There’s a controversial and problematic illegal overtime substitute known as “comp time.” This is often a workaround non-governmental employers use to avoid paying employees overtime wages, and it violates the Fair Labor Standards Act (FLSA). We’d like to call some attention to this practice because you (or a colleague) may experience the effects of this fraudulent loophole, which can cost you dearly in unpaid wages.
Why Do Companies Try to Offer Comp Time?
Compensatory time is the practice of paying employees with subsequent time off work whenever they work over 40 hours a week. This is an illegal way of averting the FLSA’s requirement to pay employees an overtime premium when they work more than forty hours per week. Employers do this because it reduces their payroll burden not to have to pay an employee the mandatory overtime premium (even if they lose the employee’s services the following week with comp time).
How frequent is this practice? It’s hard to pinpoint an exact figure, but some anonymous surveying shows that roughly ⅓ of employers admit to offering (or coercing) employees with compensatory time. We can imagine this figure to be way higher by including all those who won’t admit to doing it.
Is Comp Time Ever Legal?
It’s only legal for a public employer such as a government to offer compensatory time for employees. The reason for this is that public employers such as federal, state, and local governmental entities have some different overtime payment rules. You should contact an employment attorney if you are a government employee who believes he or she is losing overtime wages.
It is NOT legal for a private employer to suggest or require employees to sign a document that states that the employee agrees to accept comp time instead of payment for overtime hours. It is illegal for an employer to require employees to sign any such document. Employees are entitled to overtime pay for hours that exceed forty hours per week. Employers cannot get around this by making employees sign anything which negates this.
The reason we talk so much about overtime hours is that they carry a substantially different wage than normal hours (time-and-a-half versus your regular wage). Thus, employers most often try to cheat employees out of overtime pay because of its increased value,
Penalties for Unlawful Use of Compensatory Time?
What could happen to an employer that gets caught failing to pay overtime or substituting it with compensatory time? There are several penalties for violating the FLSA, and other state and federal wage laws.
First, employers must pay for all unpaid overtime for up to three years backward. Second, employers who willfully violate the FLSA and/or state law must pay liquidated damages which can double the unpaid overtime amount. Third, if you have to go to court against an employer, and win the case, the employer must also pay your legal fees and litigation costs.
Finally, employers could suffer even further punitive backlash if they retaliate or discriminate against an employee. All of this means that they have a serious incentive to avoid this practice, but many continue doing it because they’re not met with significant opposition. Our mission at Rowdy Meeks Legal Group LLC is to reverse that trend, help you gain restitution, and hold employers accountable to the law.
Finally, it’s important to never allow the jargon and employment law details to intimidate you. It may seem overwhelming, but we have plenty of resources to help you learn about recovering unpaid wages, and we’re always here for legal advice.
Fight Back Against Unjust Wage Withholdings with the Rowdy Meeks Legal Group LLC
You don’t have to be a victim of sneaky evasion tactics when you’re only trying to earn a just wage. Rowdy Meeks Legal Group LLC dedicates lots of time and effort to prosecuting unpaid wage cases where hourly workers experience unlawful wage situations including employers offering compensatory time.
Even if you aren’t sure whether you have an actual case, it never hurts to reach out to us for a free consultation. We’re always happy to help you determine whether you’re eligible to receive compensation for unpaid wages including overtime.
Contact Rowdy Meeks Legal Group LLC if you have questions or concerns about suspicious comp time practices at your job or any other unpaid wages claim.