One of the most important issues Georgia businesses have with employees is how to classify them. The U.S. Department of Labor’s Fair Labor Standards Act (FLSA) sets out specific guidelines as to which employees are to be considered exempt from overtime pay and which are to be paid it. An incorrect classification could result in a company not only having to give an employee or employees the overtime they were denied, but the company could face additional damages as well.
A grocery store owner in the northwest failed to apply the correct classification to 11 employees. He claims that several of his employees requested to be considered salaried despite the fact that they did not meet the legal classification set forth in the FLSA. Managers and supervisors may be exempt from overtime pay. However, employees who do not hold these positions are supposed to be paid time-and-a-half for any hours they work beyond 40 hours in any given work week.
An investigation conducted by the federal Wage and Hour Division in Portland, Oregon, concluded that the store failed to properly pay overtime to the 11 employees from March 2013 through March 2015. Therefore, the owner owes the employees in question unpaid overtime of approximately $49,600. In addition, the store is required to pay damages to the group in the approximate amount of $49,600.
Georgia businesses could end up in this same position if they do not appropriately follow the classification guidelines in the FLSA. Any company who is unsure of how to classify its employees would most likely benefit from discussing the matter with an attorney who is familiar with wage and hour law. Otherwise, the business could find itself being sued for overtime pay due to what could be considered a paperwork error.
Source: oregonlive.com, “Portland grocery store agrees to pay 11 workers nearly $100K in overtime, damages“, George Rede, May 28, 2015