Employees on Payroll Performing Other Work

Guys: Give me your take on this.

It is my understanding that if you have an hourly employee who works 40 hours a week for you and then they perform other work on the weekend, they will have to be paid overtime for this work - even if it has nothing to do with their 40 hour job during the week. Even if this second job is at another rate,they will have to be paid a "blended" overtime.

What about a special project? We have an IS person who would like to do a special project for us on weekends. I say this is the same thing - they are still entitled to overtime, even if you propose to pay them a flat rate for the project. You will still have to pay them for the number of hours they spent on the project.

The question I got from our CFO is: "What if they form a Consulting Company" and their company is paid the money. I contend the DOL will look at this as a way of trying to get out of paying the employee overtime.

Another question is got was: "What is the employee is exempt". Can we pay them a flat rate to perform project work outside of what they normally do during the week? I concur that we can as we are paying them a "salary" for the work they perform during the week and if they perform a task on the weekend, then this is outside of what their "salary" covers.

Let me know if I am on the right track here. We have a CFO who fancies himself being "creative" with Wage & Hour and I contend that he is setting himself up for trouble.

Comments

  • 3 Comments sorted by Votes Date Added
  • Most IS employees are non-exempt and should be paid overtime. Unless this guy manages a staff or has at least a four-year degree and works on his own writing programs, he is probably non-exempt. Having said that, pay the overtime! Don't try to cut a deal with the employee or try to find some way to get around Wage & Hour. It doesn't work. Err on the side of conservative and pay the overtime. In the long run, you will save yourself a lot of headache, sleepless nights and legal fees. Your CFO may think he is saving money now, but employees can easily get discruntled and then you have a mess. Don't be creative with this one.
  • You are correct on all counts. Forming his own company so that he can be an independent contractor - just for a project - yikes! The CFO will create a road to a bunch of problems.
  • These are my sentiments exactly guys! I think the DOL would catch on to this pretty quickly!
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