Balancing Labor Costs And Wage-Hour Laws

Employers' continued struggles with labor costs have led to additional hourly-rate cuts, salary reductions, furloughs, layoffs, and similar conventional measures.  But are there other potentially less-disruptive and legal options?  There might well be.

What Does The Law Really Require?

For one thing, management should purge pay plans and policies of any expensive misconceptions about what the law does and does not require.  For instance, some employers believe that non-exempt employees' unworked paid-time-off for holidays, sick days, or even vacation days must be counted as hours worked when computing overtime under the federal Fair Labor Standards Act.  This is not so, and eliminating this unworked paid-time-off from FLSA overtime calculations could result in appreciably lower wage costs.