As an employer, an organization has to abide by state and federal laws. It also needs to walk a fine line between attracting the best employees and keeping costs reasonable. Hiring and retaining the best workers while also managing company costs can be a bit of a challenge. For example, a company may offer a competitive hourly wage for its workers, which will increase its overall staffing costs.
Such practices may ultimately benefit the company because it has better workers who are likely more motivated to do their best for the organization. However, the organization may seek to avoid more significant expenses by having an internal rule against overtime. Companies often have rules in their employee handbooks that make it clear they do not allow workers to arbitrarily stay late to accrue overtime.
Organizations may have a zero-overtime policy or may require approval from a manager or the corporate offices for someone to work overtime. However, such policies – often instituted with good intentions – could potentially lead to lawsuits against a company if applied or enforced in the wrong way.
Workers deserve overtime pay if they work overtime
No company policy is more important than federal wage laws, regardless of what terms a company includes in its handbooks or contracts. Although a company can refuse to let its workers perform overtime work, it cannot refuse to pay them for the time they worked.
When properly implemented, a rule against overtime will prevent employees from putting in more than 40 hours per work week. So long as workers do not go over that threshold, the company can maintain its no overtime stance without risking any kind of legal consequence. If a worker is on the clock for more than 40 hours in a given workweek, the company will have to pay them overtime wages.
Even in a scenario where the worker violated a company policy by staying without explicit permission from management or corporate offices, the business will still be responsible for paying overtime wages for any time worked beyond the first 40 hours. Careful scheduling practices and proper staff training can drastically reduce the likelihood of workers accidentally earning overtime and putting the company in a difficult situation.
Learning about and complying with wage laws is crucial for a company’s long-term success. As a result, seeking legal guidance proactively concerning these issues can help a business safeguard its interests both more efficiently and effectively than it otherwise might.