On February 24, Mama’s Pizzeria and Restaurant of Copiague, New York entered into a settlement with the Department of Labor. In the settlement, Mama’s agreed to pay $780,000 in minimum wage and overtime compensation to 40 employees.
Mama’s was charged with paying employees wages less than the minimum wage and requiring employees to work more than 40 hours per week without paying overtime. Mama’s also failed to keep accurate records of wages paid and hours worked by employees.
This case serves as a warning and opportunity for employers to review who is entitled to overtime and what records must be maintained by a business.
Virginia businesses follow the Fair Labor Standards Act (“FLSA”) with regards to overtime and minimum wage standards. The FLSA specifies that employees required to work more than 40 hours in a week are entitled to overtime at a rate no less than 1.5 times the normal hourly rate. Additionally, certain employees are exempt and not entitled to overtime.
The types and number of jobs that are exempt is lengthy. Jobs that are of particular relevance to Virginia include:
- Administrative employees
- Professional employees
- Outside salesmen
- Seasonal employees under certain conditions
- Switchboard operators
- Babysitters, companions, and other “domestic service employees”
- Some technology employees when certain conitions apply – computer system analyst, computer programmer, software engineer
- Commissioned retail/service employees
- Delivery drivers who receive “trip” rates
The FLSA and associated regulation also defines what types of employee records employers are required to maintain. Below are some of the highlights:
Records that must be kept for three years
- Payroll Records.
- Certificates, agreements, plans, notices, etc. – this includes employment agreements, summaries of any oral agreements entered into with the employee and any collective bargaining agreements.
- Sales and Purchase Records for the business.
Records that must be kept for two years
- Basic Employment and Earning Records: timesheets or other method used by employee to track the time worked.
- Rate tables used by the employer in the calculation of piece rates and overtime.
- Copies of customer orders and invoices received and sent.
- Records of additions and deductions to wages paid to employees.