From a business perspective, it's important to keep track of when and how long your employees work; You want to make sure they're being paid correctly for the hours they've put in and that you're not overpaying or underpaying your team.
But keeping track of the hours of your hourly workers and non-exempt employees is more than good business practice. under the federationFair Labor Standards Act (FLSA)and individual state labor laws, keeping records of your employees' hours is actually a legal requirement.
But what are the time clock rules for hourly employees? What information do you need to track? How do you need to track this information? And what should you do with that information once you've archived it?
What working hours do you need to keep track of?
First things first before jumping into all thingstime trackingSo let's quickly tackle the employee time you really need to keep track of.
If you have hourly employees, tracking their hours is absolutely necessary. But where employers sometimes get confused is when it comes to salaried employees.
When it comes to salaried employees, you may or may not need to keep track of your hours; it all depends on whether they areexempt or not exempt. Exempt salaried employees are not eligible forovertime pay- and as such, there's no need to keep track of your hours. Non-exempt salaried employees, on the other hand, are eligible for overtime pay; therefore, even if they are paid a wage, you must track their hours to determine if and when to pay overtime.
Now that you know the employee time you need to track, let's move on to the time clock rules you need to know for hourly employees and non-exempt employees:
Get your employees in and out
As an employer, you are obliged tokeep accurate recordsthe number of hours worked per workday and the total hours worked per workweek for each non-exempt or hourly employee who works for your company. And the easiest way to track your employees' work time? Have them come and go every day.
Technically, a timing system is not necessary;according to the US Department of Labor(DOL), “Employers may use any timing method they choose... Any timing plan is acceptable as long as it is complete and accurate.” This means you can keep track of your employees' hours using digital time tracking tools, punch card system, written time cards or timesheets, check-in and check-out via an app on your mobile phone. ... the most intuitive system for your company.
Regardless of the system you use, the important thing is that your employees come and go every day and come and go when they start and finish work. This will ensure accurate record keeping for your business and ensure you are in compliance with FLSA regulations.
Using clock rounding correctly
Under the FLSA, employers can choose to track employee time in 15-minute increments, and if an employee's actual hours worked fall outside these increments, they can round to the nearest quarter-hour. just make sure you areroundingto the nearest quarter hour; so for minutes 1 to 7 you would round down and for minutes 8 to 14 you would round up.
For example, let's say you have an employee who shows up for work at 8:09 am. m. Instead of setting your check in time to 8:09 am. m., you can round up to 8:15. m. However, if they showed up at 8:06 am, you'd round up to 8:00 am. m.
Pay overtime for anything over 40 hours (and know how much overtime you have to pay)
Not only does federal law require you to pay overtime, California does too.Strict rules on overtime payfor non-exempt employees. Under California state law, you must provide overtime hours equivalent to one and a half times the regular hour or employee non-exempt rate of pay for:
- Working more than eight hours (but less than 12 hours) in a single day
- Work more than 40 hours a week
- The first eight hours worked on the seventh consecutive workday in a workweek
You must increase this overtime pay to double the employee's regular pay rate by:
- Working more than 12 hours in a single day
- Any hour in excess of eight hours worked on the seventh consecutive workday in a workweek
If your employees are working hours above and beyond the standard eight hour day, 40 hour week, be prepared to compensate for their time with overtime pay.
Never allow non-exempt or hourly employees to work outside of working hours.
Under the FLSA, it is against federal law for non-exempt hourly employees to work after hours. And allowing non-exempt employees to work after hours, whether requested or voluntarily, can lead to serious problems for your business, including lawsuits.
Where business owners struggle is understanding what "working overtime" really means. Your employee is working off-hours if they perform any work-related tasks without having their time worked recorded and without being compensated for that time.
So, for example, let's say you own a construction company and your team is working on site at a customer's home. If one of your employees has to stay behind at the end of the day and answer customer questions for an hour, that is the time worked and must be recorded and paid. Otherwise, it is considered working overtime.
Or perhaps you are organizing anetsevent at your company and some employees volunteer to arrive early to help you organize things. Even if this type of work is outside of their typical job duties (and even if they have volunteered), you are still asking your employee to do extra work and work overtime, and as such you will need to track and pay for it. that.
The point is, if you ask or allow your employees to work after hours, you are not only breaking wage laws, you are also putting your company at risk of a lawsuit, so make sure you and your employees be clear about what it means to "work off hours" and that hours worked are accurately tracked, recorded and paid.
Understand on-call work and what it means for your employees' hours
Depending on your type of business, there may be times when you need your employees to be on call. But do you need to provide on-call pay for those hours?
The answer is, it depends.
Lowcalifornia law, if your employees are on "restricted call duty", meaning they must be at their place of work or in a location that allows them to arrive within 15 minutes, they must be paid at least minimum wage for the time spent waiting for an Authorized call to work. If theysonCalled to work, they must be paid the regular hourly rate for any time spent responding to the authorized work call, including commuting time. (In terms of time tracking, employees will need to separately record the time they spent waiting for the call and the time they spent answering.)
If your employees are on "unrestricted call" it means they are free to engage in personal activities while they are on duty; as such, this time is not considered working time and on-call pay is not required. If they end up being called to work again, they are paid the regular hourly rate for the time spent answering the call, including travel time (or a minimum of two hours, whichever is longer).
It is important to understand the rules about on-call work, including how to control on-call time and when on-call pay is required; That way, you can keep proper records and ensure your employees are compensated with on-call pay when needed.
Stay on top of these time clock rules for hourly employees
Understanding time clock rules for hourly employees and accurately tracking the time of your non-exempt employees is critical. Time tracking is not only important to ensure that your employees are paid fairly (including overtime and on-call pay), but it is also important to protect your business and ensure that you comply with all state and FLSA employment laws.
EmHourly,We make it easy for business owners to track their employees' time. With the Hourly app, you can enable mobile time logging, see who's working in real time, ensure you're complying with labor laws by tracking overtime pay and taking necessary breaks, and collect signed timesheets from your computer, all with a few taps on your Smartphone.
you want to know more aboutTime tracking solutions for hourly employeesand how can they support your business?Sign up for a 14-day free trial today!
FAQs
What is a legal minimum amount that an employer must pay for one hour of work? ›
FLSA Minimum Wage: The federal minimum wage is $7.25 per hour effective July 24, 2009. Many states also have minimum wage laws. In cases where an employee is subject to both state and federal minimum wage laws, the employee is entitled to the higher minimum wage.
Can you refuse to go from hourly to salary? ›You can convert an hourly employee to a salaried employee as long as the worker meets FLSA requirements and state laws that qualify them to be exempt. You can decide to do so if they are going to be taking on a new position or if you are reorganizing your team.
How to tell an employee you are cutting their hours sample letter? ›_________] Dear [Mr./Ms. Last Name]:
I regret to inform you that, due to [reason: e.g., lack of funds, lack of work, reorganization] in the [agency/department name], it is necessary to implement a reduction-in-force in the form of reduced work hours.
Related to Section 2301(g)(2) of the CARES Act, Section 206(e)(2) of the Disaster Tax Relief Act provides a special rule for employers that filed an employment tax return before December 27, 2020. Such employers may elect to treat any "applicable amount" as an amount paid in the fourth calendar quarter of 2020.
What is the smallest amount to legally pay a worker? ›The federal minimum wage for covered nonexempt employees is $7.25 per hour. Many states also have minimum wage laws. In cases where an employee is subject to both the state and federal minimum wage laws, the employee is entitled to the higher of the two minimum wages.
What is the maximum number of hours an employee can work before an employer must pay overtime in Nova Scotia? ›In general, employers are not required to pay overtime until the employee has worked more than 48 hours in a week.
When a manager cuts your hours? ›Schedule a meeting with your supervisor to talk about the situation. Remain calm and collected as you inquire about reduced work schedule. Use this meeting as an opportunity to convey your interest in working full-time and to showcase why you should be considered an essential employee.
How do I inform an employee of pay cut? ›Include the date, employee's name, reason for the salary reduction, and the effective date on your salary cut letter. You may also want to include a section for the employee to sign to show they understand the reason for the reduction.
How do you tell your employer they are breaking the law? ›If you wish to report a widespread violation of labor law by your employer or a violation affecting multiple employees, please contact LETF via phone, online lead referral form or email: Call the LETF Public hotline anytime: 855 297 5322. Complete the Online Form / Spanish Form. Email us at letf@dir.ca.gov.
What is the amount of annual liability to be switched to a 944 filing status? ›Form 944 reports the amount of income tax withholding and FICA tax an employer is responsible for paying. Only employers whose annual employment tax liability is less than $1,000 and have received approval from the IRS are eligible to file Form 944 (instead of Form 941)
Can my boss tell me not to talk about my salary? ›
You also have the right not to engage in conversations or communications about your wages. When you and another employee have a conversation or communication about your pay, it is unlawful for your employer to punish or retaliate against you in any way for having that conversation.
Why would a company switch employees from salary to hourly? ›Switching salary employees to hourly rids you of having to ensure that the respective employees meet the FLSA's exempt criteria, which includes the salary level, salary basis and job duties tests.
What is 15.50 an hour annually? ›$15.50 an hour is $31,000 a year in annual income.
The calculation assumes 50 work weeks with an average of two weeks of holidays in a year.
What is the average salary in USA 2023? The average salary in USA per month or year varies widely across industries, jobs, age, experience & education, and geographical locations. According to the latest figures by the Bureau of Labor and Statistics, the average salary in USA per month is $6,228 or $74,738 per year.
What is the lowest salary in the US? ›The federal minimum wage of $7.25 per hour applies to states with no set minimum wage, and to most workers in states with lower minimum wages. Specifically, those working for employers subject to the Fair Labor Standards Act. Special minimum wages apply to some workers in American Samoa.
What will the federal minimum wage be in 2023? ›| State | 2022 Minimum Hourly Wage | 2023 Minimum Hourly Wage |
|---|---|---|
| California | $14.00 for employers with 25 or less workers; $15.00 for larger businesses. | $15.50 for all employers. |
| Colorado | $12.56 | $13.65 |
| Connecticut | $14.00 | $14.00 |
| Delaware | $10.50 | $11.75 |
Overtime Pay
On a work week basis, this act requires employers to pay a wage of 1 1/2 times an employee's normal pay rate after that employee has completed 40 hours of work for workers 16 and over. Weekend or night work does not apply for overtime pay unless it is over the mandated 40 hours.
An employee can work a maximum of 38 hours in a week unless an employer asks them to work reasonable extra hours. See our Maximum weekly hours fact sheet.
What is the overtime rate? ›1.5x or not less than one and a half times the hourly rate of pay. 2. During rest days: Less than half of normal working hours.
Can a manager change your shift last minute? ›Yes, an employer can change your schedule at the last minute. The Department of Labor states that an employer may change a worker's hours or work schedule without giving notice or obtaining permission from the worker. It is legally allowed for an employer to change your work schedule at the last minute.
Can a manager clock you out without your knowledge? ›
These actions are unlawful and violations of the labor code. Your employer cannot clock you out without your knowledge. Employees who work off the clock can file a wage and hour lawsuit and seek compensation for unpaid wages.
Who to call when your boss rips you off over time hours? ›File a Department of Labor Complaint
One option is to contact the Department of Labor's Wage and Hour Division (WHD), which investigates wage theft concerns. All calls are confidential, and you can call to ask questions about labor laws even if you aren't sure you want or need to file a complaint.
Whether you are an hourly or salaried employee in California, you are entitled to receive the agreed-upon, legal rate of pay for the work you've already done. Bosses have the discretion to reduce hourly pay and salary rates just as they can raise them.
How do you tell a company the pay is too low? ›While I really appreciate the offer to work for such a great company, I, unfortunately, must decline at this time, as the salary isn't within my preferred range. I had a wonderful time speaking with you during the interview. I wish you luck in your search for a candidate. Thank you again for this opportunity.
How do you say no to a pay cut? ›If you do decide to reject the pay cut, you do not need to get into the details of your personal finances. You can simply say that while you understand the company is going through a difficult time, taking a pay cut isn't feasible for you right now.
What your boss can t say to you? ›Employment law prohibits employers from asking certain questions during employment interviews. These include questions regarding pregnancy, gender identity, sexual orientation, religion, age, race, national origin, marital status, and disability. Employers cannot use this information to make hiring decisions.
Can my boss talk bad about me to other employees? ›It also prohibited “making negative or disparaging comments or criticisms about anyone; creating, and sharing or repeating, a rumor about another person; and discussing work issues or terms and conditions of employment with other employees.” The judge concluded that the policy violated the National Labor Relations Act.
Can I sue my boss for talking behind my back? ›If it's spoken, it's called slander. If someone defames you and damages your reputation, you can sue them.
What is the shortest shift you can legally work? ›The Reporting Time Pay law, also known as the 4-hour minimum shift rule, requires employers to compensate workers who report to work but are not allowed to work their full hours. The term “4-hour minimum shift rule” is used when discussing this labor law because most standard workdays or shifts are eight hours.
What are the labor laws in Oregon? ›Summary. Oregon law prohibits an employer from discriminating and retaliating against employees in a variety of protected classes. Employers must also provide pregnancy accommodations, allow employees to access their personnel files, protect whistleblowers and allow wage discussions.
Is there a minimum amount of hours an employee must be paid for in California? ›
California's 4-Hour Minimum Pay Rule
The court held that: telephonic call-in requirements … trigger reporting time pay. If an employee's typical shift is less than four hours, California reporting-time law requires that the employee be paid a minimum of two hours at the employee's regular rate of pay.
Washington law requires employers to pay non-exempt employees 1.5 times their regular rate of pay for all hours worked over 40 in a workweek. The Fair Labor Standards Act also requires that non-exempt employees be paid 1.5 times their regular rate of pay for all hours worked over 40 in the workweek.
What is the longest shift someone can legally work? ›Presently, no OSHA standard to regulate extended and unusual shifts in the workplace exists. A work period of eight consecutive hours over five days with at least eight hours of rest in between shifts defines a standard shift. Any shift that goes beyond this standard is considered to be extended or unusual.
What is the longest legal shift in a day? ›Generally, workers can legally work up to 24 hours in a single day. However, there are some exceptions, such as workers who are: in a regulated industry, like trucking, under the age of 16, or.
Can my boss send me home early? ›Yes, you can send employees home early due to a lack of work. Exempt employees under the Fair Labor Standards Act (not entitled to overtime) would need to be paid their entire salary for the day. Non-exempt employees (those eligible for overtime) would generally only need to be paid for actual hours worked.
How long can you work without a break in Oregon? ›Meal periods of at least 30 minutes must be provided to non-exempt employees who work 6 or more hours in one work period. No meal period is required if the work period is less than 6 hours. Additional meal periods are required to be provided to employees who work 14 hours or more in a shift.
Is it legal to work 16 hours a day in Oregon? ›Oregon Manufacturing Overtime
In this industry, employees may not work for more than 13 hours in a single day. Employees are also entitled to receive a minimum of 10 hours of rest after any shift that lasts at least 8 hours.
Is there a maximum number of hours employees can work during a day? For most adult workers, there are no limits on daily work hours. Theoretically, employers may schedule employees to work seven days a week, 24 hours per day, so long as minimum wage and overtime laws are observed.
Is it legal to get paid $14 an hour in California? ›Minimum wage laws protect employees by making sure that employers pay a minimum hourly rate for all the hours that employees work. In California, the state minimum wage in 2021 is $14 if you work for an employer with 26 or more employees, and $13 an hour if you work for an employer with 25 or less employees.
Is it legal to work 4 10 hour days in California? ›Does California make an exception for 4/10 work schedules? Close. Yes — California's overtime law has a special rule that allows for a 10-hour workday within a 40-hour workweek. However, the schedule must be validly adopted through a clearly defined legal process.
How do you say no to pick up a shift? ›
- Confirm your schedule. ...
- Ask to have a conversation. ...
- Give as much notice as possible. ...
- Acknowledge your obligation. ...
- Provide a reason. ...
- Plan ahead for your workload. ...
- Offer to make up the time. ...
- Understand the consequences.
All workers must receive a meal period of at least 30 minutes for every 5 hours worked. If they work more than 11 hours in a day, then they must receive an additional meal period of at least 30 minutes.
What is unfair labor practices in Washington state? ›Controlling, dominating, or interfering with a bargaining representative. Discriminating against an employee for exercising their rights under the state collective bargaining laws. Refusing to collectively bargain with the employer or union over wages, hours or working conditions.
How long can you work without a break in Washington state? ›Employees must be allowed a paid rest period, free from duties, of at least 10 minutes for every 4 hours worked. Additionally: Employees cannot be required to work more than 3 hours without a rest break. Breaks must be scheduled as close to the midpoint of a work period as possible.