Overtime: Pay it now or pay it after a lawsuit — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
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Overtime: Pay it now or pay it after a lawsuit

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in Human Resources

Before you pile extra work on employees without paying overtime, make sure you've correctly classified your workers.

A California jury recently ordered Farmers Insurance Exchange to pay overtime to 2,400 claims adjusters going back to 1993. The total: $90 million. Farmers claimed the workers were administrative employees exempt from overtime, but the court said the workers didn't qualify. The company plans to appeal.

This isn't an isolated case. Several other class-action Fair Labor Standards Act cases are pending or have been settled recently. And a recent government study says almost half of white-collar employees worked more than 40 hours per week last year, more grist for lawsuits.


To help determine if you've properly classified employees, request our free, two-page checklist, Exempt vs. Nonexempt: Where to Draw the Line. Send an e-mail request to customer@nibm.net with the subject line "Exempt vs. Nonexempt," or call us at (800) 543-2055 and give us your fax number.

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