Demanding work comes in waves. Maybe it’s peak business season. (Surf’s up, sales team!) You could be overloaded and working to wrap up sales for the quarter — or maybe you’re simply short staffed. You’re treading water and you need all of your employees on board to help. Whatever the reason, you need your employees to work overtime.
As an employer, you know that your employees may not be totally stoked about the extra hours. You may be wondering about implementing mandatory overtime. We hear these questions a lot. Can a company make overtime mandatory? Is mandatory overtime legal? We’ve laid out the rules, potential risks and best practices when it come to mandatory overtime.
Can a Company Make Overtime Mandatory?
Yes, but you’ll have to pay for it. Working overtime is when an employer requires their staff to work more than the normal 40-hour work week. An employer is in charge of creating and modifying schedules, which can include overtime. But that comes at a price.
Know that this isn’t a one-size-fits-all approach – the rules vary between your employees. Nonexempt employees must be paid for the overtime. Salaried employees can be asked to work mandatory overtime they don’t need to be paid extra. Their hours are flexible and all contained within their salary. It comes down to whether the employee is exempt or nonexempt.
Mandatory Overtime Rules for Nonexempt vs. Exempt Employees
Non-exempt employees are usually paid an hourly wage or earn a salary that’s less than a minimum amount determined by the DOL. If employees are non-exempt, it means they are entitled to minimum wage and overtime pay when they work more than 40 hours per week.
Nonexempt employees must receive overtime pay. These employees are protected under The Fair Labor Standards Act (FLSA.) They’re legally entitled to extra compensation for overtime work. To calculate their overtime rate, they must receive 1.5 times their regular rate times all overtime hours worked – known as the “time and a half” rule.
Exempt employees typically must be paid a salary above a certain level and work in an administrative, professional, executive, computer or outside sales role. The Department of Labor (DOL) lists the criteria that can help employers determine who meets this exemption criteria.
Exempt employees do not need to receive overtime pay. According to the FLSA, the qualifications of exempt employees are that they make at least $684 per week in a salaried position. This means that they will receive the same paycheck whether they work 40 hours a week or more.
Is Mandatory Overtime Legal?
Yes, employers do have the ability to make their employees work overtime. The Fair Labor Standards Act (FLSA) establishes a 40-hour work week but doesn’t cap the maximum working hours. Employers can also terminate an employee for refusal to work the mandated overtime. Still, you don’t want to be that boss. (Have we learned nothing from Office Space?) Consistently overloading your employees with extra hours will likely lead to burnout and, what’s worse, you could end up with a mutiny on your hands.
Know that exempt employees may be protected from overtime work through their employment contract or collective bargaining. Before scheduling exempt employees, be sure to double-check their contracts to avoid any conflicts.
Risks of Mandatory Overtime
Religious Discrimination Cases
When you force your employees to work overtime, be prepared for employees to request exceptions. Religious accommodations (such as not working on the employee’s Sabbath) and disability accommodations do have to be provided. Ignore religion in the workplace and you could be looking at a religious discrimination case. You’ll need to understand religious exemptions and how to navigate them when implementing mandatory overtime.
Depending on the circumstances, employees could also be excused from the extra work hours through a leave law. A great example of this would be employees on leave related to the federal Family and Medical Leave Act (which applies to employers that have 50 or more employees).
Mandatory Overtime: What To Prepare For
Before you go ahead and pencil in all of your employees to work 60 hours next week, there are some things you should know. Employers do have the power to schedule overtime, but with great power comes great responsibility. (Thanks for the advice, Spider-Man.)
Remember, work-life balance is crucial to your employees! Mess with that balance, and you could be left with a significantly smaller workforce. (Don’t forget about the mutiny!) If you truly have to have your employees work mandatory overtime, you’ll want to follow best practices.
Here are some things to consider:
- Give plenty of warning. Although it’s not required, you should give your employees a heads up if you’re going to need them to stay late. This way they can arrange their plans and prep their family at home if needed.
- Scheduling conflicts. Some employees may have commitments they can’t change that would make them unable to work the extra hours. If you plan to make the extra work a requirement for certain positions, you may experience unwelcome turnover.
- Employee burnout. Working overtime and excessive hours can lead employees to burnout. If you need them to work overtime, consider giving them the next day off or other schedule adjustments to make up for it.
- State laws. Labor laws vary among different states. For example, some states have a limit to how many hours can be worked in a day.
Thinking of Implementing Mandatory Overtime? HR Can Help
Mandatory overtime requires some serious compliance knowledge. An HR expert can help you navigate you the regulations of overtime work. Compliance demands placed on your business can be confusing and time-consuming. HR professionals keep you compliant with state and federal labor laws and protect your employees and keep them happy.