How to protect your organization from overtime claims

The law firm offers five key steps employers should take to address the risk of overtime claims:

1. Determine which employees are entitled to overtime pay and which are “exempt”
Overtime cases commonly arise from “misclassification”, with employers classifying staff as exempt from overtime compensation when legally this is not the case. Employers need to examine exemptions carefully — and not apply them broadly. Generally, overtime pay will apply to all employees, salaried or otherwise, unless the individual falls within one of the specific exemptions specified by legislation (for example, for employees whose duties are truly “managerial” in nature).

2. Determine which categories of employees need modern remote-access tools.
Assess the option to only provide remote-access tools to employees that are exempt to overtime compensation. Where this is not realistic, the next step is fundamental for employer’s consideration.

3. Create, implement and rigorously enforce a general overtime policy and, specifically, a remote-access overtime policy.
Policy should set out any limitations on the use of remote access tools, as well as requirements for the authorization and prompt reporting of overtime.

4. Keep an accurate record of all hours worked.
Employers have a statutory obligation to maintain proper records of all hours worked. In the event of subsequent litigation, such records may be critical in disputing a claim of overtime hours worked.

5. Assign employees work targets that are reasonable within an employee’s regular work hours.
Overtime work completed under “over-worked” conditions, on a remote-access tool or otherwise, can result in a finding that the employer has “tacitly” approved the overtime hours being claimed.

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