labor lawAdivision of labor law center

If you are an employer that frequently expects your employees to work for more than 40 hours a week, you should take care that you do not violate the federal and Connecticut overtime laws.

The US Dept of Labor brings employers attention to the Fair Labor Standards Act (FLSA) which covers how employees should be paid when they work over 40 hours per week.

According to the FLSA, employees who work more than 40 hours per week are entitled to overtime payments of 1.5 their normal hourly rate, for each hour they work over 40 hours. But problems can occur when employers do not take employee incentives into account when calculating overtime payments.

This is what happened to Wal-Mart, Inc., and the US Dept of Labor recently announced that the company has agreed to pay more than $33 million in back wages to employees, to comply with the federal and Connecticut minimum wage laws.

It was found that Wal-Mart violated the Connecticut overtime laws. The company did not take incentive or premium payments into account when calculating over time payment for many of its employees over a period of time from February 1, 2002 and January 19, 2007.  The back payments that Wal-Mart has agreed to pay effect around 86,680 employees.

According to the Fair Labor Standards Act, if an employees’ basic rate is $6.00 per hour, but with incentives they usually earn $7.00, then the overtime payment should be calculated on 1.5 times the $7.00 per hour and not the $6.00 per hour basic. Wal-Mart calculated the overtime payments on the basic hourly rate, and did not take incentives into account.

The Dept of Labor files a compliant against Wal-Mart in the US District Court. This covered the violation of the FLSA overtime payment provision, as well as infringements of the state minimum wage laws. 

Wal-Mart has agreed to pay not only the back wages, but also interest on the money. 

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