Wage & hour attorneys' offer their best tips for staying out of trouble. As federal court filings of wage and hour class and collective actions are skyrocketing, top attorneys offer tips on compliance. Attorneys review 2013 national wage and hour litigation trends to help avoid lawsuits.

1. Wage & Hour Attorneys’ Best Tips for
Staying Out of Trouble
Featuring Seyfarth Shaw LLP

2. Welcome
Today’s Host
Michelle Lanter Smith
Vice President of Marketing
EPAY Systems, Inc.
mlsmith@EPAYsystems.com
773-499-7512
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3. EPAY Systems -- designed to meet the
needs of your complex,
distributed workforce
• Reduce your labor
costs by 5% or more
• Keep you in control
and in compliance
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4. Today’s Discussion
Federal court filings of wage and hour class and collective
actions have increased more than 500% since 2000.
Are you at risk?
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5. Our Speakers
Noah A. Finkel
Partner, Seyfarth Shaw LLP
Labor & Employment
nfinkel@seyfarth.com
(312) 460 -5000
Rebecca P. Bromet
Partner, Seyfarth Shaw LLP
Labor & Employment
rbromet@seyfarth.com
(312) 460 - 5000
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6. Ask Your Questions
To ask a question, simply
type your question in the
“Question” box on the right
side of your screen.
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7. Overview: Trends for 2013
• Litigation trends
o Continued aggressive plaintiffs’ bar
• Increased agency enforcement
• FLSA exemptions
o Administrative exemption
o Executive exemption
• Regular Rate of Pay
o Calculating overtime properly
• Off-the-clock work
o Donning & doffing
o Travel time
o BlackBerries and PDAs
©2012 Seyfarth Shaw LLP
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8. National Wage & Hour
Litigation Trends
• Aggressive plaintiffs’ law firms have created consortiums, jointly
filing class/collective suits
• In recent years, plaintiffs’ firms have employed an industry-specific
approach when it comes to wage & hour litigation
o One firm successfully targets an industry and is quickly followed by
other plaintiffs’ firms who target other employers in that industry
• Aggressive outreach efforts to identify potential plaintiffs
o Outside companies sending email blasts to employees of target
companies
o Ads on Facebook, Twitter
• 7064 lawsuits filed under the Fair Labor Standards Act (“FLSA”) in
2012
o Record high number
o State wage-and-hour actions raise this number significantly
o Of all state and federal class or collective actions filed in the
U.S., vast majority are wage and hour claims
©2012 Seyfarth Shaw LLP
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9. Top 10 Private W&H
Settlements in 2012
1. $99 Million – Novartis (misclassification of pharma sales reps)
2. $40 Million – Merrill Lynch (wage claims related to merger)
3. $35 Million – H&R Block (timeliness of payments)
4. $21 Million – Rite Aid (misclassification of ass’t store mgs)
5. $20 Million – City of New York (misclassification of police sergeants)
6. $19 Million – Robert Half (misclassification of recruiters)
7. $15.6 Million – HSBC Bank (misclassification of
bankers, managers, & specialists)
8. $15.5 Million –Conoco Phillips (failure to provide meal breaks)
9. $14 Million – Family Dollar (misclassification of store managers)
10. $12.9 Million – Spearmint Rhino Cos. Worldwide, Inc. (independent
contractor misclassification)
©2012 Seyfarth Shaw LLP
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10. FLSA Cases in Federal Court
1993-2012
©2012 Seyfarth Shaw LLP
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11. WHD Continues To Be Aggressive
• Increase in targeted investigations in low-wage/high risk industries
• Increase in corporate-wide investigations
• Assessment of liquidated damages, penalties, and other sanctions
• Grass Roots Campaign:
o Continued push of “Bridge to Justice” and “We Can Help”
 Partnering with community and worker organizations to increase employee
awareness
 Referring certain cases to private attorneys to initiate litigation
©2012 Seyfarth Shaw LLP
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12. Increased WHD Enforcement
Capabilities
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A p p l i e d E c o n o m i c S tr a te g i e s , u s i n g U .S . D e p a r tm e n t o f L a b o r , W a g e a n d H o u r D i vi s i o n d a ta .
©2012 Seyfarth Shaw LLP
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13. Mistake #1
• They are office workers and receive a
salary, so they are not entitled to overtime
• Key issues:
o Whether the employee primarily performs office or non-
manual work directly related to the management or
general business operations of the employer or the
employer's customers ((Inside) Sales = production work
o Whether the employee exercises discretion and
independent judgment with respect to matters of
significance in the performance of their primary duties
©2012 Seyfarth Shaw LLP
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14. Mistake #2
• We call them “manager,” so they are not
entitled to overtime
• Key issues:
o Recommendations for hiring/firing given particular weight?
o Too much work like those who are supervised?
o Sufficient pay distinction between hourly employees and
manager
 Easy case to certify as a collective/class action.
©2012 Seyfarth Shaw LLP
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15. Mistake #3
• “They work a lot with computers, so
they are exempt”
• Key issues:
o Computer employee exemption actually is quite
narrow
 developers, designers, certain testers
o Administrative exemption can apply, but is work too
technical? Or, are there right-and-wrong answers?
o Beware of state law – this exemption is not available
in all states or may be defined differently
©2012 Seyfarth Shaw LLP
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16. Mistake #4
• Not including all required compensation in
the regular rate for purpose of calculating
overtime compensation (easy to certify)
• Key issues:
o Shift differentials, on-call payments, commissions
o Bonuses included unless, purely discretionary, or
percentage of total (including overtime) earnings
o Certain types of pay for time not worked can be
excluded if paid at a premium rate
©2012 Seyfarth Shaw LLP
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17. Mistake #5
• Failure to take a strong stand against off-
the-clock work
• Key issues:
o Failure to properly compensate for all hours worked =
most frequently cited violation by WHD (in terms of
numbers of employees affected) in the course of its
investigations
o A number of states have recently enacted anti-wage
theft laws
o What can be done?
 Strong policies, training of management and employees
©2012 Seyfarth Shaw LLP
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18. Mistake #6
• Not including all required time in the
calculation of hours worked
o Pay for pre- and post-shift activities (donning & doffing;
computer boot up, etc.)
o Is the activity “integral and indispensable” to
employees’ principal work activities (and therefore
compensable)?
o Do the employer’s rules or the nature of the work
require it?
o Waiting to work- you don’t have to exert yourself to be
working
o Is the time de minimis (and can you count on this)?
o If an employee continues to work voluntarily after the
end of his shift and the employer knows or has reason
to know, that time is considered working time
©2012 Seyfarth Shaw LLP
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19. Mistake #7
• Not paying for time spent working outside of
normal hours on phones & computers
• Key Issues:
o Does the employer require the use of phones after hours?
o Are employees required to check and respond to email?
o Do employees record this time?
o How are employees paid for this time?
©2012 Seyfarth Shaw LLP
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20. Mistake #8
• Not paying for travel time
• Key Issues:
o Home to work, or vice versa, typically is not
compensable
o Between job sites is compensable
o Complex rules for out-of-town travel
o State laws add a twist
©2012 Seyfarth Shaw LLP
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21. Mistake #9
• Not paying trainees or interns
o Interns are employees unless:
 similar to school training or for educational credit
 for the benefit of the employee
 no displacement of regular employees and closely
supervised
 employer gains no advantage and operations even impeded
 no entitlement to job at end
 understanding that no wages owed
©2012 Seyfarth Shaw LLP
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22. Mistake #10
• Not auditing pay practices & exempt status
• Key Issues:
o Has the company reviewed its pay practices?
o Has the company reviewed its exempt status classifications
o Compliance with state laws?
o Conducted at the direction of counsel to establish privilege?
©2012 Seyfarth Shaw LLP
22

23. EPAY Systems
Michelle Lanter Smith
Vice President of Marketing
EPAY Systems, Inc.
23

24. EPAY -- In Time with You
Complex pay rules?
Mobile workforce,
union contracts,
multiple job assignments?
No problem!
Uniquely flexible
24

25. Reduce your labor costs
Eliminate erroneous Biometric time clocks
pay with camera and
calculations, time finger print reader
rounding, Eliminate buddy
and management punching
inconsistencies
Reduce payroll
administration time
25

26. Minimize Compliance Risk
• Audit Trails
• Overtime
• Meal Breaks
• Pay Differentials
• Privacy and Security
• Reduce Workers
Comp Claims
• Did you have an
accident free day?
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27. Over 40,000 customer sites
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28. Easy, Anywhere Time Tracking
Blueforce adapts
to how YOU
do business
28

29. Upcoming Education
• Public Demonstration: Time & Labor
Management for the Distributed
Workforce. Feb 14: 10:00 cst
• New Time & Attendance Technologies for
Tracking the Mobile Workforce Webinars.
March 7: 10:00 cst
Register at
www.EPAYsystems.com
29

30. Upcoming Education
Compliance Webinar Series with Seyfarth Shaw LLP
• How to Avoid Costly Wage & Hour Pitfalls for
Construction, Engineering, and Landscaping Employers. March 13: 12:00
cst
• How to Avoid Costly Wage & Hour Pitfalls Employers in the Staffing and
Security Industries. May 8: 12:00 cst
• California Wage & Hour Labor Law--Avoiding Common Pitfalls with a
Distributed Workforce. June 26: 12:00 cst
• How to Avoid Costly Wage & Hour Pitfalls for Healthcare Employers with a
Distributed Workforce. Sept 25: 12:00 cst
• How to Avoid Costly Wage & Hour Pitfalls for Employers in the Hospitality
Industry. Nov 6: 12:00 cst
Register at www.EPAYsystems.com
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31. Thank You!
Noah A. Finkel
Partner, Seyfarth Shaw LLP
Labor & Employment
nfinkel@seyfarth.com
(312) 460-5913
Rebecca P. Bromet
Partner, Seyfarth Shaw LLP
Labor & Employment
rbromet@seyfarth.com
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33. Thank You!
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