Exempt EE Timesheet question

I've searched the past 4 years' posts, and I've found a few on this topic, but none that address my specific question(s)...

Our CEO requires exempt EEs to complete the same timesheet non-exempt EEs use. He has for 10 years instructed exempt EEs to put no more than 8 hours on any single day, and swears that legal counsel advised him to do this. I have openly contradicted those instructions, and he and I are having a meeting this week to come to an agreement on this topic.

Just three of the downsides I see are:

1. (Legal) If anyone were to successfully challenge an exemption, we've potentially put ourselves in a jam by keeping inaccurate records that would not be useful for remediation.

2. (Motivational) We're telling exempt staff they have nothing to gain by working longer hours, but will still lose sick or annual leave time if they work shorter hours.

3. (Ethical) We're telling exempt staff it's okay to create inaccurate records as long as we say so.

Are there more downsides I'm missing? I'd love to be as well-armed as possible in this meeting.

Also, what could some of the possible advantages of his timekeeping method be? He hasn't told me yet, but I'd like to have time to think about them before the meeting if possible.

Thanks for your input!


  • 13 Comments sorted by Votes Date Added
  • I truly don't understand why he would do this. You are not paying these people for overtime anyway. You wouldn't be able to do this for non-exempts and I'm sure that all of your records show overtime and daily hours.

    All I can find on the DOL site is that time records can be done any way you choose so long as they are complete and accurate. Let us know how it goes.
  • Maybe he is not as interested in the hours so a straight 8 hour day will do. He might just be interested in a quick way to determine what days the employee might have taken off during a pay period for PTO, sick, or vacation and this would be reflected on the time sheet.

    Then again, if he never sees the timesheets that would not be a legitimate explanation.
  • I know of a small community bank in this area that requires their exempt ee's to record their time worked just like everyone else; but they record the actual time not simply 8 hours each day. This information is not used to compute weekly time at all, just as a matter of recording when they were there; more for an attendance record. Maybe back ten years ago the legal council stated to simply write in at least 8 hours each day.
    I agree with you. Why would you want to maintain attendance/payroll records for anyone when the records are not accurate. Seems to me this could cause you more harm than good in the long term.
    Good luck...
  • We keep an attendance calendar on each ee, exempt or non-exempt. Time worked is not noted, but absences are. Logging the absences on the calendars is the responsibility of the managers in our outlying office and of the office manger for the corporate, but I see no reason your exempts couldn't log their own absences.
  • You can see why I'm struggling with this question...

    I can see several better ways to record hours for exempt EEs, but I can't think of a worse way to do it. I guess I am hoping someone else on this forum does the same thing and can tell my why.
  • We do it the same way and the reason "why" is we have always done it that way and my arguements to change it have, to date, failed. I feel for ya ;)
  • Frank, I don't know if this helps, but it's a similar situation.

    We employ salespeople that fall under a special DOL exemption from overtime. However, they are NOT exempt from the min. wage requirement. I asked why we are not keeping timesheets on these people to ensure they are at least getting min. wage for hours worked...the answer I got was, "Well, that's just the way we've always done it, and it would be too difficult to instill that sort of control."

    Even though I pled my case, I could not get management to start timesheets on these EEs. If your manager adopts the same hard stance, I would urge you to do what I did - provide management with every possible bit of documentation, and a memo clearly stating why you advocate a change to existing policy. If it ever comes back on the company, you have done a nice CYA.

    More "ammunition" for you to look for: (1) court cases involving timesheet/exemption discrepancies, (2) articles/whitepapers on challenges to exemptions, timekeeping of exempt EEs, (3) articles on organizational behavior of exempt EEs, especially where timekeeping is concerned.

    Best of luck - I've been in your shoes, and it's not a fun pair to stand in!
  • I think I would start the conversation with the CEO by asking what situation prompted the prior legal advice to post no more than 8 hours per day. That might have been a response to a fact-specific situation that your CEO is misapplying to all situations. You might also suggest that as the FLSA was revised a few years back, perhaps, it's time to get an updated legal opinion.

    We require exempt employees to report their time on a time sheet; but we do require the time sheets to be accurate.
  • Great suggestion for an opener, David - I will definitely use that. The funny thing is this... In about a month, this becomes a moot point - we're going to an automated time and attendance system. It is NOT going to cap hours at 8 per day, obviously. This whole exercise is about keeping score between yesterday's methods and tomorrow's.
  • There are significant downsides to this procedure. DOL has stated that exempt employees do not lose their exemption by being required to keep a time sheet. It can be a morale issue (exempt people don't think they should keep time sheets), but that can be overcome if done right.

    There are two reasons to require an exempt employee to keep time sheets: (1) so you have an accurate record of actual time worked in case the DOL or the courts disagree with your assessment that the employee is exempt; (2) so you have an accurate record of actual time worked to determine whether the employee worked 1250 hours prior to a qualifying event under the FMLA.

    Of course, requiring them to keep inaccurate records defeats both of these purposes. And, frankly, anytime a plaintiff's lawyer can argue that you intentionally kept inaccurate records, you are in trouble.

    *The above should not be used as legal advice on a particular matter. The posting here to your inquiry does not create an attorney/client relationship.
  • I would also look at what your State regs require. Our State's Wage & Hour are much more stringent regarding exempt / non-exempt, as well for other items such as corrections to a time sheet -- it MUST ALWAYS be initialled by the EE prior to being corrected and paid. The State recently hired 3 more investigators who are going "door to door" to audit companies, and the fines (that I know of ) have been quite significant -- although they're always open to discussion to reduce those fines. One company was fined $15K -- and this was for inaccurate time cards PRIOR to the current HR person coming on board. She was able to get the fine reduced significantly -- but, do we really want those headaches? I know I don't :) !

    Coincidentally, we are now going through another "training course" for managers regarding proper completion of time sheets -- not only are managers completing them incorrectly but they are approving time sheets of their staff that are incorrect! We seem to hit this cycle every 3 years or so.

    Just something to consider.
  • I recently presented a question to the Forum regarding recording time worked for non-exempts vs absence reports (record of using paid time off bank) for exempts.

    We are a public employer and employees can earn and bank compensatory time. We are developing a policy to determine if the exempts can earn comp time, at what point does the earning begin (after 40 hr/wk, 44/wk etc) We have drafted an absence reporting form which shows the hours worked over 8 in any day - any travel time that may be considered as hours over 40/wk. Also I have included a column for supervisors to use to authorize a permitted deduction from the salary if the bank of PTO has been exhausted.

    BUT, realizing that law does not "require" exempt employee to earn comp time, it's a management decision as to if it will be allowed at all. It will go to our legal counsel for final approval.

    In any event, any records submitted to our payroll dept will be accurate.

  • I'll be interested to hear what your legal counsel says.. .Exempts getting comp. time sounds pretty weird to me, but sure would like to sign up.
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