Employment Law

Wage and Hour Violations May Increase During Uncertain Times

Business owners face many challenges on a daily basis. During uncertain times, these challenges become even more prevalent. Right now, thousands of businesses across the country are struggling. Many are considering ways to earn a profit or maintain their operations during a global pandemic. Even after the spread of COVID-19 has been controlled sometime in the future, many of the real economic challenges will begin. 

Although everyone is dealing with challenges right now, employers must be mindful of complying with federal and state wage and hour laws. Just like employers have a right to earn a living through owning a business, employees have a right to be paid for their hard work. A Tampa wage and hour attorney will discuss several of the pitfalls facing businesses during uncertain times. 

COVID-19 Is Reshaping Industries

COVID-19 is shaking up business operations and consumer behavior. Along with government-mandated shelter-in-place orders, the COVID-19 pandemic is set to offset a lot of opportunities for traditional businesses. Currently, employers are dealing with disrupted supply chains, missed partnership opportunities, and stalled business deals. Even worse is a consumer shift to online alternatives that can threaten the long-term viability of these businesses. 

Restaurants and Retail Stores Hit the Hardest

Restaurants, retail stores, and brick-and-mortar stores have lost out on billions of dollars collectively from social distancing requirements. Consumers have cancelled trips and nights out on the town, and all large gatherings have been postponed. As the economic damage is mounting across the nation, restaurants and retail stores will face some of the biggest challenges to recover. Unfortunately, restaurants and retail stores have also been the primary culprit of wage and hour violations in the past. As these industries take a massive loss in 2020, it’s fair to say that wage and hour violations could potentially occur more frequently within these industries.

Related: Can an Employee Waive Their Wage and Hour Rights?

Our Tampa wage and hour attorneys explain why:

Reeling Finances: The full economic impact of the pandemic hasn’t been felt yet, but it’s safe to say that it will have a drastic impact on restaurants, retail stores, and the vast majority of businesses. Even before the spread of COVID-19, several restaurant chains were filing for bankruptcy. Now many of the largest restaurant groups are acknowledging that they’ll need to negotiate the terms of their lease agreements, and that’s the best case scenario. Small businesses will be hit even harder now that federal loans have been dispersed and many of these businesses did not receive the funding they had hoped for. With reeling finances, employers will have to look at ways they can effectively reduce payroll expenses. 

Shifting Business Needs: Many employers have been forced to invest capital into their business to accommodate the current social distancing requirements. For example, restaurant owners upgraded their delivery services and curbside pickup options. Some common investments right now include website and app upgrades, buying more to-go products (such as containers, bags, cups, plates), and extending business hours to offer lunch and dinner options from 11am to 10pm. It will also take these businesses significant time to shift their operations to accommodate current demand.  

Reducing Staff: As everything but essential businesses have closed this April, employers that can’t transition their essential tasks to telework are either terminating employees or placing them on standby. Many companies are adopting unpaid leave policies to retain workers for the long term and some employees are preferring to stay home to avoid infection. Whatever employees are left will need to fill business needs.

Extending Hours: Naturally, with a reduced staff and potentially longer hours of operation, many employees will be required to work longer hours to meet the demand. With the exception of nonexempt workers, any workers that work over 40 hours in a workweek should be compensated one-and-one-half times their standard hourly rate. So if you’re working 60 hours a week during a pandemic, you should be compensated your regular 40 hours, plus 20 hours with overtime pay.

Related: Florida Overtime Laws 

A Warning for Employers

We understand that this current predicament is especially challenging for business owners, and we know that the future months only offer more uncertainty. However, federal and state wage and hour laws were enacted for a reason. Employees deserve full compensation for their hard work. Here are a few final pieces of advice for employers from a Tampa overtime lawyer: 

• Pay every employee for every hour that they work.
• If an employee works over 40 hours a week, pay them overtime.
• If you would prefer not to pay employees overtime compensation, reduce their hours and schedule more employees to work each workweek.
• Never replace hourly employees with volunteers.
• Never pay employees below minimum wage.
• Never misclassify workers. If you move a tipped employee (bartender or server) into a non-tipped position (cook, etc.) to meet business demands, their hourly pay should shift to the minimum wage requirements of their position.
• Pay employees for mileage. If a worker has to drive their own vehicle for deliveries, they should be compensated for their mileage. 

Employees need to also be mindful of these considerations and track their time accordingly. If you are owed additional compensation, we are standing by.  

If you would like to speak with our Tampa overtime lawyers, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.