Holiday Season Brings Wage and Hour Challenges

As if the holiday season weren’t stressful enough with all the shopping and cooking to be done, HR professionals also must deal with a variety of wage and hour challenges. Be sure to check these five considerations off your list so that the holidays are nice, not naughty, for you and your employer this year.

1. Consider Whether Holiday Parties Count as Working Time

The time that nonexempt employees spend attending holiday parties typically will be considered compensable hours worked under the federal Fair Labor Standards Act (FLSA) and most state wage and hour laws if the employee is required to attend or if the parties are scheduled during the employees’ regular working hours.

Employers that wish to avoid paying employees to attend the annual holiday party should be sure to schedule it outside regular work hours and to make it abundantly clear that attendance is voluntary. Merely stating that attendance is voluntary on the invitation may not be enough. If managers encourage employees to attend, or if important work matters are discussed, a court or enforcement agency could conclude attendance was not optional and therefore employees should be paid for time attending the party.

2. Watch Out for State Laws

Federal law does not require that employers give employees the day off on any holiday, nor does it require that employees be paid overtime for working on a holiday (unless, of course, working on a holiday means they worked more than 40 hours in a workweek).

However, some states require that certain employers provide certain employees with time off on Christmas and/or New Year’s Day. And Massachusetts and Rhode Island require that certain employees be paid overtime if they work on those holidays (regardless of whether they worked more than 40 hours in a workweek).

State day of rest laws may also come into play if holiday workloads make it necessary for employees to work six or more days consecutively, or six or more days in a week. State show-up time/reporting time laws may further complicate matters if unpredictable staffing needs result in employees reporting for duty without being provided a full shift’s worth of work.

3. Prepare for Minimum Wage Increases

Be aware that many states and municipalities have minimum wage increases that are scheduled to take effect on December 31, 2017, or January 1, 2018. For some of these, compliance involves little more than a change in the rate of pay. However, there can be complications. For example, many states and municipalities now have minimum wage rates that vary depending on the size of the employer. If your company has grown or shrunk during this year, your organization may find itself in a different tier.

4. Correctly Classify Seasonal Workers

During the busy holiday season, some employers may hire seasonal help. Just because these jobs are typically short in duration doesn’t necessarily mean that the workers may be classified as independent contractors. If the worker should be classified as an employee, it’s also important to determine whether the worker is an employee of your company, of the third-party staffing firm or jointly employed.

5. Don’t Forget Scheduling Laws

With the holidays in high gear, many employers – especially those in the retail and hospitality industries – need all hands on deck. Heightened customer demand and workloads may require that employees work longer hours and take on shifts outside their usual schedules. In general, federal law allows an employer to change employees’ work schedules without providing prior notice or obtaining consent (with the exception of collective bargaining agreements and child labor restrictions).

But certain big municipalities – San Francisco, San Jose, Seattle and, most recently, New York City – have adopted laws that limit how and when employers can change employees’ schedules. Meanwhile, Oregon passed the first statewide scheduling law, which will take effect next July. Many other cities and states are considering similar legislation. Employers should prepare to comply.


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