Out-of-Office: 24-7 Accessibility May Mean Overtime Liability

Out of Office Blog Photo

Nothing puts a damper on your time off quite like the smartphone chime or buzz that signals the arrival of another work e-mail in your inbox. Welcome to the age of 24/7 accessibility!

The use of mobile devices to stay “connected” outside of regular business hours has become increasingly common. You could even argue that after-hours accessibility—whether through a company-provided device, an employer’s “bring your own device” policy, or simply using a personal device for work-related tasks—is making some people essentially on-call employees.

This isn’t just an issue for employees. After-hours accessibility may come at a big cost to employers if they find themselves faced with overtime violations for failing to properly track and compensate employees for all of their “work away from work.” 

The Newly Overtime-Eligible

The issue of whether and how to pay employees for time spent working after-hours via smartphone is ripe for litigation, particularly in light of the new overtime regulations released by the Department of Labor this past month, which raised the salary threshold above which executive, administrative, and professional employees may be exempt from overtime pay requirements under the Fair Labor Standards Act.   

Approximately 4.2 million additional employees will be covered by the FLSA’s overtime protections once the new regulations go into effect Dec. 1—meaning that those employees may now be entitled to time-and-a-half pay for any of those e-mails that they send and receive while off duty.

The DOL has announced that it will be putting out a request for information, likely this month, in which it will solicit information regarding the impact of smartphones on the working hours of overtime-eligible employees.  Hopefully, the RFI will lead to more substantive guidance for employers regarding what qualifies as compensable time.  In the meantime, however, what should employers do to mitigate their potential liability for overtime violations?

Limit Legal Risks

In a recent presentation at the Society for Human Resource Management’s Annual Conference and Exposition, Joseph L. Beachboard, Senior Partner at Ogletree Deakins, advised employers that they should take certain precautions when it comes to allowing employees to use their smartphones for e-mails and calls outside of working hours.  I caught up with him after the conference to discuss some of his recommendations.

Beachboard suggests that every employer make a threshold determination as to whether nonexempt employees (that is, those that are entitled to overtime pay) really need remote, off-the-clock access and, if so, what kind.  “You need to think about the needs of your business, and you need to react to those needs in a way that limits your legal risks,” he said.  If the employer determines that its nonexempt employees don’t particularly need after-hours access, it should simply refrain from issuing company devices to those employees and should restrict their access to e-mail systems that could be reached using their personal devices.

For those nonexempt employees who do need to be accessible by e-mail after hours, the question for employers is whether to limit the extent of their access, according to Beachboard. If, for example, an employer only foresees an infrequent need for overtime e-mail usage (such as the occasional large project), it should institute a policy requiring prior supervisory approval for after-hours e-mail usage.

Track and Pay for Work

Policies explicitly stating the need for employees to accurately track all of their after-hours working time are essential, as is the obligation to pay employees for any and all overtime work they perform.  And, if employees fail to abide by those time-tracking policies, they should be subject to disciplinary action, Beachboard said.  This may sound counterintuitive to some employers, as most would typically want to reward employees who are willing to put in extra work.  But, in the interest of mitigating risk and enforcing a policy of reporting all compensable time, employers should be prepared to discipline those employees that don’t accurately track and report their time, he said.

Regardless of which path an employer takes, supervisors must be trained on both the applicable policies regarding after-hours e-mail usage and the reasons underlying those policies, Beachboard said. Employers need to foster an environment in which employees are encouraged to report after-hours work to their supervisors, he added.  “People should understand that we want to pay them for their time, and supervisors have to be supportive of that.”

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