7 Common Violations of Colorado Overtime Laws

Most Colorado employees are entitled to overtime pay (time and one-half their "regular rate of pay") for all overtime hours worked. Nonetheless, employers frequently violate Colorado and federal overtime laws. Below are seven of the most common violations of the overtime laws:

Assuming that salaried employees are not entitled to overtime pay: With the exception of higher level executive, management or professional staff, most salaried employees are entitled to overtime pay.

Failing to pay overtime for hours worked over 12 per day: Most people are aware of the requirement to pay overtime for hours worked in excess of 40 per week but many are unaware that overtime pay also is owed for hours over 12/day.

Failing to include all compensation in calculating the "regular rate of pay": In addition to salary or hourly pay, an employee's non-discretionary bonuses, stipends and shift pay, as well as most other compensation should be included in calculating overtime pay.

"Comp" time or averaging over more than one week: For purposes of determining whether overtime hours have been worked, each week stands alone. Thus, it is improper to average hours over two or more weeks or give "comp" time in lieu of overtime pay

Calculating overtime pay on the server minimum wage: Tipped employees can be paid less per hour on the theory that their tips make up the difference. This "server minimum wage" is generally $3.02/hour less than the full minimum wage. If, however, a tipped employee works overtime, overtime pay must be calculated on the full minimum wage.

Failing to include all hours worked in calculating overtime pay: Often employers fail to count hours worked by employees in determining overtime. For example, time before a shift preparing to work (e.g., putting on safety equipment or preparing machinery or equipment) or time after a shift preparing to leave is paid work time. Similarly, if an employee does not get her entire meal break, that time also must be counted as work time.

Misclassifying employees as independent contractors: Many employers call their workers independent contractors to avoid paying overtime. If, however, an employer retains a significant degree of control over how a worker performs his job, that worker generally is not an independent contractor.

If you think any of these issues apply to you, please visit our website, ColoradoWageLaw.com, for additional information or to contact our Colorado overtime lawyers.

Study Describes Restaurant Industry's "Race to the Bottom"

The Chicagoland Restaurant Industry Coalition, a group of academics, workers rights advocates, unions and restaurant owners and employees brought together by the Restaurant Opportunities Center of Chicago, has released a report entitled "Behind the Kitchen Door: The Hidden Costs of Taking the Low Road in Chicagoland's Thriving Restaurant Industry". According to the report, a living wage (pay that would allow a worker to support him/herself and a family without government assistance) is about $16.48 an hour. Unfortunately, more than 80% of restaurant workers in the Chicago metropolitan area reportedly make less than $10 an hour, with worker as fast food restaurants averaging only about $9 an hour. The report also notes that a majority of workers reported minimum wage and overtime violations, health and safety issues and other serious legal violations at the restaurants where they work, while more than a quarter reported working "off the clock" without pay. In this news article about the study, one author describes the restaurant industry's "race to the bottom" with regard to treatment of their employees. A copy of the study, as well as similar data for other metropolitan areas, can be found here.

Another Study Confirms Rampant Wage Theft Among Low Wage Workers

A study recently released by the UCLA Institute for Research on Labor and Employment examined the frequency of labor and wage abuses against low-wage workers in the Los Angeles area. According to the study, a substantial portion of Los Angeles County workers at the bottom of the labor market are the victims of wage theft and other workplace violations, which on average deprive workers of 12.5 percent of their weekly paycheck. Approximately 88 percent of those surveyed reported at least one instance of being paid less than the minimum wage, working overtime and not being paid for it, working off-the-clock for free, or other pay-based violations during the previous work week. More than 30 percent of those surveyed were being paid less than the legal minimum wage for California, or $8/hour. A complete copy of the study is here.

FLSA Compliance Myths Debunked

This article contains a nice summary of a number of common myths regarding the FLSA's overtime requirements. Among the myths discussed: 1) salaried employees are not eligible for overtime; 2) employees can agree to work overtime without overtime pay; 2) managers and supervisors are not entitled to overtime; and 4) in calculating overtime hours, it is acceptable to average work hours over two weeks.

Houston Restaurants Settle Overtime Claims

As described in the attached article, five Houston restaurants have agreed to pay $334,000 in back wages to 154 employees as a result of investigations by the United States Department of Labor. The investigations concerned the failure to pay overtime to workers.

Nobu Sushi To Pay $2.5 Million to Settle Tip Claims

Lawyers recently asked a court to approve a $2.5 million class action settlement on behalf of 500 current and former employees of Nobu in New York. The lawsuit alleged that Nobu improperly required servers to share their tips with sushi chefs and management employees,

Employment Law Issues Top List of Corporate Concerns

For the sixth consecutive year, labor and employment disputes topped the list of of legal worries for United States companies according to Fulbright & Jaworski's 2009 Litigation Trends Survey. The two biggest concerns were discrimination claims and claims under state and federal wage and hour laws.