The Planner

DOL on the prowl

Scroll down to see more
Arrow down button
The Planner illustration graphic
Close popup button
June 23, 2011
Core Group US
Small Business
DOL on the Prowl

If you’ve never had the pleasure of dealing with the Department of Labor, you are lucky. Consider the following true story.

When a Relationship Goes from Bad to Worse

Disgruntled employees. We’ve all had them; hell, I’ve been one a couple of times myself. It becomes troublesome when they leave and have an ax to grind. There are many ways an ex-employee can cause you angst:

Internal Revenue Service: “They didn’t withhold my taxes”
Equal Employment Opportunity Commission: “They discriminated against me because I was old (or young, or purple, or ugly, insert your own variable)”
The Judge and Jury: “They sexually harassed me”
Department of Labor “They didn’t pay me the right amount. I worked overtime”
The last one is the focus of this article.

How to Double the Cost of Your Ex-Employee

Recently we had a client who was investigated by the Department of Labor. I don’t know the reason why the employee left, but they were the only one in the business besides the owner. The ex-employee complained that they had worked full time, but had not been paid for all of their time. The employee had only worked part time, but the employer had neglected to keep any of the old time records, and hence couldn’t prove what the employee had worked. Result? $22,000 fine to the employer ( two years worth of back wages to full-time). Ouch!

The Big Assumption

But wait, you say. I only have salaried employees. This is one of the areas of great confusion with small employers. Just because you pay an employee salary, doesn’t mean they aren’t eligible for overtime. In general, any individual who is not an “exempt employee”, regardless of how they are compensated, are to be paid overtime for all time over 40 hours in a seven consecutive day time frame (Oklahoma and Federal law, but this varies by state).

So what is an exempt employee? It depends on, but generall, they have to be in a supervisory role and manage people. There are also exemptions for certain seasonal jobs. The real scary question is if you had a salaried person quit, can you prove they didn’t work over 40 hours. Our experience tells us that most business owners don’t track time for salary employees, simply because they don’t think they have to. Maybe they don’t have to, but it sure makes a lot of sense to!

The bottom line is that there are very few businesses (even those with only one employee) that shouldn’t be keeping time records for their employees. We have some great, inexpensive web based solutions, but whether you use a payroll service or not, make sure you are doing it right. It is very expensive to be wrong.

How long to I keep records:

Contact our offices in Oklahoma City: 405-288-1209 or Tulsa: 918-209-3441 to get the help you need.

Ask Us a Question
Seems like no one has asked a question yet. Be the first one to do so by filling the form below
Thank you for engaging with us!
We’ll review your question and notify you as soon as we post our answer as quickly as possible. If you have any other questions, you can reach us at your earliest convenience
Oops! Something went wrong while submitting the form.
More Related Content
We couldn't find any related content.
Corey using his computer

Ready to make more money and keep more of it?

Each day you tell yourself you’ll get to this “one day” you are throwing money out the window. You risk getting to a point where you want to exit or retire, but you aren’t able to. The growth of your business, and your ideal outcome for your future depend on setting this up now.

Schedule Free Consultation
Contact Us
We respect your Privacy. The information you provide will be used to answer your question or to schedule an appointment if requested.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Close popup button