Employers today have more responsibility than ever of the management of their workplace. Establishing an effective employee relations program is crucial for managing your most valuable asset, your employees. The annual Managing Labor & Employee Seminar will specifically addresses the issues facing employers. The half-day seminar will provide information to better equip you in dealing with workplace management issues including managing employee technology access, preparing employees for Obamacare and the potential pitfalls of FLSA.

3. Federal Legislation

4. Department of Labor
» Wage-Hour Division
» OFCCP
4

5. Equal Employment Opportunity Commission
» Strategic Enforcement Plan

6. Reconsider Your Background Checks
The National Labor Relations Board
» Protected Concerted Activity
6

7. The Affordable Health Care Act

9. What Are We Talking About?
» The wall between work and personal time is gone.
» Mobile devices enter the work realm in two ways:
o Company provides devices or pays for work use
o Employees use their own personal devices for work
purposes (BYOD)
» Work on mobile devices creates two categories of
potential liability:
» Data and Security
» Employee Behavior

10. What I Want You to Do

11. What I Want You to Do
» Acknowledge the potential problems.
» Make informed business decisions.
o Should you provide devices or encourage
employees to work on personal devices?
o How can you limit your liability?
» Revise and enforce your policies.

12. The Skinny
» Use of mobile devices to work is a risk no matter
what.
» The only way to guarantee your ability to access
and control information on a device is to own it.
» BUT you can manage risks by adopting policies
and agreements that fit your risk tolerance, trust
assessment, and regulatory context.

13. Data-Related Liability
Your security is only as good as the practices of your most careless employee.

14. Data Security
» Protection against third parties
o Independent Contractors
o Lost or stolen devices
o Malicious software
o Gateway to the Cloud
» Protection within the company
o Employee access

15. Preserving & Collecting Data from Devices
» Litigation holds, record retention, and
investigations
» Terminated employees
» Wiping information
» Employee Privacy
o Evidence of a disability
o GPS tracking

16. Data-Related Liability
» Government enforcement actions
» Civil penalties
» Litigation
o Third-party rights in the data
» Breach of contractual obligations
» Breach of statutory obligations

17. Behavior-Related Liability
You can teach an old dog new tricks.

18. Wage and Hour Issues
» Nonexempt Employees
o Off-the-clock work
» Work during unpaid leave

19. Acceptable Use
» Harassment
» Discrimination
» Distracted driving
o Liability for damages to persons injured
» Verdicts and settlements in the $15-25 million range

20. Termination of Employment
» Owning the phone number
» Return or wiping of the device
» Cutting off access

21. Conduct a Self-Audit
Check yo’self before your wreck yo’self.

22. Important Questions
» What issues already exist in the company?
» What data is mobilized in your workplace?
o Do third parties have rights in this data?
» Who needs mobile access to what?

23. To Buy or Not to Buy?
» Company purchases and owns the device
» Compensate employees for the work use of a
personal device
o Stipends
o Reimbursement
» Employee use their own device (BYOD)
o Less security
o Less control over use

24. Company-Issued Devices
Pros – Control Cons – Monitoring
Company owns the phone number, Choosing the right provider and plan
software, and data transmitted
Can deactivate or wipe the device Monitoring use
remotely
More monitoring acceptable Setting a precedent
GPS tracking
Financial responsibility for lost or
damaged devices?
Tech support?

25. Devices Are Not Appropriate
for All Employees.
» Does the employee work with sensitive
information?
» Is availability of the employee critical?
» Is the employee organized and responsible?

26. High Risk Employees
» Senior executives whose data is more likely to be
relevant in litigation
» Those who handle trade secret/sensitive information
» Sales staff who have a hold on the goodwill of
customers and who will continue to use the phone
number if they leave
» Nonexempt staff who could claim “off the clock” work
» Contractors or other contingent workers who may be
performing work on their personal device for other
customers

27. Modify Company Policies
A change will do you good.

28. Agreements as a Precondition to Use
» Reduce expectations of privacy
» Notify employees of risks
» Require consent to reasonable access, such as:
o Install security software
o Copy data to meet litigation hold demands and
record retention obligations
o Remotely wipe the device of company
information

29. Data Security
» Limit types of data accessible from mobile
devices
o Passwords and encryption
o “Sandbox”
» Limit use of cloud-based storage to company data
» Report lost/stolen devices
» No friends or family
» Provide IT support

30. Acceptable Use
» Company liable for use during the course of
employment
o All other company policies apply to use
» Harassment, discrimination, etc.
o Address mobile issues
» Distracted Driving – explain what to do

31. Limit Wage and Hour Liability
» If working outside of work hours, consider:
o Managers and supervisors may be the problem
o Employees must record all time worked
o Prior written authorization to work remotely via
mobile devices

32. Revise Exit Interview Process
» What devices has employee used?
» What information may be stored on
employee’s own devices?
» Can you preserve personal information during
wipe of company information?
» Disable all employee’s devices’ access to
company systems.

33. Evaluate Insurance Coverage
» Does your insurance cover additional “cyber-
risks” that mitigate the data-related risks?
» Verify incidents arising form employees’ use of
their personal devices are covered by
company insurance policies.

34. Parting Thoughts
» A multi-disciplinary solution
is best.
» Analyze existing policies to
determine how they relate
to and impact employees’
use of personal devices.

35. Thank You!
Kailee Goold, Associate
kgoold@keglerbrown.com
(614) 462-5479

37. Relationship Problems
» Three Main Types of Employees Facing
Discipline:
1) Currently incompetent but can become competent.
2) Currently incompetent and will not ever become
competent.
3) Self-gratification focused. They are more concerned
with benefitting themselves, which causes
misfeasance and nonfeasance.

38. I’m Telling You,
I’m Telling You
The Importance of Communication

39. Communicate the Rules
» Brendan Feheley’s “Hot Stove” Example

40. Remember How That Lasted
for a Day?
The Importance of Documentation

41. What to Document
» Performance Problems
» Misconduct, Workplace Rule Violations,
Employee Disputes
» Absenteeism and Tardiness

42. How to Document
» Be factual, not conclusory
» Be accurate
» Never consider or mention protected classes or
protected activities
» Avoid sugarcoating
» Give details and examples
» State consequences clearly
» Write as a neutral observer,
without emotion

43. Employee Evaluations
» Make them Count!
o Be Honest
o Be Comprehensive
o Be Accurate
o Be Specific
o Evaluate Performance, not Personality
o Provide Deadlines

44. Dump Truck the Evidence
» Barnette v. City of Charlotte

45. Documentation Must Be Accurate
» Jaszcyszyn v. Advantage Health Physician
Network
o A fairly simple case of Facebook idiocy that might
not have been filed but for the employer’s
inaccurate information.

46. Consistency in Application
» Brown v. Ryder Sys. Inc.
o A black employee was terminated allegedly for
tardiness and failure to meet performance goals.

47. Screaming That I’m Right
The Disciplinary Procedure

48. Progressive Discipline
» Warnings
» Suspension
» Termination

49. Additional Considerations During the
Termination Process
» Officer or Director?
» Fiduciary?
» Non-Compete Agreement?
» Triggering Benefit Plan Language
» Firing out of kindness
» Immediately secure all personnel files & evidence

50. Cushion the Blow
» Ways to make an exit easier on the employee
» Ways to make an exit easier on the company
» Ways to make termination easier on the
person doing the terminating

51. Up in the Air

52. Thank You!
Jeffrey C. Miller, Director
jmiller@keglerbrown.com
(216) 586-6651

54. Patient Protection and
Affordable Care Act (PPACA)
Presented By:
Ralph E. Breitfeller
Stefan Thomas
Kegler, Brown, Hill & Ritter
A Legal Professional Association

55. AFTER
12/31/13
TBD 2013
Liability
12/31/13 Noticeability
10/1/31 Group
Health Plans
1/31/13 Exchange
1/1/13 W-2
HAS/FSA
Health Care Reform Timeline
IMPORTANT EVENTS IN 2013

56. Amending Health Flexible Spending
Arrangements (FSAs)

57. W-2 Reporting

58. Notices to Employees for the
Exchange & Premium Tax Credits
Notice of Exchange Notice of Premium Credits
Availability & Cost-Sharing Subsidies
Employer contribution < 60% = Employee
Existence of Health Benefit Exchange may be eligible for premium tax credits and
cost-sharing subsidies
Employee purchases through Exchange =
How the Exchanges operate Employee will lose employer contributions
and employer contributions are excludable
from income tax
Under what circumstances employees may
receive coverage
Employees purchase QHP through Exchange may lose
employer contribution and all or portion of employer
contribution to employer-provided coverage may be
excludable for federal income tax purposes
Contact information for customer service
resources within Exchange and explanation of
appeal rights

59. EMPLOYER SHARED
RESPONSIBILITY
THE FUNCTIONALITY OF THE EMPLOYERS’ SHARED RESPONSIBILITY

60. What is “Shared Responsibility?”
EMPLOYERS’ SHARED RESPONSIBILITY

61. Calculating Full-Time Employees (FTEs)
EMPLOYERS’ SHARED RESPONSIBILITY

62. EXAMPLE 1: Hourly-paid employee
(i) Employer K’s taxable year is the calendar year. Employer K's payroll
records indicate that Employee A was an hourly employee who worked
173 hours per month for January through November of 2014, worked 93
hours in December of 2014 and was paid for 80 hours of annual leave in
December of 2014 (for a total of 173 hours for December of 2014).
(ii) Employee A had more than 130 hours of service in each month in
calendar Year
(iii) Employee A was a full-time employee of Employer K for each month
during calendar year 2014.

63. EXAMPLE 2 : Non-Hourly Employee
(i) Same facts as Example 1, except that in calendar year 2014, Employee B
is a non-hourly employee who worked for Employer K five days per week for
50 weeks, and was paid 80 hours of vacation leave for two weeks (40 hours
per week). Employer K applies the days worked equivalency for Employee
B.
(ii) Employee B is credited with 40 hours of service for each week in the 2014
calendar year (50 weeks worked and 2 weeks for which payment was
made).
(iii) Employee B averaged at least 30 hours of service per week during each
month in calendar year 2014.
(iv) Employee B is a full-time employee of Employer K in each month in
calendar year 2014.

64. EXAMPLE 3: Applicable Large Employer
(i) In each month in calendar year 2014, Employer L has 20 full-time
employees, 30 FTEs, and no seasonal employees.
(ii) Because Employer L has 50 FT employees (20 full-time
employees + 30 FTEs) during each month of 2014 and the seasonal
employee exception is not applicable, Employer L is an applicable
large employer for calendar year 2015.

65. EXAMPLE 4: Seasonal Employees
(i) In calendar year 2014, Employer N has 40 full-time employees for January
through December none of whom are seasonal employees. In addition,
Employer N also has 80 seasonal full-time employees that work for Employer N
from September through December. Employer N has no FTEs.
(ii) Before applying the seasonal employee exemption, Employer N has 40
fulltime
employees during each of eight calendar months of 2014, and 120 full-time
employees during each of four calendar months of 2014, resulting in an average
of 66.5 employees for the year (rounded down to 66 full-time employees), an
average greater than the average of at least 50 full-time employees required
for applicable large employer status. However, in this example, Employer N’s
workforce exceeded 50 fulltime employees (counting seasonal employees) for
no more than four calendar months (treated as the equivalent of 120 days) in
calendar year 2014, and the employees in excess of 50 during those months
were seasonal workers.
(iii) Accordingly, because of the seasonal employee exemption, Employer N is
not an applicable large employer for calendar year 2015.

66. EXAMPLE 5: Seasonal and Other FTEs
(i) Same facts as in Example 4, except that Employer N has 20 FTEs in
August, some of whom are seasonal employees.
(ii) The seasonal employee exemption is not available if the number of an
employer’s FT employees (including seasonal employees) exceeds 50
employees for more than 120 days during the calendar year. Employer N
has at least 50 FT employees for a period greater than four calendar
months (treated as the equivalent of 120 days) in calendar year 2014.
Therefore, Employer N is not eligible for the seasonal employee exception.
As a result, Employer N averages 68 FT employees in 2014: [(40 x 7) + (60 x 1)
+ (120 x 4)] ÷ 12 = 68.33, rounded down to 68.
(iii) Accordingly, Employer N is an applicable large employer for calendar
year 2014

67. Plan Requirements
1. Affordability test.
1. Minimum Essential Coverage Test.
2. Minimum Value Test.

68. Affordability Test
Coverage is considered “unaffordable” if the required employee
contribution towards the cost of self-only coverage exceeds 9.5% of the
employee’s household income.

69. 1. What is the Employee’s contribution for single coverage?
2. Does it exceed 9.5% of employee’s wages reported in Box 1 of the W-2?
If yes, then not affordable and look to the safe harbor.
If no, then it is “affordable”.
Safe Harbor 1 (rate of pay):
Does employee contribution exceed 9.5% of computed monthly
wage? If not, then fit into safe harbor.
For hourly employee, hourly wage x 130. For salaried employee,
monthly wage as of January 1, 2014.
Safe Harbor 2 (Federal Poverty Level):
Does employee contribution exceed 9.5% of the most recently
published Federal Poverty Level ($11,490 in lower 48 states)? If
not, fit into the safe harbor.

70. The “Minimum Value” Test
EMPLOYERS’ SHARED RESPONSIBILITY

71. • Ambulatory • Hospitalization • Prescription Drugs
Services • Maternity/Newborn • Laboratory Services
• Emergency Care
Services
Essential Health Benefits
EMPLOYERS’ SHARED RESPONSIBILITY

72. OTHER ITEMS

73. Summary of Benefits & Coverage
(SBC)

74. Medical Loss Ratio Rebates
Employer’s
Distribution Duty
Distribution Plan
Document
Plans Subject to Non-Federal Group Plans; Neither ERISA
ERISA Health Plans nor Governmental

75. Taxes & Fees

76. Automatic Enrollment

77. Not
Permissible
Permissible
Eligibility
Waiting Period Conditions Based
Exceeding 90 Solely on Lapse of
Days a Time Period of
No More Than 90
Days
Other Eligibility
Conditions Unless
Designed to Avoid
90-Day
Compliance
Waiting Periods
EMPLOYERS’ SHARED RESPONSIBILITY

78. Other Miscellaneous Summary Items
1. 1/1/14, no annual limits on dollar amount of essential
coverage.
2. 1/1/14, no preexisting coverage exclusions.
3. Individual shared responsibility.
4. Anti-Retaliation Provisions:
 Employee reporting alleged violations
 Employee going to exchange

79. Contact
Ralph Breitfeller Tom Sigmund Stefan Thomas
rbreitfeller@keglerbrown.com tsigmund@keglerbrown.com sthomas@keglerbrown.com
(614) 462-5427 (614) 462-5462 (614) 462-5484

80. Presented by Brendan Feheley

81. Introduction
For a weddin present Ledbetter gave his son Amos two
hundred dollars. Two weeks later he asked him, "Watcha do
with the money, son?" "Ah bought me a wristwatch, Pappy!"
answered the boy. "Yew dumb ignoramous!" yelled his
father. "Yew should av bought yoreself a rifle!" "A rifle? What
fer?" "Supposn one day yew cum home and find some guy
sleepin wid yore wife," explained the older redneck. "Watcha
gonna do? Wake him up and ask him what time it is?“
» Keeping time and compensating employees for
time “worked.”

82. A penny a day…
» Feb. 12, 2013: kgb USA Inc. agrees to $1.3 million
dollar settlement of claims relating to minimum
wage violations for misclassified workers working on
piece rates.
» January 16, 2013: The Children’s Place agrees to pay
$1.5 Million relating to off-the-clock claims.
» January 8, 2013: Rite-Aid agrees to pay $21 Million
settlement relating to claims of allegedly
misclassified assistant store managers and co-
managers
» May 2012: Columbus, Ohio Bar/Restaurant Group
owners pay $250,000.00 to settle claims alleging
illegal tip pool.

83. We’re all Professionals Here
2 possible problems
#1. “We pay him on salary, he can work as many hours as we want.”
NO!!!!!!!!!!!!!!
» In order to be Exempt must meet TWO criteria
o Must be paid a salary of $455.00 per week
o Must also have duties that meet one of the 5 exemptions
» Executive
» Administrative
» Professional/Creative
» Computer
» Outside Sales

84. We’re all Professionals Here
#2 Misclassification of Employees
Most problems occur with outside sales and administrative exemptions.
» Administrative exemption:
o whether the employee has authority to formulate, affect, interpret, or implement management policies or
operating practices; whether the employee carries out major assignments in conducting the operations of
the business; . . . whether the employee has authority to commit the employer in matters that have
significant financial impact; . . . whether the employee provides consultation or expert advice to
management; . . . [and] whether the employee investigates and resolves matters of significance on behalf of
management
o Rules and Parameters that govern job are less likely to be considered Administrative
» Blotzer v. L-3 Communs. Corp., 2012 U.S. Dist. LEXIS 173126 (D. Ariz. Dec. 5, 2012)
o Field Inspectors not covered by administrative or executive exemption.
» Christopher v. SmithKline Beecham Corp., 635 F. 3d 383 (Sup. Ct. June 18, 2012)
o Pharmaceutical Sales Reps are outside sales people, thus exempt!
» Petitioners obtain nonbinding commitments from physicians to prescribe respondent’s drugs. This kind of arrangement, in the unique regulatory
environment within which pharmaceutical companies operate, comfortably falls within the catchall category of “other disposition.”

85. There Aint No Free Lunch
» Meal periods
o Employee chooses to sit at desk during lunch and eat...
» The employee must be completely relieved from duty for the purposes of
eating regular meals. Ordinarily 30 minutes or more is long enough for a bona
fide meal period.
» The employee is not relieved if he is required to perform any duties, whether
active or inactive, while eating. For example, an office employee who is
required to eat at his desk or a factory worker who is required to be at his
machine is working while eating.
o Automatic lunch breaks in computer system are MAJOR problem.
» Break times
o You offer 2 15-minute breaks per day (unpaid of course)
» Employee chooses to take 3 10 minute breaks.
» Problem?
o Affordable Care Act
» Nursing Mother Break

86. Hours worked
» “I’m really glad you got that new iPhone. Now you and
Siri can keep on working all night long.”
o Don’t rely on lack of knowledge
» Phone bills
» E-mail records
o Be careful about reliance on “de-minimus” exception
» Only applies on small increments of time (not half hour phone
calls).
» Electronic technology issues
o Who has access?
o On what devices?
» If employees have access you should assume they’re using it.

87. Improper Deductions (from your revenue)
» Uniforms
o You can make employees pay for their uniforms,
but...
» Can’t take the employees wages below minimum.
» Need in writing in Ohio.
» Pro-rata deduction is ok.
» Remember laundry and maintenance costs.
» Other Deductions
o “For the Benefit of the Employer”

88. Deductions
» Other Deductions
o Tools used in the employee's work
o Damages to the employer's property by the employee or
any other individuals
o Financial losses due to clients/customers not paying bills,
and theft of the employer's property by the employee or
other individuals.
» Even if an economic loss suffered by the employer is due to the
employee's negligence.
o Employers may not avoid FLSA minimum wage and
overtime requirements by having the employee reimburse
the employer in cash for the cost of such items in lieu of
deducting the cost from the employee's wages.

89. Deductions from Salaried Employees
» Most times, can’t do it.
o If employee works at all during the workday they need to be paid.
» What happens when they exhaust paid leave and need to miss a half day?
o Still get paid, absence still an absence.
» When can you deduct pay?
o When an employee is absent from work for one or more full days for personal reasons (not
sickness or disability);
o For absences of one or more full days due to sickness or disability (have to have a policy or
practice of providing compensation for salary lost due to illness);
o To offset amounts employees receive as jury or witness fees, or for temporary military duty
pay;
o For penalties imposed in good faith for infractions of safety rules of major significance;
o For unpaid disciplinary suspensions of one or more full days imposed in good faith for
workplace conduct rule infractions;
o In the employee's initial or terminal week of employment if the employee does not work the
full week; or
o For unpaid leave taken by the employee under the federal Family and Medical Leave Act.

90. Independent Contractor
» Test
1. The extent to which the services rendered are an integral part of the
principal's business.
2. The permanency of the relationship.
3. The amount of the alleged contractor's investment in facilities and
equipment.
4. The nature and degree of control by the principal.
5. The alleged contractor's opportunities for profit and loss.
6. The amount of initiative, judgment, or foresight in open market competition
with others required for the success of the claimed independent contractor.
7. The degree of independent business organization and operation.
» Certain factors which are immaterial
o the place where work is performed,
o the absence of a formal employment agreement,
o or whether an alleged independent contractor is licensed by state/local
government.

91. Independent Contractor
» Tips
o Is the individual doing what another employee is
or would be doing in a full-time capacity?
o How long is the relationship expected to last?
o Is the individual holding themselves out to other
businesses?
o One individual or many?
o Incorporated?

92. Comp Time.
» First, comp time cannot be provided in lieu of overtime pay by a
private employer. 29 U.S.C. § 207(o).
» Second, under the limited circumstances where a public employer
may award compensatory time off instead of paying overtime
wages, the comp time must be 1.5 hours off for every one hour of
overtime worked.
» Also a problem for exempt employees
o Salary is a mark of executive status because the salaried employee
must decide for himself the number of hours to devote to a particular
task. In other words, the salaried employee decides for himself how
much a particular task is worth, measured in the number of hours he
devotes to it.
o ????

93. Training, Testing & Orientation
o Orientation
» Pay employees for time!
» Employees subject to the FLSA must be paid for all time
spent "in physical or mental exertion (whether burdensome
or not) controlled or required by the employer and pursued
necessarily and primarily for the benefit of the employer and
his business." Tennessee Coal, Iron & R.R. Co. vs. Muscoda
Local 123, 321 U.S._590, 598 (1944)
o Testing:
» Pre-employment drug testing: NOT COMPENSABLE
» On-Job testing: 6 factors
o Training: Depends on who is benefitting from training
and whether it’s mandatory.

94. Interns
» 6 Factor test
o The internship, even though it includes actual operation of the facilities of the
employer, is similar to training which would be given in an educational
environment;
o The internship experience is for the benefit of the intern;
o The intern does not displace regular employees, but works under close
supervision of existing staff;
o The employer that provides the training derives no immediate advantage from
the activities of the intern; and on occasion its operations may actually be
impeded;
o The intern is not necessarily entitled to a job at the conclusion of the
internship; and
o The employer and the intern understand that the intern is not entitled to
wages for the time spent in the internship.
» DOL 2010 Fact sheet
o Very Very Narrow interpretation

95. Waiting Time
» Key question: Was employee engaged to wait
or waiting to be engaged?”
o Key is employer control
» Was employee free and clear of duties?
» Do they have to stay on your premises?
» If no, how far can they go, and how quickly have to
return if called?
o Have a policy explaining everything
» Employee initial.

96. Travel Time
» Work Performed While Traveling: Any work that an employee is required
to perform while traveling must be counted as hours worked.
» Home To Work Travel (Commuting): Compensable if (1) the employee
starts their workday before the commute; (2) the employee performs
work while commuting; (3) the employee drives the employer’s vehicle;
(4) the employee is commuting to a special assignment out of town; or, (5)
the employee is commuting in an emergency situation.
» Travel That is All in the Day's Work: Time spent by an employee in travel
as part of his/her principal activity, such as travel from job site to job site
during the workday, is work time and must be counted as hours worked.
» Travel Away from Home Community: Travel that keeps an employee away
from home overnight is travel away from home. Travel away from home is
work time when it cuts across the employee's regular workday or
corresponding hours on nonworking days.
o Normally compensable except time spent in travel away from home outside of
regular working hours as a passenger on an airplane, train, boat, bus, or
automobile.

97. Travel Time Tips
» Give orders day before
o If have to receive in morning... Compensable
» Plan out-of-town travel outside work hours when
possible
o Plane flight between noon and 3 is compensable,
between 7pm and 10pm not compensable.
» Carpooling is good.
» If employee has non-fixed situs then get
agreement on area to be covered.

98. Tips & Tip Credit
» Tipped employees are those who customarily and regularly receive more than $30
per month in tips.
» Tips are the property of the employee. (Regardless of whether the employee is a
“tipped employee”)
» The maximum tip credit that an employer can currently claim under the FLSA is
$5.12 per hour
o (the minimum wage of $7.25 minus the minimum required cash wage of $2.13).
» Tip credit does not apply to any tipped employee unless the employee has been
informed of these tip credit provisions.
o Get in writing
» Sums distributed to employees from service charges cannot be counted as tips
received.
» Credit Card fees: Can only deduct the amount you actually pay in fee.
o So pick lowest amount and automatically deduct that.
» Tip pooling or sharing arrangement only valid when among employees who
customarily and regularly receive tips.
o Can’t include managers or other employees who aren’t “tipped employees”

99. Different Work- Different Wages
» Exempt/Non-Exempt issues
o What is employee’s primary duty?
» Tip Credit problems: Employee employed both as a
maintenance person and a waitperson, the tip credit is
available only for the hours spent by the employee in
the tipped occupation.
» Weighted Average: If employee works two jobs and
works overtime general rule is has to be paid weighted
average of two jobs.
o Unless agreement with employee that overtime will be
paid at the rate paid for the work.
» Get agreement in writing.

100. Bonuses
The following bonus payments are excluded from overtime:
o payments made for gratuitous reasons;
o bonuses made as gifts on special occasions that aren't
measured by, or dependent on, hours worked, production, or
efficiency;
o discretionary bonuses (the payment and amount of the bonus
is solely your discretion and the employee is not entitled to it
under any contract, agreement, or promise);
» Can’t have a formula
» Attendance bonus. Not ok.
o bonuses made as profit-sharing payments from a bona fide
profit-sharing plan, trust, or savings program that conforms to
Department of Labor (DOL) regulations.
» Put a letter in a file with the bonus.

101. Commissions
» "regular rate of pay" includes commissions
o Means overtime often times includes added
payment.
» E.g. Inside sales employee gets paid $200 dollar base
salary plus $500 commission for a week. Employee
works 50 hours that week. Regular rate =$14.00 OT
rate = $21.00. Employee owed $70.00 in compensation
for week.
o Don’t back into the regular rate.
» No “de-minimus for wages owed”

102. Conclusion
1. Little problems can easily become big
problems when applied to entire workforce.
2. With travel time, if it seems simple, it’s
probably wrong. Come up with policies
governing travel and have them reviewed.
3. Watch deductions!
4. Paying someone a salary DOES NOT make
them exempt.

103. Thank You!
Brendan Feheley, Associate
bfeheley@keglerbrown.com
(614) 462-5482