The recent Groupon overtime lawsuit is a good example of the care companies must take to follow FLSA regulations.
Groupon has quickly grown their sizable company to almost 10,000 employees. But because they were careless in their payroll practices, their future is bleak.
About 1,050 past employees are now in the process of a couple of class action overtime lawsuits. If the lawsuits prove valid, this could cost the company big. Depending on individual awards, the payouts themselves could exceed $2 million.
We get calls all the time from customers who want help setting up the overtime rules inside our software. They explain that they would like to customize the defaults to suit their company’s policies. I have heard a gamut of creative solutions for calculating overtime. While having secondary or even tertiary pay rates is great employee incentive, employers must understand that there are federal laws governing overtime pay. Overtime policies cannot be tailored from company to company.