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Florida’s climate is right for overtime lawsuits; build your defense

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in Best-Practices Leadership,Firing,Hiring,Human Resources,Leaders & Managers,Management Training

That dedicated employee working through her lunch period, even though she’s clocked out, could be a Florida employer’s biggest future liability.

Why? Because several South and Central Florida law firms have built lucrative practices on a solid foundation of overtime lawsuits.

Florida lawyers have a history of aggressive employment-law entrepreneurship. In the late 90s, several firms pursued ADA lawsuits by identifying retail stores with poor handicapped accessibility and sending in wheelchair-bound customers who later filed complaints. In one case, an attorney sent in his own uncle.

250 percent jump in OT lawsuits

The current litigation wave exploits employer confusion about overtime rules. A couple of years ago, the U.S. Labor Department made important changes to the federal Fair Labor Standards Act (FLSA) overtime regulations.

It’s taken a few years for employers to catch on to the nuances of the new FLSA world. But employees are catching on fast. Coupled with high-profile, class-action lawsuits against large employers such as Wal-Mart, employee FLSA awareness is at an all-time high.

To make the most of this opportunity, several Florida law firms have launched extensive TV ad campaigns. The result has been a 250 percent increase in overtime lawsuits in the South and Central Florida federal district courts over the past three years.

In raw numbers, employees filed 336 federal overtime suits in those two courts last year. That’s almost four times the combined number of suits filed in the three largest states: California, New York and Texas.

Employer vulnerabilities

Very few employers who violate the FLSA do so intentionally. Several common mistakes account for most FLSA lawsuits.

Who is exempt? The new OT rules say almost all employees who earn less than $455 per week are eligible for overtime (i.e., nonexempt from FLSA). For employees making more than $455, specific tests determine whether an employee is exempt or not. Employees are exempt (ineligible for OT) if they fall into one of these categories:

Executive employees:

  • Primary duty is management of the enterprise or of a department of the enterprise.
  • Customarily and regularly direct the work of two or more other employees.
  • Have the authority to hire or fire other employees or have input into hiring, firing or advancement decisions.

Administrative employees:

  • Primary duty is the performance of office or nonmanual work directly related to the management or business operations.
  • Primary duty also includes the exercise of discretion and independent judgment on significant matters.

Professional employees:

  • Primary duty is advanced scientific or intellectual work that typically requires an advanced educational degree; or, it involves the performance of work requiring invention, imagination, originality or talent in a recognized artistic or creative field.

Employees who work in computer system or software design or analysis have their own set of rules. Even if they are part-time, they can be exempt if they earn more than $27.63 per hour or the standard $455 per week used for other workers.

Employers should audit their pay records and job descriptions to make sure employees are properly classified. Remember: Paying someone a salary doesn’t automatically make him or her exempt. Even workers who are salaried and make more than $455 per week may be eligible for overtime if their job duties don’t meet the tests for their position.

Break times

The FLSA doesn’t require employers to offer breaks. However, if nonexempt employees are given breaks of 20 minutes or less, you must pay the employee for the entire period. Breaks of 30 minutes or more, such as lunch breaks, can be unpaid.

But employees must clock out and be totally relieved of duty during that period. If the employee is called back to work, he or she must clock back in and be paid for the time.  

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