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Work Hours and Overtime Compensation Policy - 12 Month Staff

Work Hours and Overtime Compensation Policy - 12 Month Staff

Authority: 
Business Affairs and University Services
Date enacted or revised: 
December 1, 2012; Revised August 2016


PURPOSE
 
The purpose of this policy is to ensure that scheduled work hours are established for all 12 month Administrative Staff and Classified employees and that compensation for work hours or related overtime is administered in accordance with the US Department of Labor/Fair Pay Rules and all applicable Louisiana state rules and regulations.
 
Reference:  US Department of Labor-Guidance for Higher Education
www.dol.gov/whd/overtime/final2016/highered-guidance.pdf
Reference:  Louisiana Department of Civil Service Overtime Rules
http://www.civilservice.louisiana.gov/HRProfessionals/HRHandbook/Chapter21.aspx
Reference:  University of Louisiana System Board Compensatory Leave Policy
http://ulsystem.edu/assets/docs/searchable/boards/FS-III.XX.-1%20Leave%20Record%20Establishment.pdf       
 
POLICY STATEMENTS
 
  1. All 12 month employees can be required to perform overtime as per Chapter 21 of the Civil Service rules, and the University of Louisiana System Board Policy# FS.III.XXI.-1.
  2. All employees should be “directed” by their supervisor to work overtime, and must have pre-approval to perform overtime whether the compensation is in the form of cash or compensatory leave.
  3. All university employees (state agency) can be required to accept compensatory leave in lieu of cash overtime as per the regulations of the Fair Labor Standards Act. 
  4. The university will compensate overtime in the form of compensatory leave unless mitigating circumstances or the nature of work warrant cash payments.
  5. All university employees are required to sign a Statement of Agreement/Understanding explaining the employer’s right to compensate overtime in the form of compensatory leave prior to the actual performance of work, or at the time of hire.
  6. All supervisors must ensure that their budget has funds delegated for the payment of overtime whether in the form of cash or compensatory leave.  Some compensatory leave is payable to the employee; therefore, compensatory leave payout is a budget liability.  It is simply “banked overtime”.
  7. Employees are not permitted to work at home without prior approval from the immediate supervisor, and the division/section/unit head.
  8. The university requires that all employees use compensatory leave before requesting the use of annual leave.  Payroll will automatically reduce the compensatory leave balance before reducing the annual leave balance.
  9. Faculty members do not accrue compensatory leave.
  10. Employees who work on an intermittent basis or WAE appointment may not accrue compensatory leave and must be paid cash overtime if applicable.
 
 
 
DEFINITIONS OF STATE AND FEDERAL OVERTIME
 
US Department of Labor Definition of Overtime (Fair Labor Standards Act)
 
Reference:
http://www.dol.gov/whd/overtime_pay.htm
 
The federal overtime provisions are contained in the Fair Labor Standards Act (FLSA).
Unless exempt, employees covered by the Act must receive overtime pay for hours worked over 40 in a workweek at a rate not less than time and one-half their regular rates of pay. There is no limit in the Act on the number of hours employees aged 16 and older may work in any workweek. The Act does not require overtime pay for work on Saturdays, Sundays, holidays, or regular days of rest, unless overtime is worked on such days.
The Act applies on a workweek basis. An employee's workweek is a fixed and regularly recurring period of 168 hours — seven consecutive 24-hour periods. It need not coincide with the calendar week, but may begin on any day and at any hour of the day. Different workweeks may be established for different employees or groups of employees. Averaging of hours over two or more weeks is not permitted. Normally, overtime pay earned in a particular workweek must be paid on the regular pay day for the pay period in which the wages were earned.
 
Rule 21.7 Definition of State Overtime
 
Reference:
http://www.civilservice.louisiana.gov/HRProfessionals/HRHandbook/Chapter21.aspx      
 
When employees work overtime hours that do not require compensation under FLSA, those hours are referred to as “State Overtime.” State Overtime is defined and governed by Chapter 21 of the Louisiana Department of Civil Service Rules.
 
State Overtime applies to non-exempt employees that work in excess of their regular workday or workweek under circumstances when FLSA does not apply. For example, FLSA does not apply to a non-exempt employee if the employee worked fewer than 40 hours in a week, including the overtime the employee worked outside of his regular work schedule because of leave taken or an observed holiday. In this case, State Overtime would apply to this non-exempt employee.
 
State Overtime also applies to exempt employees. Exempt employees are never eligible for FLSA overtime, so all overtime worked by exempt employees is State Overtime. The rules provide agencies with options to compensate exempt employees for State Overtime worked; however, the rules do not require overtime compensation for exempt employees.
When an employee is not entitled to overtime under FLSA, State Overtime is credited as follow:
  • In excess of the employee’s regularly scheduled work day. For example, an employee whose regularly scheduled work day is 8 hours earns State Overtime as soon as he has worked in excess of 8 hours. A non-exempt employee will earn FLSA overtime if this work, at the end of the week, has caused him to work in excess of his normal work period (i.e. 40 hours/week for most employees). For exempt employees, and for non-exempt employees who took leave during the week or observed a holiday during the week and thus did not work in excess of their regular work period, this time worked in excess of the employee’s regularly scheduled work day will be State Overtime.
  • In excess of the employee’s regularly scheduled work period. For example, work performed on an employee’s normal day off is State Overtime for exempt employees, and is State Overtime for non-exempt employees when it does not cause the employee to work in excess of his FLSA overtime period (i.e., 40 hours per week for most employees).
  • On a holiday, including a designated holiday. For example, a non-exempt employee who works on a holiday AND also works in excess of his regularly scheduled work period (40 hours/week for most employees) will earn FLSA overtime after the 40th hour has been worked. A non-exempt employee who works on a holiday, but does NOT work in excess of his regularly scheduled work period, will earn State Overtime only. Exempt employees are eligible ONLY for State Overtime, and thus, if they work on a holiday, they may earn State Overtime regardless of the number of hours worked.
  • During official emergency office closures. For example, an employee required to work during an official closure of his agency on a regular workday earns State Overtime. A non-exempt employee who works in excess of his regularly scheduled work period (40 hours in a week for most employees) will earn FLSA overtime. The non-exempt employee will receive State Overtime for work during an official closure and the exempt employee may receive State Overtime for work during an official closure.

STANDARD WORK WEEK AND WORK DAY
 
Each 12 month employee is designated as exempt or non-exempt from the Fair Labor Standards Act for the purpose of administration of overtime payments, if applicable to employment category.  This designation is provided to the employee and the supervisor at the time of hire.
 
Most 12 month employees have a standard workweek with time beginning at 12:01 am on Saturday, and ending at midnight on the following Friday, which is a 7 day/24 hour per day period.  There is an exception to the 7 day period for law enforcement only where the work week is comprised of a 14 day period.  Reference: www.dol.gov/whd/regs/compliance/whdfs8.pdf
 
Most 12 month employees, full time, have a standard workday of Monday-Friday from 7:45 am through 4:30 pm with a 45 minute lunch period, which is 8 hours per day and 40 hours per week.  Part time employees have a reduced number of hours worked each day which are recurring and established.
 
Certain employees have a different standard workday due to the needs of the department, and the employee is notified accordingly.  The Human Resource Office maintains the standard workweek and standard workday of all employees, and must be notified in writing of any deviation of the standard workweek or workday.  On-going or temporary flexible schedules must be approved by the department head, through the chain of command to the appropriate division head.  These flexible work schedules must also be filed in the Office of Human Resources to ensure accurate time keeping, leave accrual or use, holiday pay, etc.
 
The university requires that all individuals employed on a full time basis, other than shift employees, observe the lunch period unless business necessity requires otherwise.  Each employee should have a minimum 30-minute lunch period.
 
Employees who wish to remain at the workstation to have a lunch period should not be allowed to perform work.  To allow an employee to remain at the workstation could “suffer” them to work as they may be answering the telephone, opening the office, greeting customers, etc.  Each supervisor must ensure that no work occurs if the employee chooses to remain at the workstation to have a lunch period. 
 
If the employee works in an area that remains open due to departmental circumstances, the department should “shift” lunch periods, allowing employees to observe the lunch period at different times.  Compensatory leave should not be granted to employee’s for the purpose of allowing the office to remain open at all times during the workday without explicit written permission of the appropriate Division Head.
 
 Employees who arrive early to work because of choice should not be allowed to perform work until the actual start of their standard workday.  To allow an employee to arrive at work early could “suffer” them to work as they may be answering the telephone, opening the office, greeting customers, etc.  Each supervisor must ensure that no work occurs if the employee chooses to arrive at work earlier than scheduled. 
 
Work that occurs outside of the standard workday or workweek, even though it may be unauthorized, must be compensated whether or not supervisor permission is granted to perform the work.  An employee may be subject to disciplinary action if either unauthorized or unapproved work is performed. 
 
COMPENSATION/CAPS/PAYMENT FOR OVERTIME HOURS WORKED
 
Compensation for Non-Exempt Employees:
  1. For non-exempt employees, all FLSA overtime must be compensated at the time-and-one-half rate.
  2. Non-exempt employees must be compensated for State Overtime at the hour-for-hour rate, unless the Commission has granted an agency an exception to use the time-and-one-half rate, or time-and-one-half is allowed under subsection (c) and (d) below.
  3. During an official closure due to an emergency, an agency may choose to compensate non-exempt employees for State Overtime at the time-and-one-half rate instead of the hour-for-hour rate.
  4. On a holiday, an agency may choose to compensate non-exempt employees for State Overtime at the time-and-one-half rate instead of the hour-for-hour rate.
 
Compensation for Exempt Employees:
Agencies may choose to compensate their FLSA exempt employees for overtime hours worked in any one of the following ways:
  1. No overtime compensation. There is no requirement to compensate exempt employees for any overtime worked. An appointing authority may choose “no overtime compensation” for all exempt employees, or grant overtime compensation to one type of exempt employees but not to others. However, there should be a rational business reason for different treatment of employees, such as different types of work or levels of responsibility.
  2. Compensation at the hour-for-hour rate in the form of compensatory leave.
  3. During an official closure due to an emergency, overtime may be compensated at the time-and-one-half rate.
  4. With the Commission’s approval, overtime may be compensated at the time-and-one-half rate for classified employees.
 
Caps on Overtime Earned at the Time and One Half Rate (FLSA Overtime):
 
  1. Non-Exempt employees who accrue compensatory leave at the time and one half rate (FLSA overtime), shall not accrue more compensatory leave than what is allowed under FLSA provisions for such.  The cap on time and one half compensatory leave is 240 hours for regular employees, and 480 hours for law enforcement employees.
  2. Once the maximum or cap is reached, any additional work performed that exceeds the standard workweek must be paid in cash at the time and one half rate.
 
Caps on Overtime Earned at the Hour for Hour Rate (State Overtime):
 
  1. Non-Exempt employees-compensatory leave earned at the hour for hour rate may be accrued in excess of 360 hours, but no more 360 hours will be carried forward from one calendar year to the next unless an exception is granted by the Civil Service Commission to maintain essential services necessary to preserve the life, health, or welfare of the public.
  2. Classified exempt employees-compensatory leave earned at the hour for hour rate may not be accrued in excess of 360 hours.
  3. Unclassified exempt employees-compensatory leave earned at the hour for hour rate may not be accrued in excess of 30 working days in a fiscal year, and no more than 30 working days may be carried forward to the next fiscal year.
 
Payment or Cancellation of Compensatory Leave upon Separation or Transfer to another State Agency:
 
  1. Time and One Half Compensatory Leave
Upon separation or transfer from the university, all compensatory leave earned at the time and one half rate and credited to the employee must be paid in accordance with the provisions of FLSA.
  1. Hour for Hour Compensatory Leave
    • All unused compensatory leave earned hour for hour by exempt employees will not be paid upon separation or transfer from the university, and is cancelled upon separation or transfer from the university for classified employees.  Under certain conditions, compensatory leave earned by unclassified employees may be transferred to another agency if there is no break in service.
    • All unused compensatory leave earned hour for hour by non-exempt employees must be paid upon separation or transfer from the university at the final regular rate of pay received by the employee.
 
COMMUNICATION
 
This communication is distributed through the Academic Advisory Council, the Administrative Advisory Council, the University Listserv, the University Policy page, and through routine communication between departments.