December 1, 2000

Avoiding Lawsuits is a service of the employment law training and consulting firm of Counsel Consulting Group LLC and the law firm of Powell, Trachtman, Logan, Carrle & Lombardo, P.C.

THREE OVERTIME NIGHTMARES

Most employers understand their basic obligation to pay overtime compensation. They know there are "exempt" employees to whom overtime requirements do not apply (commonly, albeit erroneously, understood to encompass only professionals and executives); and they know there are "non-exempt" employees to whom overtime requirements do apply (commonly, albeit erroneously, understood to encompass only hourly workers). But like so many other things in the law, a little knowledge can be exceedingly dangerous. The overtime requirements of the Fair Labor Standards Act are convoluted -- and in some instances unimaginable -- and over the last several months we have seen various companies slammed by FLSA audits, often brought forth by a telephone call from a disgruntled employee to a governmental authority. FLSA violations can result in huge back pay awards and penalties.

As is usually the case, prevention is the key. Consequently, many clients retain us to do FLSA "audits," which involve a preventive analysis of the company's overtime payment policies in the effort to forestall costly mistakes. Do you need such an audit? Consider the following three "disasters waiting to happen" scenarios, each of which is becoming more commonplace. If any of these gives you pause, perhaps its time to consider a more aggressive and proactive review of your company's payroll practices.

Powell, Trachtman, Logan, Carrle & Lombardo, P.C. is a full service law firm with offices in suburban Philadelphia, PA, Harrisburg, PA and Cherry Hill, NJ. Powell Trachtman represents a variety of commercial enterprises, entrepreneurs and business executives in respect to their litigation, litigation avoidance planning, business formation, business transactions, estate and tax planning, and other needs. We are also approved defense counsel for numerous insurance carriers in matters pertaining to professional malpractice, products liability, employment practices, directors and officers liability, and many other fields. For more information, contact us at info@powelltrachtman.com and visit our website at www.powelltrachtman.com.

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