As a small business owner and employer, you may believe that your company’s policies are in full compliance with the current employment laws. However, the truth is that many employers are unknowingly violating labor laws on a regular basis. Here are the five most common labor laws that employers regularly break, whether they know it or not.
Using an Exempt Status to Avoid Paying Overtime
You don’t get to decide which of your employees will be eligible for overtime pay. It all depends on the type of work they do for your company. All jobs will either fall into an exempt or non-exempt category. According to Entrepreneur, exempt employees are usually paid a salary and aren’t eligible for receiving extra pay for working more than 40 hours a week. Exempt employees usually perform a relatively high-level of professional work. Unfortunately, many employers incorrectly categorize employees as exempt to avoid paying overtime wages.
Allowing Employees to Work Off the Clock
You must pay non-exempt employees for all non-de minimis time that they work. This includes tasks that they might do outside of their regular working hours. If your employees answer emails or take phone calls from home at night or on the weekend, you must pay them for this time, advises U.S. News and World Report. To avoid breaking this law, you need to establish a clear, written work-time policy, closely monitor the hours your employees work and train everyone that there can’t be any off the clock, work for non-exempt employees.
Telling Your Employees They Can’t Discuss Their Wages
You can’t keep non-supervisory employees from talking about their salaries with their colleagues. This is because if they aren’t able to uncover potential payroll injustices within the company, the employees can’t effectively organize or unionize. Unfortunately, many people believe that this kind of policy is normal and have no idea it is a violation of labor laws.
Disciplining Employees Who Complain About Work
The National Labor Relations Act protects all non-supervisory employees and their right to discuss working conditions and wages with each other, whether in a private or public forum. Attempting to control or limit what your employees say on social media violates their rights to engage in a protected concerted activity. If you have questions about this particular labor law, speak to a qualified labor attorney for a free consultation.
Hiring Independent Contractors But Treating Them Like Employees
If you try to control where, when, and how a person completes their work, the government says they must be treated as an employee and pay their payroll taxes, as well as offering them the same benefits that you provide for the rest of your employees. However, many companies continue to hire independent contractors but treat them like employees in every way but pay. If you end up misclassifying workers, you can end up being subjects to substantial fines and back taxes on both the state and federal levels. These fines could be as high as 100 percent of the employment tax that is due.
The labor laws in this country can be confusing. However, as an employer, it is up to you to know what you can and can’t do when it comes to your employees. Understanding the various laws can keep you from facing substantial penalties and fines.