are compensated. The policy is a demonstration to the regulators of a compliance culture within the practice. A dental practice does not want to find itself presented with an FLSA violation for off-the- clock work. It is very expensive to deal with that type of violation.
A practice with questions about its compli- ance status is encouraged to consult with an attorney knowledgeable and experienced in the subject area. f
This article was written by Curtis Summers, a partner and Robert Rojas, an associate, both in the Kansas City, Missouri office of Husch Blackwell LLP. The Firm acts as outside general counsel to the Missouri Dental Association. The information contained in this article should not be construed as legal advice or a legal opinion on any specific facts or circumstances. The contents are intended for general information purposes only, and readers are urged to consult their own attorney concerning their own situation and any specific legal questions.
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